VIA

Thank you for standing by. My name is Kate, and I will be your conference operator today. At this time, I would like to welcome everyone to the Via Q1 2026 earnings call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question, press star one again. Thank you. We will now start the presentation.

[Presentation]

Good morning, and welcome everyone to Via's first quarter 2026 earnings call. I'm Gabby McCaig, Via's Chief Corporate Communications Officer and Head of Investor Relations. With me today are Daniel Ramot, Via's Co-founder and CEO, and Clara Fain, Via's Chief Financial Officer. During today's call, Daniel will review our first quarter 2026 business update before handing it off to Clara to discuss financial results and our guidance for the rest of the year. We will then open the call to Q&A. In addition to prepared remarks on this call, additional information can be found in our investor presentation, press release, and SEC filings on our investor relations website at investors.ridewithvia.com. Before we get started today, we wanna draw your attention to the safe harbor statement included in our press release and investor presentation.

Items we discuss today will include forward-looking statements about topics including, but not limited to, our future financial performance, projections, and management's plans and objectives for future operations. Actual results may differ materially from those presented in the forward-looking statements and are subject to risks and uncertainties described more fully in our SEC filings, including our quarterly report on Form 10-Q. Any forward-looking statements that we make on this call are based on our assumptions as of today, May 12th, 2026. Unless required by law, we undertake no obligation to update or revise these statements as a result of new information or future events. We would also like to point out that our discussion today will include certain non-GAAP financial measures, in addition to, not as a substitute for, financial measures calculated in accordance with generally accepted accounting principles.

Definitions of these non-GAAP financial measures, along with reconciliations of non-GAAP to GAAP financial measures, are provided in our press release and our investor presentation. Without further ado, I'll now hand it over to Daniel.

Thanks, Gabby, and thank you everyone for joining us today. We're delighted to report another outstanding quarter for Via, with results that exceeded both top and bottom-line expectations. In Q1, our revenue grew 29% year-over-year to $127 million. This was our first quarter with over $500 million in run rate revenue, an important milestone for the company. The number of customers on our platform grew in Q1 to 838, up 23% year-over-year. We continue to make significant strides towards our profitability target with adjusted EBITDA margin of -4.6% in Q1. The basis for our rapid and durable growth is twofold. We are in the early stages of transforming an enormous market, and we offer a unique and differentiated solution that customers increasingly recognize as superior.

In our core geographies of North America and Western Europe, our serviceable addressable market is estimated at $82 billion based on a report we commissioned from a major consulting firm. Both by customer count and by revenue, our penetration of our SAM is less than 2%. This presents a tremendous opportunity for continued growth for Via. The key to our ability to rapidly transform this enormous market is our unique product and go-to-market strategy. Via is the only company that offers an end-to-end unified platform for optimizing and operating entire transit systems. At the core of our platform is our purpose-built AI-powered software, which leverages proprietary data and expertise we amassed over more than a decade. When customers adopt our software, they can leapfrog decades of technology neglect and rapidly break down technological and operational silos, driving immediate ROI. Crucially, our platform extends well beyond software.

We are a full-stack transit provider with a broad suite of technology-enabled services that allow us to directly participate in the delivery of transit services to end customers. When customers select Via to provide these services, we become the real-time orchestrator and optimizer of their transit network, assuming control and accountability for service levels, cost, and passenger outcomes. Our software and services are deeply integrated, creating a virtuous cycle. Our software is embedded in every aspect of our services, driving significant efficiency over legacy transit providers who make limited use of technology in their operations. Our services create a powerful feedback loop that supports continuous improvement of our software and provides proprietary data for our AI models. Consistent with the unique nature of our platform, our revenue model is predominantly based on usage and outcomes.

When customers select Via to orchestrate the delivery of transit services to their passengers, the increased control and accountability can drive operating leverage and enhance our ability to scale with these customers. Our revenue model minimizes friction for expansion and allows us to seamlessly capture this upside. We believe our platform to be the most extensive integrated solution available on the market, enabling customers to seamlessly plan, schedule, operate, and optimize their system across transit modes. Within our platform, microtransit remains Via's founding innovation. It is a new paradigm for mass transit, utilizing dynamically routed flexible shuttles in place of rigid fixed-route and fixed-schedule buses. Our analysis of large U.S. transit systems, for which we have data by bus route, indicates that between 15%-65% of bus routes for those systems operate at lower efficiency than microtransit.

These routes are prime candidates for replacement by microtransit and represent strong expansion opportunities for Via. While microtransit remains a major catalyst for adoption, our focus today has expanded to managing entire transit networks on behalf of our customers, including paratransit and buses. The focus on providing the orchestration layer for entire transit networks is a major contributor to recent acceleration in the growth of our pipeline. Last quarter, we reported that our pipeline grew more than 50% year-over-year. This trend has continued in Q1, and we ended the quarter with a record $650 million in pipeline opportunity. We first took on management of an entire transit network in Sioux Falls, South Dakota.

Winning the contract in late 2023 and launching in January 2024, this highly successful partnership with Sioux Falls is the foundation of our expertise and credibility as an orchestrator of full transit networks. After assuming responsibility for the transit network in Sioux Falls, we launched microtransit citywide, modernized and integrated the previously siloed paratransit system, and redesigned the bus network in close collaboration with the city and the community. This transformation produced outstanding results, reversing a multi-year trend of rising operating costs and declining ridership, driving ridership growth of close to 40%. So far in 2026, we have already been awarded four network deals, representing over $40 million in total annual contract value.

We are very encouraged by these recent network wins and believe they may represent an inflection point in our ability to win these opportunities. In our view, there are three key factors behind our recent success with network opportunities. First, while some customers have historically procured transit operations and software separately, in some cases even independently procuring services for each transit mode, we are increasingly seeing integrated opportunities that combine transit services and software across multiple modes. Now that we have set the precedent, customers recognize the value of an integrated transit system. When they choose to procure such a system, we are well-positioned to capture the opportunity. Second, having established Via as a successful provider of integrated network solutions with strong results and references, we are now able to credibly pursue and win these opportunities. The third important factor is AI.

Thanks to AI, we're able to build solutions at a faster pace than ever before. This allows us to enter new verticals, such as buses, more rapidly. It also means the gap between our offering and those of existing competitors is expanding, allowing us to deliver superior ROI to our customers. Looking ahead to the rest of 2026 and beyond, we are excited by the number of network opportunities in our pipeline and the potential to further accelerate and drive growth in our business. We are in the very early phases of realizing the potential of AI to drive increased automation and efficiency across every aspect of our operations, from routing efficiency to dispatch productivity, lower customer service costs, and improved fleet uptime. As the network orchestrator, we are in a position to translate these service cost reductions into expanded margins, especially as volume scales.

As their economics continue to improve, autonomous vehicles represent one clear such avenue for cost reductions in the delivery of public transit services. We've seen strong interest from our customers who seek to integrate AVs into their public transit fleets, and we've seen strong interest from AV developers who are seeking to partner with us to provide the deep vertical stack required to serve public transit customers. Building on our partnership with Waymo, we recently partnered with Beep to provide a fleet of autonomous shuttle buses for the city of West Palm Beach, and we're actively discussing opportunities with other AV developers. We view these partnerships as further proof that Via is rapidly becoming the operating system for future cities. We are also continuing to explore the opportunity to extend our platform beyond transit by leveraging our strong local government relationships and AI.

Our new Via AI Labs division will leverage forward-deployed engineers using AI to rapidly explore and productize solutions to cities' most pressing civic challenges, including waste management, road maintenance, and data optimization. While still early days, we're seeing strong initial interest from cities, indicating that Via AI Labs has the potential to be a meaningful catalyst to expand our platform and grow our TAM beyond transit. Lastly, before I hand it over to Clara, I would be remiss not to mention our podcast, ModeShift. ModeShift is a thought-provoking, fast-paced conversation led by Andrei Greenawalt, our Chief Policy Officer, about mobility history, policy, and technology. If you aren't already listening to ModeShift, it's a go-to for anyone interested in transportation, recently reaching as high as number two in the government category on Apple's podcast chart. Season two is now out, and I would encourage you to subscribe.

With that, I'll pass it over to Clara to review the financial highlights for the quarter and our guidance for the year.

Thank you, Daniel. I'm happy to report that Q1 was another very strong quarter for revenue and profitability, with demand for Via's platform reaching a record high. We exceeded 500 million in annual run rate revenue for the first time in the company's history, nearly doubled our pipeline of opportunities compared to the same period last year, accelerated on several fronts thanks to AI, Last but not least, leaped closer to profitability. As we have in all our prior quarters as a public company, we also exceeded our revenue and adjusted EBITDA guidance. Let's start with top line. In Q1 2026, our annual run rate revenue, which is defined as our quarterly revenue multiplied by four, was $510 million, representing a year-over-year increase of 29%.

Our growth was fueled by the U.S., which represented 74% of our revenue and where we grew 36% year-over-year. Internationally, we saw strong momentum in the U.K., where revenue was up 68% year-over-year. At the same time, we continued to face headwinds in Germany as our customers continue to navigate a sustained constrained budgetary environment. These results reinforce the benefits of our geographical diversification strategy. We closed the quarter with 838 customers at a record high. We're continuing to benefit from flywheel effects in multiple states where the success of existing customers drives referenceability and allows us to rapidly grow revenue without a corresponding increase in sales and marketing investment.

