Freightos Limited Ordinary shares (CRGO) Q3 Earnings call transcript Nov 25, 2024
2min read Freightos, a leading digital freight platform, recently released its Q3 2024 earnings report, highlighting its strategic acquisitions, platform growth, and revenue growth. The company's CEO, Dr. Zvi Schreiber, and CFO, Ran Shalev, provided insightful commentary on the company's performance and future outlook during the earnings call.
Strategic Acquisition of Shipta and Platform Growth
One of the key highlights of the earnings call was the successful integration of Shipta, a leading procurement and tender management platform, which strengthened Freightos' position in the market. This acquisition aligns closely with Freightos' mission to digitalize freight operations, enabling enterprise customers to streamline complex procurement processes for long-term freight contracts. Freightos has already started introducing Shipta's capabilities to its customer base, with notable wins in the elevator and escalator manufacturing, pharma, and cosmetics industries. The integration is expected to further validate the strategic fit between the two solutions and provide significant cross-selling opportunities.
Freightos also reported a record-breaking quarter with 339,000 transactions, marking its 19th consecutive quarter of record transactions. This growth reflects the increasing adoption of Freightos' digital platform as an essential tool for global freight operations. With a focus on expanding the scope of transactions, Freightos has integrated additional services such as trucking to provide a seamless door-to-door freight experience. In Q3, the company's less than truckload (LTL) offerings performed well, highlighting the value of its multimodal capabilities.
Revenue Growth and Operational Efficiencies
Freightos reported a significant increase in revenue, with Q3 '24 revenue reaching $6.2 million, reflecting a 21% year-over-year increase. Platform revenue grew by 29% year-over-year to $2.3 million, while solutions revenue increased by 17% year-over-year to $3.9 million. These results underscore the growing adoption of Freightos' platform and the company's ability to scale effectively while meeting the diverse needs of its customers.
Operational improvements and lower cost of goods sold contributed to a significant improvement in adjusted EBITDA, outperforming expectations and indicating a path towards achieving positive adjusted EBITDA by the end of 2026. Freightos' cash position remains strong, providing a solid foundation to continue its growth strategy.
Looking Ahead: 2025 and Beyond
Freightos is finalizing its budget planning and business spending for 2025, with expectations of continuing the momentum of Q3 and Q4 throughout the year. The company is excited about its product roadmap and commercial initiatives planned for 2025, which it will share during upcoming investor calls. Freightos' focus on digitalizing the freight industry is poised to drive growth and operational efficiency, particularly in a market that is still largely offline.
Challenges and Opportunities
The earnings call also touched on the potential impact of the Trump administration on the industry. While it is unclear how the current administration's policies will affect international trade and freight, Freightos remains optimistic about the industry's growth prospects. With a strong focus on digitizing the industry, Freightos is well-positioned to capitalize on the increasing demand for digital solutions in freight operations.
In conclusion, Freightos' Q3 2024 earnings call highlighted its strategic acquisitions, platform growth, and revenue growth, underscoring its commitment to digital transformation and operational efficiency. With a strong financial position and a clear focus on innovation, Freightos is well-positioned to capitalize on the opportunities in the evolving freight industry.