Red Violet (RDVT) Q2 2026 Earnings Report

The earnings call conveyed a strongly positive performance: record revenue, margins, profitability, cash flow and liquidity, together with a record number of new customers and meaningful FOREWARN expansion. Management signaled disciplined use of ~$109M in proceeds to accelerate AI-enabled product road map, organic data expansion, and targeted M&A, while continuing to invest in product and go-to-market. Headwinds are limited and largely manageable (modest decline in real estate IDI, slightly lower gross retention, higher operating expenses, and slower federal conversions), and management emphasized that these do not materially alter the company’s growth trajectory or competitive positioning.

Management's explicit guidance was that full‑year adjusted EBITDA margin is expected to be in the high‑30s (with the first three quarters seasonally strongest and Q4 lower due to year‑end incentive accruals), and that the company will deploy the roughly $109 million of net proceeds from the recent offering—alongside existing cash of $50.0 million and $15.5 million remaining on the repurchase program—into working capital, disciplined M&A, and continued investment in product/AI engineering, infrastructure and go‑to‑market while maintaining operating leverage and profitability. This outlook was delivered against Q2 results of $26.7 million revenue (+23% y/y), record adjusted gross profit of $22.9 million and adjusted gross margin of 86% (up 2 pts), adjusted EBITDA of $11.2 million (42% margin, +48%), adjusted net income of $7.2 million and adjusted EPS of $0.50, cash from operations of $10.6 million, free cash flow of $7.2 million (+50%), 447 new IDI customers (10.9k total), 25.5k new FOREWARN users (443k total) and 660 contracted realtor associations.