For example, in California, we saw an 85% increase in revenue year-over-year in Q1 2026 and are pursuing close to $100 million in active pipeline in the state. Let's dive into our margins and expenses presented on an adjusted basis. In Q1 2026, we spent 13% of our revenue on sales and marketing, compared to 14% in Q1 2025. We see very attractive ROI from our investment in sales and marketing and are taking advantage of several internal AI initiatives, including automation of sales outreach, and design. We believe these initiatives will yield measurable upside. We also spent 15% of revenue on G&A, which was consistent year-over-year. Our G&A expenses were driven by public company costs and increased insurance costs from higher premium and claims expenses in the quarter as we continue to scale the business.

Finally, R&D expenses represented 16% of revenue compared to 20% in Q1 2025, demonstrating very effective leverage. Our engineering team continued to gain efficiency by extensively leveraging the most advanced AI coding tools. Over 75% of our code is now written by and with AI, allowing us to effectively reduce costs year-over-year. Efficiency savings were offset by the unprecedented strength of the Israeli Shekel, which is the currency of our largest R&D center and currently stands at a 30-year high versus the US dollar. The strength of the Shekel had about $2 million of negative impact to adjusted R&D expenses when compared to Q1 2025. We wrapped up Q1 2026 with -4.6% adjusted EBITDA margin compared to -8.4% in Q1 2025, continuing to make significant progress on our path to profitability.

Finally, our balance sheet remains strong with $348 million of cash and no outstanding debt as of March 31. Over the past few years, we have been able to drive significant operating leverage while generating rapid revenue growth, with adjusted operating expenses going up by only $10 million since Q1 2023, while quarterly revenue grew by $74 million in the same period. We believe that we can continue to execute with the same level of discipline in 2026. Now let's turn to guidance. Based on our Q1 results and early traction with full network opportunities, with several deals that we have won and will begin to recognize revenue from in the second half of the year, we are raising our guidance for the year.

For the second quarter of 2026, we expect revenue to be between $132.5 million and $134 million, representing 23.7%-25.1% year-over-year growth. We also expect adjusted EBITDA margin to be between -3% and -2.2% with adjusted EBITDA between negative $3 million and negative $4 million. There are several factors driving our Q2 guidance. First, we're experiencing continued headwinds in Germany with slower growth and higher trend than normal. Second, consistent with historical revenue patterns, our market has a certain cadence to it, with new deals launching when existing contracts expire. This year, we are seeing many large deals that are already contracted or won launch later in the year, which informs our Q2 guidance and our full year revenue guidance.

For the full year 2026, we are raising our revenue guidance to $547 million-$550 million, representing 26%-26.6% year-over-year growth. We are reiterating our adjusted EBITDA guidance at -$12.5 million to -$7.5 million, despite about $2 million of annualized impact from the strength of the Israeli Shekel as of end of Q1. We reiterate our goal to deliver our first quarter of profitability in Q4 2026 with positive adjusted EBITDA, which we believe will be a major milestone for Via and an important step on our path to delivering great returns to our shareholders. With that, I wanted to thank you all again and turn it back to the operator so we can take some questions.

At this time, I would like to remind everyone in order to ask a question press star then the number one on your telephone keypad. We will pause for just a moment to compile The Q&A roster. Your first question comes from the line of Adam Hotchkiss with Goldman Sachs.

Great. Thanks so much for taking the question. Daniel, appreciate all the detail around flywheel states, and I know these brand network effects are something we've talked a lot about in the past. Wondering if you're seeing your referenceability starting to actually catalyze incremental RFP activity? I'm thinking as you launch some of these AV partnerships and build out some of these adjacent offerings like student transit, and I think you even mentioned waste management on the call. Do we at some point go from an RFP environment where customers are proactively looking to replace an existing process to one where Via's brand in the market is actually pulling forward some of these decisions by governments? Thanks so much.

Thanks so much. It's a great question regarding the effects of the flywheel states and how they're impacting RFPs we're seeing in the market. Overall, I think we're seeing a very positive trend in these flywheel states across a number of factors. One, we're seeing generally win rates higher in these flywheel states, you know, somewhat higher, which is very encouraging. We are seeing increased activity for Via in those states. If we look across our pipeline, we are seeing that, you know, a large percentage of the pipeline is coming from these flywheel states and starting to see a dynamic.

I think I mentioned this in the prepared remarks that we are, we're really transitioning more and more into opportunities that are well suited to Via, these integrated opportunities that combine the services and the software where we think we believe we have a strong advantage in winning those opportunities. Across a number of dimensions, win rates, the contribution to our pipeline, and then the types of opportunities we're seeing in those flywheel states where we're getting the referenceability, where our offerings quite familiar to our customers, you're starting to see them shift towards creating opportunities and seeking opportunities that are better suited for Via. For us, that's a very encouraging direction.

Okay, great. Thanks for taking the question, Daniel.

Thank you.

Your next question comes from the line of Josh Baer with Morgan Stanley. Your line is open.

Great. Thanks for the question. Wanted to ask one on the Via AI Labs and the commercialization of those efforts. Maybe for Daniel, if you could talk a little bit about specific products or use cases that are being developed, and, you know, any update on how that opportunity is developing here. Then for Clara, a follow-up would be on the economic side, how you think about how much to invest in AI Labs and, you know, what we should expect from a monetization perspective over time.

Hey, Josh. Thanks for the question. For AI Labs, we're seeing some really interesting dynamics. Just as far as maybe just to try to get to your question directly as far as the specific products, you know, I just wanna remind everybody that our customers, there's a whole range. There's some that are incredibly sophisticated with AI and are really trying to deploy it internally across their city hall, but that is very rare. For the most part, our customers, you know, they're not your typical Silicon Valley company that's sort of knee-deep in AI and that's all they think about.

Even simple things like just trying to help them get all of their disparate, dispersed, you know, often not very easy to access data into one place that they can look at together in a very organized fashion can be incredibly helpful and frankly transformative. You know, a very basic just trying to help them put all their data together into one dashboard in a very simple way, I think prior to AI would be actually very hard to do, just the way that the data is set up. What we're finding is with AI, we can create tools for them that are incredibly helpful very fast. Those tools, once we create them, can then be taken to other cities, you know, which in the past would have been hard.

They've been very bespoke and difficult to translate and scale. That's one just to, just to give a sense of, you know, something that I think in a, in a company or in a bank you would think is trivial, in a municipality may not be and may actually be quite transformational. Beyond that, I think we're seeing some really interesting early use cases around sanitation, things like just scheduling. You know, this is a sort of core Via capability, scheduling of resources. If you need to go out and fix potholes, just the ability to schedule that in a, you know, limited resource, schedule that in a more useful way.

Just bringing data together from different sources, whether, you know, they have in law enforcement and public safety, there are a lot of very advanced tools that other companies are providing. Co-connecting that data to other parts of the organization is relatively limited, and so being able to bring, again, data together in that area. We've seen some interesting, you know, an interesting use case around social worker caseloads and being able to help them manage that and being able to schedule. A pretty diverse set of use cases.

We're still at the exploration stage of trying to figure out, you know, what are the best products for us to build. We're in the process of partnering with, you know, order of 12 municipalities to really dig into this and figure out the right way to build out this offering. Early days, very exciting from our perspective.

Thanks, Josh. From a gross margin perspective, we expect these initiatives to be accretive to our overall gross margin. We're adopting the forward-deployed engineer model, there are lots of comps there. You can get a sense for the gross margin profile. In terms of balancing the investment, you can see that we've implemented AI internally and truly transformed how the organization works. That has generated, helped us generate operating leverage and quite a lot of savings. In a way, we're reinvesting some of that into our AI capabilities and AI Labs. We expect to continue to balance that investment with our profitability targets.

Excellent. Thank you both.

Thank you.

Your next question comes from the line of Michael Turrin with Wells Fargo. Your line is open.

Hey, great. Thanks very much. Appreciate you taking the questions. Just a two-parter upfront for me. Daniel, the network win commentary stood out throughout your remarks. I think you mentioned four wins and inflection point. Can you just frame more broadly what those mean for Via and how you'd expect some of the successes there to scale more broadly? For Clara, it looks like you were guiding for it, but gross margin down a touch year-on-year. Just remind us if there's anything seasonal or near time impacting that line and if you're still confident in the path towards longer term expansion there. Thank you.

Thanks, Michael. Yeah, it'd be great to talk a little bit about the network opportunities and wins. I think maybe to tie this back to some of what we've been saying in the previous calls, we've seen a, you know, this is, we believe, also tied to Via going public and the higher profile that we have, you know, more credibility in the market and just the general growth, the flywheel states, has put us in a position over the last couple of quarters where we've been able to really expand our pipeline in a very meaningful way by adding to the pipeline effectively these much larger network opportunities. This also ties into a maturity of our product.

We've been investing across multiple verticals around transit, of course, for quite a number of years, and are now in a position where we have a solution that we believe can really address the entire network very effectively, both with software and services. It positions us very well, to go after these larger, full network opportunities. Tied into that with, you know, tied to my response to one of the previous questions, the market itself is also, sort of adopting these solutions, where before they were procuring these in a silo, software potentially separate from operations, you know, different, operational kind of verticals separately in a silo. These were less suitable for us. All of these are coming together and driving this pipeline increase.

