Cardlytics (NASDAQ:CDLX) reported second-quarter results that met its guidance for billings, revenue and Adjusted Contribution and exceeded the high end of its Adjusted EBITDA outlook, as the company cited advertiser growth, improved churn and stabilized supply.
Chief Executive Officer Amit Gupta said investments made earlier in 2026 in personnel, the advertiser business and the technology platform were beginning to produce results. He characterized 2026 as a year of execution, with the company focused on expanding bank and publisher relationships, increasing advertiser revenue through purchase intelligence and advancing its technology platform.
Second-Quarter Financial Results
Chief Financial Officer David Evans said year-over-year comparisons exclude Bridg, which Cardlytics divested during the first quarter. Second-quarter billings totaled $65.5 million, down 34% from the prior-year period, while revenue fell 36% to $36.9 million.
Evans said the company expects to continue facing difficult year-over-year comparisons until the first quarter of 2027, when it anniversaries changes in its bank-partner relationships.
- Adjusted Contribution was $21.3 million, down 32% year over year.
- Adjusted Contribution margin increased to 57.7% of revenue from 54% a year earlier.
- Adjusted EBITDA was positive $1.7 million, compared with $3 million in the second quarter of 2025.
- Adjusted operating expenses declined 31% to $19.6 million, reflecting workforce reductions taken in the second half of 2025 and cloud-infrastructure optimization.
- Operating cash flow was negative $8.6 million, compared with positive $1.2 million a year earlier.
- Free cash flow was negative $10.7 million, compared with negative $3.4 million in the prior-year period.
Cardlytics ended the quarter with $28 million in cash and cash equivalents and approximately $20 million available on its credit facility. Evans said the company remains focused on free cash flow and expects it to trend closer to Adjusted EBITDA over time.
Monthly qualified users, or MQUs, were 185 million, down from 224 million a year earlier, which Evans attributed to previously discussed changes in bank-partner relationships.
Advertiser Growth and Bank-Partner Activity
Gupta said active advertisers increased 18% sequentially during the second quarter, while billings rose 11% quarter over quarter. New-logo volume increased 59% sequentially, and billings from total new business rose 17% from a year earlier. The company’s largest new logo in the quarter was more than double the size of its largest new logo a year earlier, according to Gupta.
Growing advertisers, defined as those increasing billings with Cardlytics, rose 42%. Meanwhile, churn declined 50% by advertiser count and 88% by dollar impact.
Gupta said the company’s ability to measure results quickly and help advertisers scale campaigns has supported the growth. He cited a national restaurant brand that piloted the platform in the second quarter and later signed at its maximum potential, as well as a home-services advertiser that expanded from one location to seven before its pilot concluded.
On the financial-institution side, Gupta said existing and prospective bank partners have shown interest in broadening card-linked offers to additional portfolios. One major bank partner agreed to temporarily reduce its financial-institution share to accelerate co-development and program innovation, he said.
Cardlytics also cited a bank-funded rewards program that offered additional rewards for cardholders making two redemptions in a month and a higher reward for three redemptions. The company said the initiative increased total redemptions by 105%, first-time redeemers by 113% and merchant-funded redemption spend by 78%.
Local third-party offers are live across four major banks and generate nearly 5,000 redemptions daily, Gupta said. Billings from those offers have risen 20% since the start of the year. In the United Kingdom, Cardlytics expanded its role with Monzo beginning in July, providing more card-linked offers to the bank’s U.K. customers.
Consumer Trends and Technology Initiatives
Management said its purchase data pointed to a rebound in U.S. consumer spending growth to 3.6% year over year in June, up from 2.3% in May. Gupta said lower-spending households were driving the recent growth.
In quick-service restaurants, Cardlytics said spending rose 3.3% year over year, though nearly all of the increase reflected menu inflation and real demand was flat. Delivery spending, meanwhile, increased more than 18% during the quarter. Gupta said the company has used these insights to help restaurant clients adjust customer targeting and retention strategies.
Cardlytics said it has launched AI capabilities that generate industry- and brand-level spending insights from purchase data, as well as an AI-driven campaign publishing engine intended to automate campaign setup and configuration. The company said U.S. campaign creation now takes about half the time it did a year ago while meeting internal targets 99.4% of the time.
The company is also developing tools that would allow banks to personalize offer ranking, reward values and bank-funded offers for designated customer segments. Gupta said Cardlytics expects to begin testing those capabilities with a bank partner soon.
Third-Quarter Outlook
For the third quarter, Cardlytics forecast billings of $61 million to $67 million, revenue of $34 million to $39 million, Adjusted Contribution of $20 million to $23 million and Adjusted EBITDA ranging from breakeven to positive $3 million.
Evans said the outlook reflects comparable performance with the second quarter as the company seeks to solidify its business following earlier investments. He added that Cardlytics does not anticipate additional operating-expense or capital-expenditure needs, although the company could have occasional staffing needs. He expects broader headcount to remain generally stable.
Gupta said the company’s near-term priorities remain building supply, expanding its advertiser base, improving retention and scaling product capabilities as it lays a foundation for renewed growth.
About Cardlytics (NASDAQ:CDLX)
Cardlytics, Inc operates a purchase intelligence and marketing platform that connects advertisers with consumers through bank and credit card transaction data. The company partners with financial institutions to analyze anonymized purchase information, enabling brands to deliver highly targeted offers and rewards directly to customers’ online and mobile banking channels. By leveraging real-time insights into consumer spending habits, Cardlytics helps marketers optimize campaign performance and measure return on ad spend more accurately than traditional digital advertising methods.
At the core of Cardlytics’ offering is its proprietary purchase intelligence engine, which aggregates and anonymizes transaction data from partner banks and credit unions.
