CLEAR Secure, Inc. (YOU) Earnings & Analysis

Latest quarter

CLEAR Secure reported Q3 FY2026 revenue of $292.9 million, up 27.8% from $229.2 million a year earlier and above its own guidance of $284.0 million to $287.0 million. Its filing attributed revenue growth primarily to more active CLEAR+ members and higher membership prices.

CFO Jennifer Hsu said active CLEAR+ membership reached 8.5 million, up 14.5% year over year, while total bookings rose 24.4% to $323.5 million. CLEAR reported net income of $75.3 million and GAAP earnings of $0.52 per share. Operating margin was 28.3%, compared with 23.0% a year earlier.

Free cash flow was −$103.8 million, compared with −$53.5 million in the prior-year quarter. Hsu said the quarter’s cash flow reflected an approximately $315 million settlement of accrued partnership liabilities, primarily related to merchant credit card benefits. She also said CLEAR repurchased $171 million of shares during the quarter.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

Revenue came in within or above the company’s guide in 2 of the last 2 quarters it guided.

What management said on the call

CEO Caryn Seidman-Becker said CLEAR’s identity platform is extending beyond airport checkpoints into digital security. She said the company expanded its multiyear contract with CMS and that health care customers are using CLEAR1 to secure access to people, systems and data. Existing customers that begin with employee verification can expand to patients, consumers and vendors, she said.

CFO Jennifer Hsu said CLEAR also began a pilot with the VA. Asked about CLEAR1, Seidman-Becker said a broader product portfolio, a larger customer base and an expanded sales force give the company opportunities to sell additional services to existing customers and reach new ones.

On travel, Seidman-Becker said CLEAR is expanding its Home to Gate services, with eGates covering almost 80% of its network and Concierge available at almost 70% of its airports. In response to questions about member growth and pricing, Hsu pointed to retention and new-member acquisition, as well as potential standard price increases, adjustments to discounted prices and tests of new packages. She said CLEAR is exploring how a premium bundle might work alongside its current transactional Concierge pricing.

Asked about margins, Hsu said revenue growth had outpaced growth in the cost base while CLEAR continued investing in its identity platform and newer businesses. She said she sees room for margin expansion as the business scales.

On the quarter ahead, Hsu said guidance excludes potential large CLEAR1 contracts because their timing is difficult to predict. She added that CLEAR1 bookings could be uneven depending on when deals are signed. Hsu said the renewed credit card partnership agreement moves liability payments to a quarterly schedule beginning in the first quarter of 2027, and that CLEAR expects free cash flow to be positive and more evenly distributed across quarters.

Guidance

CLEAR raised its FY2026 free cash flow guidance to at least $490 million from at least $480 million. Hsu said the company expects significant year-over-year adjusted EBITDA margin expansion for the full year, compared with its previous expectation of meaningful expansion.