I think we mentioned this last time, one of our key questions for us was, well, these are larger opportunities. They're a different category. They're relatively new for us. We are trying to be very focused in going after ones we think, you know, we have a good chance of winning that are well suited to our offering, that are in flywheel states. As I mentioned before, you know, we're trying to really be focused on where we can win. We don't know what the win rates are gonna look like. Are they gonna be similar to our historical win rate? That's really, I think, this is probably the most important point for us as a company that we're very focused on.

You know, the last few months have been very encouraging, so I don't, you know, it's still early days. I don't wanna overstate, but we're very encouraged by the trend. We think there's a potential to see this inflection point with these recent wins there. You know, our government customers tend to like to pick companies that have been picked by others already. They don't love to take a ton of risk, understandably. We believe that these wins are a good, sort of, you know, initial step to start to turn that flywheel in this area as well. Very encouraging. You know, it is a core focus area for us as a company. It's what, you know, I'm very focused on. We're all very focused on.

Very large opportunity if we can convert it. Still early, but we're encouraged.

Michael, thanks for the question on gross margin. The good question on the year-over-year. Last year in Q1, we had about 5% of one-time revenue, which drove slightly higher gross margin for the quarter. This year in Q1, one-time revenue is about 1% of revenue, which gets us to where we are. That's gonna be the larger driver of the change year-over-year. Nothing different, just slightly different mix on this front. Going forward, as we said last quarter, we expect gross margin to be consistent in the near term as we continue to execute on our very large, you know, $650 million pipeline opportunity at the moment. We are committed to achieving 50% long-term gross margin.

We believe we can get there by continuing to optimize the cost of our services, now leveraging AI Labs, and new technologies like AI and AVs, and making accretive acquisitions.

Thanks very much.

Your next question comes from the line of Patrick Walravens with Citizens. Your line is open.

Oh, great. Thank you. Clara, I guess a couple for you. How much did Downtowner contribute this quarter?

Hey, Pat. Thanks for the question. You know, we're very pleased with the Downtowner acquisition, and how it's turning out and the level of integration that we've been able to reach. A perspective is that the material contribution from Downtowner is the number of customers. That's what we believe in, and we're very pleased with that. We've added 94 customers from Downtowner and already starting to see some cross sells there.

Okay. Do you wanna share what people are just asking what the organic growth rate was. That's what I'm trying to get at.

No, Pat, I really appreciate your question. I'm trying to answer it. You know, as you can see in our numbers, I'll take a step back. We increased guidance for the year. Our growth opportunity for the year, we feel very good about the general opportunity we're seeing. When, you know, I understood your question about organic growth and what I'm seeing, more so when I look forward to 2026 and 2027, I feel very positively. Demand for the platform is at a, we just shared this quarter that we have about $650 million of pipeline opportunities, which is, you know, a very strong increase year-over-year and at the highest we've ever seen our pipeline.

I believe that our potential for organic growth is very strong and has not slowed down at all.

Okay. Then, Daniel, can you talk a little bit more about what's going on in Germany and, maybe compare that to, like, California or something? What's the dynamic in Germany?

Yeah, Pat, I can take this one. Thanks. Germany is, for us, obviously presenting some real headwinds as you guys are seeing. Despite the headwinds, you know, I think we've had really nice results this quarter and are, you know, continue to be very positive about the year overall. Germany, we, you know, we're facing some headwinds that are unusual, so it is an unusual market for our perspective. It is an area where we have not yet been able to move past microtransit being adopted in a silo. I think we talked a lot on this call and in the past about the importance for us of deploying the entire platform. You know, in the U.S. we started obviously microtransit, then added paratransit, now we're adding sort of these full network opportunities.

That is really key both to our growth and, frankly, to the stickiness of the platform. As we add more and more of these services, it, you know, becomes very challenging to make any changes that don't involve working together with us. Oftentimes these changes actually present an opportunity. In Germany, we have not yet been able to crack it beyond the microtransit vertical. You know, we do sell planning and scheduling and other software, but the majority of our revenue still comes from microtransit. Unfortunately, the agencies there are still treating microtransit as a, you know, in a silo as a separate service. You know, we believe pretty strongly that Germany in that sense is very much behind other parts of the world, and we're not seeing that in the U.K.

Obviously, the U.S. we've talked about. Canada, you know, the dynamics are much more moving towards integration and for us an opportunity to deploy our whole platform. That coupled with the just the headwinds or macro headwinds, if you will, around funding that exist in Germany across the entire country, combine to create some real pressure on our services and limit our growth there. You know, we're pretty confident that this is a temporary situation, that we will be able that the strength of our product and our solution will allow us to move beyond that and, you know, embed our other products in the market as well, and the dynamic will change. It is taking longer than the than it has been in other markets.

That's sort of this unusual dynamic in Germany, the funding coupled with the fact that our services are focused in a silo.

Okay, great. Thank you for all that perspective.

Thanks, Pat.

Your next question comes from the line of Brad Zelnick with Deutsche Bank. Your line is open.

Great. Thank you so much for taking the question and great start to the year. I actually want to follow up on Patrick's question about the difficulties in Germany. You specifically called out both lower growth and higher churn. Is one of those particularly worse than the other? How would you characterize the health of existing customers and appetite for new programs in other areas within the E.U.? I mean, I guess, is there any risk that what you're seeing in Germany spreads elsewhere?

Yeah, Brad, thanks. I, you know, I don't know that churn or lower growth one or the other in Germany is where it's probably the lower growth, frankly, is, you know, that's just my sense is the real challenge there. It's, you know, by the way, just to be clear, it's not that the market in Germany is collapsing. Germany today represents 16% of our revenue. It's, you know, we see that market's probably staying fairly stable as far as revenue for a while. That's about where it's been. I believe we had 3% growth. It's just, you know, for us, relative to our 29% growth overall, 36% in the U.S. and so forth, it's just a headwind.

I think, you know, we have a real opportunity to turn it around in the coming couple of years, but for the moment, I would say the lower growth is probably a challenge. There's some churn. There's some elevated churn as well that we're contending with for all the reasons that I mentioned earlier. I want to be very clear about that. We really don't see that as a, you know, as a model for the rest of the E.U. Or anything that we're seeing anywhere else. It is very particular to Germany. It has to do with our roots there. Actually, Germany was a major growth driver for us earlier this decade, funny to say. We saw it really drive a lot of growth, very fast adoption.

It's now reached a relatively high level of contribution to our business relative to other E.U. Countries, and then it's in this position that we just discussed. In the U.K., we're seeing very different dynamics as we mentioned, really fast growth, adoption of our entire platform. There's a move there towards what's called franchising, which is moving responsibility for transit to local authorities, which is really driving growth for us and is, you know, has the potential to drive a ton of growth down the road. Has been driving some of the growth we're seeing today, although a lot of the growth has actually been pre-franchising. So we're seeing some really nice results there, and other markets don't really look anything like Germany from our perspective. You know, France, we have very different dynamics.

Italy and Spain, just getting started. Nordics and the Benelux countries, we're seeing very positive dynamics. It really is Germany is sort of a unique case, and has to do with just the way that we got into the country and then the current dynamics, and then of course this very challenging funding, with government instability and so forth that you've seen in Germany over the last couple of years, certainly not helping.

Thank you for that, Daniel. Very, very helpful to hear. Just a quick follow-up. A lot of volatility in fuel prices of late. What if if any impact does that have on your financials, and how are contracts structured as it relates to fuel price exposure? Thanks.

Thanks, Brad. Yeah, we're facing, you know, some large volatility in some of the elements here with the challenging macro. Fuel, we have some exposure to fuel. Fuel is about $3 million a quarter of spend in our COGS. That's kind of 2%-3% of revenue. We saw a spike in fuel costs towards the end of Q1, there's a little bit of impact there. Not material, but some impact to gross margins. We continue to see higher costs coming through Q2 and are expecting some impact there, which we factored into our guidance.

We do have contractual mechanism to pass through some of these increases to our customers and we are working on this pass-through as we speak, so we don't have to bear the cost of the higher cost of fuel. I feel optimistic that we'll be able to pass through the bulk of it and not have to incur those costs ourselves. That's kind of the general structure of the contract.

Thanks, Clara, and thanks again for taking the questions.

Thanks.

Your next question comes from the line of John DiFucci with Guggenheim Securities. Your line is open.

Thank you. I have a question for Clara, and then a follow-up for Daniel. Clara, it's good to see the strong results this quarter and the annual guide raised by just a little bit more than the beat. The second quarter revenue guidance was just below the Street's numbers, and given typical seasonality for 3Q being, you know, about 2Q a little bit higher. I think this implies a little more back-end loaded than the Street had for the year. We know you have great visibility into future revenue, not only for the existing contracts, but for new ones coming online too. Can you give us a little more color on why this looks a little more back-end loaded than I guess the Street had modeled, and how your business should progress through the year, especially the fourth quarter?

Thanks, John. You know, we did our best to give a sense for where we are and really appreciate your understanding of the results. You have a good understanding of what we're seeing. In Q2, we are seeing two factors drive the Q2 results. One is, I think we've discussed about the cadence of the market. There's some implicit interesting seasonality to our market where deals launch when other deals expire. We're seeing a lot of launches in H2 that are already won and contracted, which, you know, could have launched in Q2, but they're launching later in the year. That's driving some of our, you know, Q2 results.

