Red Violet (RDVT) Earnings Date & Reports

Key Takeaways

• Red Violet reported record revenue of $27.8 million for the third quarter of 2026, up 20% from a year earlier.
• Adjusted earnings per share (EPS) came in at $0.47 on a diluted basis, above the roughly $0.41 consensus estimate.
• Adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) rose 22% to $11.0 million, with margin expanding to 40%.
• GAAP net income increased 29% to $5.4 million, or $0.35 per basic and diluted share.
• The company held $165.7 million in cash and U.S. Treasury investments with no debt after a $108.7 million public offering.
• Customer metrics advanced, with 383 net new IDI customers and 19,688 added FOREWARN users during the quarter.
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Earnings Context and Why It Matters

Red Violet's third-quarter report extends a long run of consistent execution for the analytics and information solutions provider. The company, which operates the IDI and FOREWARN platforms for identity intelligence and risk mitigation, has now delivered dozens of consecutive quarters of double-digit revenue growth. This report matters because it arrives just after a $108.7 million capital raise, giving investors a first look at how management is pairing an expanded balance sheet with its stated strategy of investing in the platform, data assets, and potential strategic M&A (mergers and acquisitions). With adjusted margins already near record levels, the quarter offers a fresh read on whether profitability can keep expanding while the company funds its next phase of growth.

Reported Results

For the three months ended September 30, 2026, Red Violet posted total revenue of $27.8 million, a 20% increase year over year and slightly above the roughly $27.2 million consensus estimate. Growth was broad-based across all five revenue verticals, led by the Investigative and Collections segments.

Adjusted earnings per share reached $0.47 on a diluted basis, exceeding the approximately $0.41 consensus forecast. On a GAAP (Generally Accepted Accounting Principles) basis, net income rose 29% to $5.4 million, or $0.35 per basic and diluted share, up from $0.28 a year earlier. Net income margin improved to 20% from 18%.

Profitability metrics continued to strengthen. Gross profit increased 25% to $21.0 million, while adjusted gross profit rose 22% to $23.7 million, lifting adjusted gross margin to 85% from 84%. Adjusted EBITDA climbed 22% to $11.0 million, with adjusted EBITDA margin expanding to 40% from 39%. Operating cash flow increased 25% to $12.7 million.

Customer growth remained healthy. The company added 383 billable IDI customers, ending the quarter with 11,252, and added 19,688 FOREWARN users to finish at 462,861 users, with more than 665 REALTOR associations under contract.

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Market Reaction and Investor Sentiment

Heading into the release, sentiment was broadly positive following Red Violet's record second-quarter results and its recent equity raise. The company has a history of exceeding consensus EPS estimates, topping forecasts in six of its prior eight quarters, which set a high bar for the third-quarter print. The combination of a modest revenue beat and a stronger-than-expected adjusted EPS reinforced the narrative of steady execution and expanding operating leverage. Key watch items for investors include the trajectory of the softer Red Violet real estate business, which declined at a high single-digit rate year over year, and how management deploys its enlarged cash position toward disciplined M&A rather than purely organic growth.

Forward Outlook and Key Factors to Monitor

Investors should watch how Red Violet deploys the roughly $109 million in net proceeds from its recent public offering. Management has emphasized a disciplined framework that prioritizes investment in its platform, proprietary data assets, product development, and go-to-market capabilities, while evaluating acquisitions that add unique data, enabling technology, or vertical-market expertise.

Margin trends remain a central theme. The company has indicated that full-year adjusted EBITDA margin is expected to land in the high-30% range, with the first three quarters seasonally strongest and the fourth quarter lower due to year-end incentive accruals. Whether the business can sustain its roughly 40% adjusted EBITDA margin while funding growth will be a key test.

On the demand side, the Collections vertical is benefiting from elevated consumer delinquencies and rising account volumes, while law enforcement adoption continues to expand within Investigative. By contrast, the Red Violet real estate segment remains a headwind tied to housing-market softness and is expected to stay subdued until conditions improve. FOREWARN's growth into new verticals, including home healthcare, represents an additional catalyst worth monitoring in the quarters ahead.

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