One is, you know, the cadence of the market, which we have every year. This year, I think Q2 is like lower, then we'll see H2. We are seeing a strong H2 that you can derive from our guidance. Second, the headwinds that we just discussed in Germany are having a more pronounced effect on Q2, and that's also factored into the guide. Onto your comment around last year, the Q2 to Q3 seasonality, because of that, we're not expecting to see a similar pattern. We do expect H2, as you can derive from the numbers, to be quite strong. Not quite a similar dynamic to last year where we had kind of Q2 to Q3.

There'll be some seasonality in Q3, but it'll be more than offset by the launches.

Great. That's really helpful. Thank you, Clara. Daniel, Clara talked about R&D leverage in her prepared remarks, it would have come down even more. You would have gotten even more leverage if not for the strength of the Shekel. Can you talk about from the R&D perspective, talk about that benefit which we're seeing there, which I guess is AI related, to the innovation you're doing in R&D, especially as it, I guess, pertains to new things like AVs and Via AI Labs.

Yeah. John, thanks. I think you're seeing it exactly right. We are seeing some really promising and frankly exciting leverage on R&D. Certainly AI is a major contributor. I wanna say I think some of it is driven by AI. Some of it, frankly, I think is driven by just very, very good work that the team has been doing over the last few years to build, you know, build an infrastructure that's highly scalable. Not so easy with government customers, as we've discussed before, because they do like to kind of spec out your product and create, you know, a ton of diversity that's actually quite hard to manage at scale. You know, we have well over 800 customers, of course.

To provide to each of them you support all of their requirements with all the little details and sort of the vertical nature of that across everything we do around the platform at scale and still be able to move very fast is a really hard challenge. That's something that we, over the last few years, have invested a ton in trying to enable, so creating that infrastructure internally. When you layer AI on top of that, I think we're seeing some really, really nice progress there, and that's allowing us to run very fast. We, you know, we're seeing the leverage obviously in the financials. We talked about this last quarter, this has really continued our delivery on product is only accelerating.

I think if you talk to our customers, you'll hear the same from them. To me, we're really cranking on that part, and I'm very excited about it. Let's see how we can continue to accelerate.

That's great. Great to hear. Nice job, guys. Thank you.

Thanks so much.

Your next question comes from the line of Scott Berg with Needham & Company. Your line is open.

Hi, this is Ian Black down for Scott Berg. With the elevated oil prices, are you seeing any impact on end customer demand?

Yeah, that's a, you know, that's a really good question. Actually, I, and you're right to point it out. You know, there's several layers of the, you know, commodity price impact. The first one is obviously what we just discussed, you know, in our cost structure. The second one is that we are starting to see signs that actually not our customers, but their end customers, the riders or the folks that are actually using public transit are trying to use public transit more because of rising oil prices.

To that effect, we are seeing, you know, increasing demand for the services that we provide and for our customers and the customers.

Yeah. If I, if I may jump in too, Clara, I, I would also add that that is layered on top of I think this is, you know, well-known, you guys probably follow this, just how expensive it has become, especially in the U.S., to own a car, and it's been quite a lot written about it recently. Certainly to buy a new car and, you know, the cost of repairs for, you know, for used cars. If you layer on top of that the challenge that car ownership creates financially for folks now with the higher gas prices, I think that all folds into what Clara was just saying.

Great. A lot of your microtransit customers kind of start out with trials and expand over time. As you land more system-wide deals, should we expect kind of a change in how your customers ramp?

That's a good question. I think there's probably, you know, you may end up seeing less of customers going, you know, from, call it $1 million-$10 million, you know, as you might when we start with a microtransit, a smaller microtransit service, and then are able to take over the entire transit system. You know, my feeling is that, and tied in part to what we're saying, and then a lot of other products that we're able to sell, including entering the schools vertical. We're starting to see, for the first time in the last quarter, some nice cross-sell from our transit to our schools product, which previously, you know, these are related, but different departments oftentimes, the cross-sell is not as straightforward.

I think when we actually, those are coming. You know, the example I'm thinking of is coming from one of those network wins where we've taken over the whole network, and then our presence is so pronounced in the city that we now have an opportunity to translate that into a schools win. You know, our feeling is that there's still a lot more that we can sell to those customers, even when we take over the entire system. You probably won't, will not see that same big jump, you know, for, from a small microtransit deal to an entire transit, if that makes sense.

I'd add that the AI Labs opportunity is coming from a totally different pocket. In the near term, you're getting from transit to school and then getting through with the AI Labs opportunity, truly, I believe, expands the TAM.

Awesome. Thank you so much.

Sure.

Thanks.

Your next question comes from the line of Brian Schwartz with Oppenheimer. Your line is open.

Yeah. Hi. Thank you for taking my questions this morning. Daniel, I wanted to follow up on the comments about the pipeline doubling year-over-year. It's even bigger than the size of the business right now. My question is about the cadence of the conversion of that pipeline, how it's gonna play out. I wanted to ask you specifically about maybe procurement cycle timing. Are you seeing any meaningful changes from the government procurement timelines or the approval processes versus what you've seen in the recent past?

Thanks, Brian. We, you know, we haven't seen much of a change in our overall sort of sales cycle timeline. That has remained as it has throughout this period on, you know, on average, so it is average, fairly constant. It is something we're watching carefully to try to understand if these larger opportunities, you know, do they take longer? Is the decision, you know, and what If so, which part could take longer? Again, on average, we, you know, we need to get more data on these over the next coming quarters and really get a sense if, you know, hopefully we're able to continue to scale them and as discussed earlier. Right now, I would say we're not seeing any noticeable change, it is something we're definitely keeping an eye on.

On, on the whole, on the government side, you know, there's, especially in the U.S., there's not much of a change from, you know, the last few years that we're seeing. Dynamics continue to be fairly similar other than what I described earlier, which is, you know, we are really starting to shape the RFPs that are coming out, particularly in our flywheel states. We're seeing greater opportunity for us to, you know, to actually win those deals and so forth. I won't repeat everything I answered earlier, but from a kind of government macro perspective, we haven't seen any major change.

Thank you. My follow-up question for Clara. Just wanted to ask you about the timeline from the benefits that you could see from these AI initiatives, whether they're internal, whether they're AI labs, specifically with gross margin, 'cause I assume over time, it's gonna reduce your operating costs as well as your service delivery costs. From a timeline standpoint, when should we expect those efficiencies to start to play off and have a positive impact to the gross margin? Thanks.

Thanks, Brian, and thanks for the question. You know, there are several layers of your question. I think some of the internal efficiencies that we're seeing with AI are, you know, continuing to help drive the operating leverage that we're seeing, and we commented earlier on the R&D line. You can see some of that there already. We expect to continue to deliver, and we've been delivering despite, you know, very strong Israeli Shekel, which had about $2 million of year-over-year impact and kind of $2 million for the year at this point. It kind of gives you a sense for the level of efficiency that we're getting. To the top line, you know, I think it's still early to say for sure, so we'll kind of reserve the timeline for later.

We are seeing really nice momentum with customers and interested parties on our AI Labs products. We believe that the gross margin will be, you know, strongly accretive to our base gross margin for it to impact the overall business. You know, it will take a bit of time. You know, hopefully we get a little bit, you know, by the end of the year and then some next year. That's kind of the type of timeline we're looking at.

You know, we'll share more as we have more visibility into this.

Okay. Thanks for taking my questions.

Thanks, Brian.

Your next question comes from the line of Brian Peterson with Raymond James. Your line is open.

Thanks for taking the question. Daniel, maybe one for you. You've mentioned a couple big AV wins over the last few quarters. I'd love to understand the nature of those wins. Are those more pilots? As we're thinking about, like, the opportunity there, do you envision more kind of network-oriented arrangements with customers that are using AVs and that's a big potential unlock? Would just love to understand that a bit.

Yeah. Thanks. The AVs are definitely an area of great interest to us, and we're following the developments very closely. Well, you know, just to explain kind of the wins we've talked about so far. The one we mentioned, West Palm Beach, is, you know, that's an opportunity where we are going to deploy the AVs as fixed route shuttles, essentially as sort of small buses, as part of the service that we provide to the city. It is part of what the city was interested in, it's not coming immediately at launch, will come, you know, in the next year or two as those vehicles become available. It is very much embedded into the network and into the model. That's one kind of opportunity.

The other kind of opportunity is more in the sort of overflow, if you will, as we discussed in Chandler, what we're doing with Waymo, where we're leveraging the presence of AVs in the market as available sort of supply that we can, that we can take advantage of as part of our municipal service. Our view is that the first example where the AVs are really embedded into the service, we're utilizing them as, you know, a core part of the fleet, is the right model for us and is the one that we are most interested in, and we're trying to create.

You know, it's unclear yet who of these AV developers and which of them is gonna have the vehicles available and the right form factor, you know, the right price, frankly, because right now, obviously, they're very expensive and how quickly that will develop. Our view is we're trying to partner with as many of them as possible, so that as soon as those vehicles become available, we can plug them into our network in a major way. Again, our preferred model is to really embed them as part of the fleet that we're using.

We're seeing cities very interested in that, whether it's because they're motivated by innovation, appearing innovative, you know, and kind of being part of that cutting edge or because they're thinking about, okay, the economics as the price of these AVs goes down, that could represent savings and therefore allow them to deploy more service, you know, for the same budget that they have. Those are sort of two core reasons.

Thanks, Daniel.

Thanks.

Your next question comes from the line of Jonathan Ho with William Blair. Your line is open.

Hi. Good morning. I just wanted to understand, first of all, like what helped drive some of the strong growth in the U.K., and do you expect that to sort of persist over time as well?

Thanks, Jonathan. I can take that one. You know, U.K. dynamics, as we mentioned, are very favorable. I'd say there are probably two factors. One, this is a market where we, you know, I believe we've really established ourselves as, you know, by far the category leader. We're not seeing a ton of competition, and we're seeing really interesting opportunities, you know, the adoption of microtransit. I think you saw the video at the beginning of earnings, all from the U.K. There's just an understanding there of the potential for microtransit, a deeper understanding to really transform the market. We also have Citymapper there, which is a huge brand. You know, we're seeing some initial nice traction with our planning software and so forth.

That's one factor, just, really nice success of some of our core products. On top of that, we are seeing this move towards franchising and just local authorities taking on more responsibility for their. So there's a whole dynamic in the U.K. that I won't get into that's been around here for a few decades now. This move towards franchising is creating a shift in how the budgets are being utilized towards efficiency, towards services that are integrated, just, you know, an approach that's very well suited to our current offering. That's driving a very positive dynamic. You know, at least based on what we can see today, we believe that this trend should continue. We're very hopeful about the progress in the U.K.

Excellent. You know, how are you thinking about federal funding as well as some of the upcoming legislation in support for state government transit? Is there anything that's maybe in process that either you're excited about or that worries you? Thank you very much.

Thanks, Jonathan. You know, funding is a obviously a very important topic and kind of, you know, very diverse. As we talked about funding in Germany, I won't belabor. In the U.S., across the federal government, you know, what we're seeing is that funding is pretty consistent. If anything, the sorts of funds that are going into our services, either typically produce formula funds, a slight increase in that area. Nothing dramatic, but pretty consistent. Continued bipartisan support, you know, for public transit, at least the sort of, again, the sort of public transit we're providing. I know there's some debates about large infrastructure projects that are maybe in a different place.

When you talk about the sort of nuts and bolts, just providing public transit and the funds that are going into that, nothing very dramatic either direction, you know, on the federal front, as best we can see. You know, we would love to see the federal government move towards a funding model that encourages outcomes and sort of efficiency. We're having conversations around that front. I hope that that would, you know, that's something that the government will consider in some of the new funding bills. I think that would push agencies towards transforming their services in very positive ways, both for the residents and for us.

The last thing I'd say around it is with, you know, and we talked about the fuel prices, but there are other dynamics that are, I think, putting real pressure on Americans, you know, just people trying to live their everyday lives and trying to get around. Mobility is critical. Cars are becoming increasingly expensive, gas is expensive, and the need for public transit as a core service and the understanding of how much value that has. You know, a recent study from MIT showed for every $1 invested in Chicago public transit, there's an $11 return in economic activity. I think that understanding, you know, our sense is at the local level, the state level is starting to grow.

You know, of course, we're encouraging that, and we think that that's a potential positive as we look forward.

Thank you.

Thanks.

Your next question comes from the line of Alex Zukin with Wolfe Research. Your line is open.

Yeah. Hey, guys. Thanks for taking the time to ask the question, or take the question rather. Most of my questions have been answered, maybe Clara, can you quantify the actual headwinds to revenue that you're seeing this year and maybe gross profit in the model from the issues in Germany that maybe weren't in the plan initially? Then any headwind, I think you've quantified it, maybe just remind us the headwind on profitability for the year from the FX moves.

Thanks, Alex. Last but not least, I really appreciate your question. On the FX, I'll start with that. On the FX, we are seeing, you know, quarter-to-quarter, half a million dollars. If you annualize that, it's about $2 million. That's at the Q1 rate. They've seen continued strength of the Shekel, if you follow, which is at a 30-year high. We're looking at that. Year-over-year, $2 million. These are the same $2 million, but, you know, they accumulate. Overall a pretty significant impact from the Shekel. You know, that's one. You can do the math there.

On the Germany impact, you know, we've reflected that in our guidance. Overall, there is some impact to revenue and to, you know, to gross profit from what we're seeing from the headwinds in Germany. You know, I'll say that we've been able to more than offset that with the growth and the pipeline that we've created. I mean, kind of very pleased with the work that the team has done there. It supports our strategy of continuing to diversify revenue and get just a diversified, you know, geographical exposure as we continue to grow the business.

Got it. Maybe just one more, Clara. What drove receivables up sequentially?

Thanks, Alex. On receivables, last quarter, if you remember, we had, you know, close to breakeven operating cash flow as we saw several customers somehow pay before Christmas. I will say that's very unusual, they ended up, you know, submitting payment before Christmas. We noted last quarter that the receivables and the dynamics of working capital were very favorable. They reverted this quarter. It's just temporary as, you know, some of those customers had paid early, we expect that to revert next quarter. Just some interesting dynamics here as you start to follow some government payment timelines. I mean, nothing fundamental. It's just really a timing issue.

Perfect. Thank you.

I'll now turn the call back over to Daniel Ramot for closing remarks.

Thanks everybody for joining the call. We really appreciate it and look forward to the next call next quarter. Thank you.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.

Good morning, and welcome, everyone, to Via's Fourth Quarter 2025 Earnings Call. I'm Gabby McCaig, Via's Chief Corporate Communications Officer and Head of Investor Relations. With me today are Daniel Ramot, Via's Co-Founder and CEO; and Clara Fain, Via's Chief Financial Officer. During today's call, Daniel will review our fourth quarter 2025 business update before handing it off to Clara to discuss financial results and our guidance for the full year 2026. Daniel will end with some additional comments before opening it up to Q&A. In addition to prepared remarks on this call, additional information can be found in our investor presentation, press release and SEC filings on our Investor Relations website at investors.ridewithvia.com. Before we get started today, we wanted to draw your attention to the safe harbor statement included in our press release and investor presentation. Items we discuss today will include forward-looking statements about topics, including, but not limited to, our future financial performance, projections and management's plans and objectives for future operations. Actual results may differ materially from those presented in the forward-looking statements and are subject to risks and uncertainties described more fully in our SEC filings, including our annual report on Form 10-K. Any forward-looking statements that we make on this call are based on our assumptions as of today, February 27, 2026. Unless required by law, we undertake no obligation to update or revise these statements as a result of new information or future events. We would also like to point out that our discussion today will include certain non-GAAP financial measures in addition to, not as a substitute for, financial measures calculated in accordance with generally accepted accounting principles. Definitions of these non-GAAP financial measures, along with reconciliations of non-GAAP to GAAP financial measures are provided in our press release and our investor presentation. And without further ado, I'll now hand it over to Daniel.

Thanks, Gabby, and thank you, everyone, for joining us today. We're delighted to report that Via delivered another exceptional quarter, exceeding expectations on both top and bottom line performance. In Q4, our revenue grew 30% year-over-year to $119 million. This was the eighth consecutive quarter with year-over-year platform revenue growth at or above 30%, highlighting Via's ability to consistently deliver rapid, durable growth. Q4 was the strongest quarter in company history for net new platform revenue. This outstanding result was driven by our relentless focus on product innovation and our ability to deliver to our customers not only the most cutting-edge technology in the market, but also the solution that best matches their needs. The number of customers on our platform grew sharply in Q4 to 821. We saw strong organic customer growth of 9% year-over-year, and we added 94 new customers through our acquisition of Downtowner, an important expansion of our platform and exciting opportunity for future growth. We also remain highly focused on maintaining our progress towards profitability. In Q4, we had the narrowest loss in Via's history at negative 6% of adjusted EBITDA margin. 2025 was an outstanding year for Via. Not only did we take the company public and acquire Downtowner, we also achieved rapid and consistent growth throughout the year and continue to invest in our product and team to support durable growth in the years to come. In 2025, we grew platform revenue 31% year-over-year to $434 million. Adjusted EBITDA improved year-over-year by 8 points to negative 8%. In Q4, we continue to win new customers at a rapid rate. We are seeing strong growth in the number of large customers who adopt our platform across the U.S. and globally, in part driven by an acceleration in the number of cities and transit agencies selecting Via to manage their entire transit network. As has been consistently the case throughout Via's history, we saw exceptional retention and growth from our existing customers. For the past year, Via's net revenue retention was 119%. We also recorded the highest gross revenue retention in Via's history, 98%, beating the previous record set just a quarter earlier in Q3 2025. Our incredibly low churn is the result of the meaningful impact in ROI we deliver to our customers and the consistency with which we do so. Sarasota County, Florida has been a Via customer since 2021 when we partnered with the county to launch a new microtransit system. At the time, the county trimmed 15 underutilized bus routes and used those savings to fund the microtransit service. For the same annual budget, Sarasota was able to significantly expand the reach of their public transit network, shorten passenger wait times by 4x and reduce cost per ride by 50%. Further savings of $700,000 annually were achieved by leveraging the microtransit system to serve transportation disadvantaged riders, a service that was previously provided by a separate fleet. Breaking down operational silos is a key advantage that Via platform provides to our customers. This success led to Via being awarded a paratransit software and services contract, representing a 6.3x expansion of our contract. We can now leverage our unified platform to integrate the microtransit and paratransit services and drive even greater savings for the county. I wanted to share another case study that demonstrates the outstanding ROI that our customers can achieve when they adopt our platform. An agency in Missouri was able to reduce cost per ride by more than 50% from $75 to $30 when integrating paratransit and microtransit through our platform. This translates into $2 million of savings per year for the agency. One of our key goals for the IPO was to gain the ability to leverage our public company stature and balance sheet to strategically acquire assets that broaden our platform and global reach. We're very pleased that in Q4, just 3 months after the IPO, we made our first such acquisition. We have been following Downtowner and its founders for many years and have been impressed with their execution and product. We also recognize a strong cultural fit between our teams, which is a critical consideration for every acquisition we evaluate. Over more than a decade, Downtowner built a specialized business focused on efficient public transit solutions for Destination Cities. The Downtowner team developed innovative tools, deep expertise and proprietary data to manage the complex geography and weather conditions, seasonal demand patterns and local commuting needs of these unique environments. In acquiring Downtowner, we gained direct access to these tools, expertise and data, which we can now leverage to expand our platform. We also gained 94 new customers. We believe that many of Downtowner's customers have additional transit technology needs that are well served by Via's platform. The average ARR per Downtowner customer is significantly lower than Via's current ARR per customer, providing an exciting opportunity for growth within the Downtowner customer base. We believe that in the current market conditions, targeted and selective acquisitions such as Downtowner represent an attractive opportunity and sound capital allocation strategy for Via. Product innovation is a key driver of our growth. In 2025, our product development accelerated meaningfully. Our team of 400 engineers, product managers and data scientists released more than 50 new products and major features during the course of the year. A key driver of product acceleration was our use of AI to increase the efficiency of our engineering and product teams. The faster rate of product innovation has allowed us to increase the pace at which we expand our product portfolio and broaden our platform, an increase that is already having a measurable impact on our business. Our pipeline grew more than 50% year-over-year in 2025. While we have always used machine learning to power algorithms, we are now embedding AI across our platform, automating key workflows, improving the learning and decision-making of our algorithms and leveraging Via's proprietary data to generate deep insights and proactive recommendations for our customers. We are setting the industry standard when it comes to developing AI for government, providing solutions that meet the exceptionally high bar for accuracy, reliability and security that is necessary when powering critical public services. We know there's a lot of talk about AI. We wanted to go beyond talk and show you some of the AI products we're rolling out to our customers. As you'll see, the proprietary data we've amassed over more than a decade is a critical foundation underlying many of these products. First, let's take a look at our tool for automating the design of transit networks. Using AI, we leverage publicly available demographic data alongside Via's travel demand, rider mode choice and other proprietary data to generate an optimal bus network. Once we've established the optimal bus network, the AI can turn its attention to the microtransit component of the system. You can see the AI in action as it evaluates a large number of potential zone designs before converging to the optimal microtransit zones. This is a powerful new planning tool that has the potential to revolutionize how transit networks are planned. We have also embedded AI into our operations software, where it monitors the system's operations to proactively generate insights and recommendations. Here, we see insights generated by the built-in agent based on ridership demand data. Each insight leads to an AI-powered recommendation. Planners can rapidly visualize the data in forming the recommendation and take immediate action. In this case, expanding the microtransit zone to cover a whole foods that is driving a lot of ridership. Once the zone change is made, it goes live immediately, allowing riders to travel directly to the whole foods. The same tool also continuously evaluates system safety. Here, we see another AI-generated insight, identifying an unsafe virtual bus stop. With a click, the planner can access satellite footage to review the location. In this case, the planner determines the stop is indeed unsafe and easily removes it from the system. Dispatchers often need to deal with unexpected disruptions. Our AI agent can assist them, transforming potentially challenging and stressful real-time decisions into a human-AI collaborative process that is well informed and seamless. In this example, the dispatcher needs to secure a new ride for a passenger whose vehicle is broken down. The AI agent helps the dispatcher quickly understand how assigning the passenger to a new vehicle will impact other passengers already on that vehicle. The AI agent then facilitates the assignment selected by the dispatcher. Our target market is unique and very few companies that sell into this market and have been able to achieve meaningful scale. As the category leader and thanks to the proven impact that our platform has delivered to cities, we've been able to develop strong relationships with mayors, city managers and other key municipal decision makers. This is evident in the outstanding bipartisan group of mayors who are the inaugural members of our newly launched Mayors Council. The goal of the council is to support transit innovation in the U.S. and facilitate adoption of modern transit technology and innovative transit approaches by mayors across the country. We are confident that the support of mayors on the council will prove instrumental to accelerating adoption of smart transit solutions in cities throughout the U.S. Our market is massive, and we have only begun to penetrate it. Based on a report we commissioned from a major consulting firm, our serviceable addressable market is estimated to be $82 billion. Today, we capture a little over 1% of this market. Across this massive global market, there is an enormous gap between the antiquated technology that government organizations have historically relied on and the cutting-edge software we have developed. This gap is rapidly expanding, in large part, thanks to AI. We believe that transforming this market represents a generational opportunity. It is also a market with a unique set of challenges. While our customers are mission-driven and motivated to provide high-quality service to their constituents, they are burdened by cumbersome procurement and regulatory constraints. They also have many complex and bespoke technical requirements that are essential to their operations. We've spent over a decade developing a deep understanding of these customers. One of our most important early insights was that our customers need so much more than better software. They need better solutions. We learned that the standard seat-based SaaS model will not drive durable growth or achieve meaningful scale when the customers are local governments. That is why we have, from the very beginning, been steadfast in our approach. We must provide our customers not only cutting-edge software, but a complete solution. To do this, we adopted a novel innovative approach to our market. We built an end-to-end platform of software and services. Our platform comprises the world's most advanced AI-powered software for public transit systems. It also incorporates a broad range of technology-enabled services, many of which are provided through a curated ecosystem of third-party providers that we assembled over the years, and it is priced based on usage, not seats. As Via grew, we often faced skepticism about our model. Wouldn't it have been so much simpler to just sell software. But we made what I believe has proven to be a prescient decision to look beyond the traditional software model. Our platform approach enabled us to grow rapidly and become the undisputed leader in our category. Our scale affords us a tremendous data advantage over existing players and potential newcomers to the space. And the services we provide ensure that our platform is tightly linked to the physical world, which we believe will ensure that Via emerges as a long-term beneficiary of AI. One powerful case study for how our platform can leverage AI is our use of autonomous vehicles. By incorporating AVs as a service into our platform, as we've done with Waymo and Chandler, Arizona, we will be able to drive increased margins in our operations and deliver savings for our customers as the cost of AVs declines. Perhaps most interestingly, as we work closely with local government organizations around the world, we've seen how badly they need smart AI-powered solutions in virtually every aspect of their internal operations. We've spent the past decade establishing Via as a company that can deliver complex solutions that really work for the public sector. In the process, we've built strong relationships with mayors and senior city officials the world over. Today, with AI dramatically speeding up product and software development, we're exceptionally well positioned to build on these relationships and partner with mayors and city managers to build AI-powered solutions that extend well beyond public transit. This new initiative is Via AI Labs. Just launched out of stealth, it's already clear that we have a huge opportunity to help cities use AI to solve some of their most pressing challenges efficiently and scalably. As we look forward to 2026, we couldn't be more bullish about the opportunity to leverage our engineering team and category leadership in public transit to meaningfully expand the range of solutions we provide to local governments and help drive efficiency across multiple areas of municipal government. And with that, I'll pass it over to Clara to review the financial highlights for the quarter and the year.

Thank you, Daniel. We are very pleased to wrap up our first year as a public company with another remarkable quarter. Q4 net new revenue was the strongest in the company's history, and we exceeded our revenue and adjusted EBITDA guidance, showcasing our commitment to consistent execution and durable growth as we continue to capture the massive opportunity ahead of us. Now let's dive into the results. In Q4 2025, our annual run rate revenue, which is defined as our quarterly revenue multiplied by 4, was $476 million, representing a year-over-year increase of 30%. This marks our eighth consecutive quarter of 30% plus year-over-year revenue growth for our platform. Our growth continues to be fueled by exceptional strength in the United States with platform revenue up 39% year-over-year in the U.S. In Q4 2025, the number of customers leveraging our platform was 821, representing a year-over-year increase of 23%. Our year-over-year organic growth was 9%, in line with our historical range of 8% to 12%. In addition, we acquired Downtowner, our first acquisition as a public company in late December. This added 94 customers to the platform. In Q4 2025, excluding Downtowner, revenue per customer was the highest in Via's history as more customers than ever expanded their usage and adopted multiple products on our platform. We ended the quarter with 94 customers with annual run rate revenue over $1 million, a 31% year-over-year growth. In 2025, we generated 97% of revenue through recurring fees for access to the platform. Our contracts are typically multiyear, 2 to 3 years on average with additional option years. Our contracting unit is typically the vehicle, whether the contract is software or software and services, we offer bundled price per vehicle per month or per vehicle per hour. This allows our customers to easily scale their usage of the platform. Upfront or onetime revenue is very limited, representing less than 3% of total revenue in 2025 and often consists of software implementation, consulting, hardware or advertising fees. As an example, a customer in Texas contracted for $3.4 million over 3 years. The customer selected our microtransit software and tech-enabled services, including fleet, drivers and call center. The contract includes approximately 22,000 vehicle hours per year at a rate of $50 per hour. This brings the annual contract value of the contract to $1.1 million of annual recurring fees. An annual inflation escalator of 3% is automatically applied in the second and third years of the contract. The contract also included $15,000 of upfront software implementation fees recognized over the life of the contract. We are continuing to benefit from flywheel effects in multiple states such as Ohio and Illinois, where the success of existing customers drives referenceability and allows us to rapidly grow revenue without a corresponding increase in sales and marketing investment. In Ohio, we have seen an 1,800% increase in revenue per sales head with S&M decreasing over time. We ended 2025 with 19 states in flywheel, representing a 73% growth year-over-year. Now let's dig into our margins and expenses, which we're presenting on an adjusted basis. As of Q4 2025, we spent 13% of our revenue on sales and marketing compared to 15% in Q4 2024. Over time, we expect to continue to invest efficiently in S&M to capture our market opportunity. We also spent 15% of revenue on G&A, which was consistent year-over-year. Our G&A expenses went up quarter-over-quarter, driven by a onetime step-up of expenses related to our transition from private to public company, professional services, legal and infrastructure costs as well as increased auto and D&O insurance costs, which both renewed at higher rates. Our research and development efforts are our #1 area of investment. As of Q4 2025, R&D expenses represented 18% of revenue compared to 21% in Q4 2024. Our engineering team continues to gain efficiency by extensively leveraging the most advanced AI coding tools. And it is worth noting that our R&D spend as a percentage of revenue declined meaningfully in 2025 despite the weakness of the U.S. dollar versus the Israeli shekel, the currency of our largest R&D center. We wrapped up Q4 2025 with negative 6% adjusted EBITDA margin, our lowest loss on record compared to negative 10% in Q4 2024 and negative $0.5 million of operating cash flows, driven by improved financial performance and favorable timing of customer collections. Over the past few years, we have been able to drive significant operating leverage while generating rapid revenue growth. We strongly believe that we can continue to execute at the same level in 2026. Now let's turn to 2026 guidance and our long-term plans. For the first quarter of 2026, we expect revenue to be between $123.3 million and $123.8 million, representing 25% to 25.5% year-over-year growth. We expect adjusted EBITDA margin to be between negative 5.9% and negative 5.5% with adjusted EBITDA between negative $7.25 million and negative $6.75 million. For the full year 2026, we expect revenue to be between $542.9 million and $545.1 million, representing 25% to 25.5% year-over-year growth. We expect adjusted EBITDA margin to be between negative 2.3% and negative 1.4% compared to negative 8% in 2025, with adjusted EBITDA between negative $12.5 million and negative $7.5 million. Additionally, we expect to deliver our first quarter of profitability in Q4 2026 with positive adjusted EBITDA, which will be a major milestone for Via and an important step on our path to delivering great returns to our shareholders. Finally, we wanted to reiterate our commitment to our long-term financial goals to achieve 20% to 25% in adjusted EBITDA margin. Now I'll pass it back to Daniel for some concluding remarks.

Thank you, Clara. I just wanted to reiterate again how pleased we are with this quarter and the full 2025 year performance. 2025 was a banner year for Via, capped by milestones like our IPO, continued 30% plus growth and an incredible velocity of impactful product development. However, we are still in the early days of transforming the massive and hugely important public transit market, not to mention the opportunity to enable local government efficiency more broadly. And I'm confident in our ability to continue to deliver strong performance in the coming years. With that, I wanted to thank you all again and turn it back to the operator so we can take some questions.

[Operator Instructions] Your first question comes from John DiFucci with Guggenheim Securities.

Since it's one question, I was -- I'll let someone else ask the AI question. So I'm going to go on to something here, something else. Listen, we've done a ton of work on Via. And by the way, this looks really good. So nice job on this quarter and the guide. And we've done a ton of work here on the space lately and realize there's a lot out there that you can do because your customers are public, and so they -- all that stuff is public, you just have to find it. It just takes a lot of work. We also realize in doing this, there's a lot of FUD out there that when taken out of context can be somewhat misleading. So we -- like we see Via as a software-led solutions company. Although there's some stuff out there, I think, with some investors wondering how much services comes into that. We think it's really important as Daniel did a good job explaining that today in your prepared remarks. But I think there's one large customer out there with contracts that are services. That customer, I think, also buys software from you. But I'm just curious, is this somewhat of an anomaly that is services-only contracts that aren't coupled with software? Or is it more common to see in your business?

John, thanks for the feedback and the question. You're absolutely right. That specific contract that I believe you're referring to is an anomaly, and it's an outcome of a very specific set of circumstances. Generally, we don't see anything like that in the market across the U.S. or Europe or any of our other markets. We're very focused on selling, as you said, software-enabled solutions. And as I tried to explain in my prepared remarks, as you commented, we think it's absolutely critical to the business model and other companies that have attempted to do it a different way, come in with your standard SaaS model or just insist on selling software. I don't think have been able to scale in any meaningful way. And so this is just -- in our view, this is the way to conquer this market. It's a huge market. And I think with AI coming in, some of this is looking even better than it was before as far as resilience and the opportunity, frankly, to leverage AI to deliver even better results to our customers.

And I think that the unique circumstances around that contract, I think we're fully aware of, and anyone that wants -- we have all that information that's out there. Nice job.

And thank you also for all the work that you did on that. That report was excellent and really enjoyed reading it.

Your next question comes from Adam Hotchkiss with Goldman Sachs.

I guess, Daniel, to start, as you enter '26 and think about the '26 guide, how should we think about what the RFP pipeline looks like in public transit? What are the mix of deals available out there this year versus what you did in '25? And then maybe, Clara, what are the puts and takes around margins from a mix perspective, particularly on the gross margin front?

Adam, thanks. What we're seeing as far as RFPs coming out of the public transit systems, agency, cities and so forth, if I take a step back and look more broadly, it's pretty consistent year-over-year. For us, what's interesting is that the number of these opportunities today that we're able to go after versus a year ago, feels much larger because of the expansion of the solutions that we're able to provide, the scale that we're at, frankly, the IPO, I think, has really helped as well. And so we're just seeing -- of the RFPs that are coming out of the opportunities that become available, if I try to estimate what percentage of those can we go after at this stage in early '26 versus, say, early '25, it feels like a significantly larger percentage, and you're seeing that in that pipeline number that we disclosed. So you're seeing both more opportunities and then they tend to be larger opportunities just as far as you're asking about the mix. We're increasingly seeing opportunities to take over entire transit networks that we're today feel very well positioned to go after and are winning. So that's the good sign. So I think we feel very bullish about that pipeline of opportunities coming into 2026.

On the gross margin question, as you saw, the gross margin was consistent quarter-over-quarter, slightly up. The breakdown of the mix of customers buying services was also consistent with about 20% of our customers buying services as well as software. In the long term, we're reiterating our commitment to our 50% target. As Daniel mentioned, the services we provide are core to the business, and they're actually particularly important in the context of AI. We've discussed before that we have multiple levers to get to 50%. But we've also discovered that we have some new levers which are coming faster than expected, Adam, and one of them is AVs. Drivers represent a large chunk of our COGS, about 50%. And that alone could drive a paradigm shift that we're not really factoring into our assumptions. So all the levers are very much in place, and they will contribute over time to gross margin improvement. And in the short term, we believe that gross margin will be consistent with what we've been saying.

Your next question comes from Josh Baer with Morgan Stanley.

Congrats on a strong quarter. I wanted to ask one on the AI moats that you have, but actually not on the data sets and the technology, which I think should be really clear to everyone, and you did a great job demoing that and explaining some of your proprietary data sets. So I want to approach that from a different angle that's sort of unique, I think, to Via and your end market around go-to-market. What do you have -- like how would you characterize your go-to-market moat selling into this government customer base? Maybe a couple of ways to answer like what would it take for a new entrant to effectively sell to government transportation agencies and cities? And you talk about the years of work and investment building up your current go-to-market.

Josh, thanks for the question. I totally agree. There are multiple moats from an AI perspective that we believe we have. You mentioned some of them. I think the go-to-market is probably one of the less appreciated ones. This is a very -- there are very few companies that sell certainly at any scale into this market. It's not just the government market. I think I would just kind of go one level deeper and classify it as the local government, specifically in this case, focused on transit and public transportation. And access to that market is very challenging for a number of reasons. The regulatory requirements, the process itself is tough to get through and requires a huge amount of investment. And then in the end, there's a huge element of trust and relationship and understanding the decision-makers, knowing them. We've invested over a decade in doing that. If you were to come out to the U.S. conference, mayors with us and see the relationships that we've built with mayors across the country, that's not a -- it didn't happen to us. We created this through many, many years of investment and delivering solutions to them. And I actually think our business model factors into that as well. I think if we were just selling software, we would be another software vendor that they have across a list of -- a very, very long list of software vendors by being focused on solutions, by providing them sort of wrapping that go-to-market with consulting, with engineers that support them, with people on the ground to help with the deployment, just creates a huge level of understanding between our company and these customers that then allows us to accelerate our delivery and our go-to-market.

Your next question comes from Patrick Walravens with Citizens.

Daniel, I'm particularly interested on how you're using intelligence internally and where you see that going. And I'm sure everyone would love to hear your thoughts on Block announced last night that they're laying off 40% of their employees as they're leveraging intelligence across their country -- company. I mean I just wonder what your reaction is to that.

Thanks, Pat. That's a really interesting question. We're using -- so there's the obvious stuff. We're seeing incredible gains in efficiency and engineering. I think that's very clear. And I do think that's a paradigm shift in how our teams are working, the rate at which we're able to deliver new product. It's opening up enormous opportunities for us. And we're trying to use these tools, and I think they have been quite successful across the company. So whether it's sort of back-office operations, we've talked about before the way we respond to RFPs. These are extremely complex, I'd say, somewhat convoluted processes that often require hundreds of pages of responses very, very formal and structured. And so the ability to deploy AI to support us in that process, for example, has led to some really nice gains. So across the company, we're trying to deploy these. On the question of how does that affect headcount, I guess it depends what kind of market you are. Our feeling is that in our market, we are just scratching the surface as far as the number of customers that we're able to get to. We're just above 1%. But also within those customers, what we could offer them that at least for me, any gain in productivity that we can achieve, I would like to turn into selling more stuff to more customers faster rather than trying to use that to cut the team in any dramatic way. I guess if you're in a different market and you don't have that opportunity, then maybe that's the right calculus for you. For us, any centimeter -- percent of gain that we can get, we're just going to deliver more value to our customers and I think accelerate our penetration of this market that -- it's not easy to get into this market as I described before. So that's the opportunity that we're trying to pursue rather than necessarily using that to cut our team.

Your next question comes from Brian Peterson with Raymond James.

Congrats on the results. So Clara, I wanted to understand on Downtowner, how we should be thinking about the financial contributions for 2026. And as we think about M&A opportunities, how does that pipeline look for the next couple of years?

Brian, thanks for the kind words and for the question. The Downtowner acquisition was not about the revenue contribution. We acquired them to penetrate the Destination Cities market and add 94 customers. And those customers are quite small today, but they have the potential to adopt the entire Via platform. So we're pretty bullish on that and the opportunity there and that we're very excited about. On your general question about M&A, we're particularly excited about the M&A opportunities ahead of us. There's a dislocation in the market, and our industry is not immune to that. And so we're going to continue to be very disciplined, but we're seeing lots of opportunities in the market at attractive prices.

Your next question comes from Brad Zelnick with Deutsche Bank.

I guess just with a number of new wins in the quarter, can you tell us how regional network effects played a part in winning new business in what sounded like a strong U.S.-led quarter? And also, how are things progressing internationally?

Brad, thanks for the question. We were really pleased with the flywheel effect that we're seeing. I think we're sharing two new examples in the earnings today with Ohio and Illinois. And you can see we're seeing an acceleration of revenue at a much faster pace in those flywheel markets. So we have about 19 states that we consider flywheel today in the U.S. So we're getting started. And as we continue to concur more states, we should see accelerations in those markets as well. So we're pretty excited about it. And I would say this is playing out the referenceability and the flywheel effect are playing out as expected. And you can also derive that in our S&M as a percentage of revenue, which has been continuing to come down despite having a record quarter from a net new revenue perspective. You pointed out that the growth has been fueled by the U.S. The U.S. was up 39% this quarter year-over-year. So we're continuing to see really strong results in the U.S. And our pipeline is definitely reinforced up more than 50% year-over-year, reinforced by that strength in the U.S. market.

Brad, I can comment on Europe. Europe is a complex picture, a very interesting and complex one. We have some markets that are strong like the U.K. and then other markets where we're facing some headwinds like in Germany. To try to understand what's happening in Germany, maybe I'll describe the following. We first entered the market, which is typical the same as we did in the U.S. and other places with microtransit. As microtransit is adopted, what we're trying to then transition into is a state where the more and more of our platform is being adopted by those customers. So planning and then eventually that they're acquiring our entire platform. And that is for us to get to that next stage of growth, if you will, that's the transition that's required. In Germany, we were very successful in introducing microtransit. That next phase where adoption of our entire platform is becoming ubiquitous from a change perspective, a regulatory perspective, with the European structure is just proving to take longer than we would have liked, certainly and longer than it took in the U.S. So in Germany, we're just at this interim phase. We're still selling microtransit. We're trying to get to that next level of being able to sell the entire platform. And that really requires -- for that to happen, it requires our customers to change their network to reduce certain fixed routes, replace them with microtransit, combine services that have previously been siloed. That is just -- with the regulatory environment in Europe, it is just proving to be a longer process. I think it's inevitable. We're confident that it is going to happen. It just may take a little bit longer for us to break through and then hopefully see that acceleration come up again.

Your next question comes from Alex Zukin with Wolfe Research.

Congrats on a solid report. Maybe for Daniel and Clara for both of you, I think you both mentioned opportunities, specifically both on the new product side with some of the AI-powered software that you're introducing. And Clara, you mentioned some opportunities with the autonomous vehicle adoption that should be pretty gross margin accretive, I think maybe a little bit even sooner than what we had in our models. And I'm curious kind of how we should think about that playing out for the coming year. Obviously, we have the guidance. If you could comment on kind of where the investments are for the coming year over and above what we kind of had in our model. And how we should think about gross margin progression, particularly through the year as we look at the guidance based on those products coming to market.

Alex, thanks for the question. And I think you're right to point out that there are some potential step function changes to gross margin from organic efforts around AI and autonomous vehicles. The timing of those is quite interesting to think through. I would say in the very short term, we believe that gross margin will be consistent with what we're seeing, but has the potential to have step function improvement from these levers. And these levers definitely include AI products at scale where we're seeing really nice opportunities as well as the acceleration of the AV rollout with some of our AV partners. And again, we're feeling increasingly confident that, that will happen. In the future that may not be in the next quarter or 2, but it's not too distant either.

Your next question comes from Michael Turrin with Wells Fargo.

You mentioned starting the year with record pipeline. You're also guiding for very stable growth throughout this year. So I was just hoping you could give us a bit more context around what drives the consistent growth profile you're expecting throughout the year, the visibility you have into what you're guiding for? And then also, how should we think about timing in this market around converting pipeline to bookings and revenue? I'm just aiming to tease a bit more around the durability of the growth profile you're expecting for investors here.

Thanks, Michael. That's actually an insightful question. I'm glad you asked the question. It's worth remembering the model that we're in. We are selling long-term contracts that are multiyear with committed budgets and volume kickers to our customers, meaning that as we sit today, we have over 95% visibility in our revenue guidance for the next 12 months. Meaning that most of the revenue is coming from deals that are already live, contracted or won and about to be contracted. So we have really high visibility into the guidance that we've shared. Now looking forward, we are -- the pipeline is an interesting leading indicator where we're seeing an increasing pipeline of over 50% starting this year. It takes on average 9 to 10 months from a deal to get from opportunity creation to close. So that pipeline on average should convert throughout the year, but really towards the second half of the year, and it's really a good indicator for the demand that we're seeing for 2027. That's how we think about it internally. Obviously, it's on us to execute on the pipeline with the existent win rates to be able to deliver the durability of the growth, but the leading indicator is there.

Your next question comes from Jonathan Ho with William Blair.

Congratulations on the strong quarter. I just wanted to understand a little bit more about AI Labs and the opportunity that you see sort of with that launch. And what sort of drove the decision? Like what are customers specifically focused on achieving with AI?

Thanks, Jonathan. Really appreciate the question. It's been -- for a very long time, we've been thinking that the access that we have to our customers at the highest levels of municipal decision-making is pretty unique and something that we should be able to leverage to diversify and grow into other areas. The challenge has always been that there's so much to do in our own space in transit, so many new products to build, solutions to develop that we've never quite had the bandwidth to do that and go into these other areas, and we want to remain very focused. What we're seeing with AI and this acceleration in our ability to build product very, very quickly is that all of a sudden, we have a way in a scalable way, not just one-off things that we then can't scale to build solutions that extend beyond transit. And we are hearing from our customers in many conversations that in addition to transit, they're saying to us, if you could do what you did for us in transit in the way we -- I mean, I'll just throw out a couple of examples, the way that we process small business applications, how we deal with sanitation, that would be transformational. And no one else is really doing that for us and no one understands these needs. These are conversations anywhere from mayors to city managers, city council members, but all the way down to staff. And so we've seen these opportunities. I think what's unique about this period is that we have the ability to go after them in a way that I think can be very successful and scalable. And so that's what we're trying to do.

Your next question comes from Scott Berg with Needham & Company.

Congrats on a really nice quarter. I wanted to focus on the gross retention metric at 98% that you said was your best ever, certainly would be one of the best in my coverage universe today. But did you do anything different in 2025 to help power those results? And how do we think about your assumptions around gross retention into your '26 guidance?

Thanks, Scott. Thanks for the question. We've been executing at very high levels of gross revenue retention forever. So part of it is the mission criticality of the platform. But I think this quarter, we reached a record high gross revenue retention, particularly because our customers are benefiting from the entire platform. So as we sell more products to our customers, we are seeing an increasing gross revenue retention with these customers, and it just increases the strength of the platform. So as we think about why we're getting to these levels of retention, I think it definitely comes back to the ubiquity of the platform and our ability to sell more products to these customers and having them benefit from them as we continue to scale.

This concludes the question-and-answer session and we will conclude today's conference call. Thank you for joining. You may now disconnect.

Thank you for standing by. My name is Tina, and I will be your conference operator today. At this time, I would like to welcome everyone to the Via Third Quarter 2025 Earnings Call. [Operator Instructions] Thank you. It is now my pleasure to turn the call over to Via. The floor is yours. [Presentation]

Good morning, everyone, and welcome to Via's Third Quarter 2025 Earnings Call. I'm Gabby McCaig, Via's Chief Corporate Communications Officer and Head of Investor Relations. With me today are Daniel Ramot, Via's Co-Founder and CEO; and Clara Fain, Via's Chief Financial Officer. During today's call, Daniel will review our third quarter 2025 business update before handing it off to Clara to discuss financial results and our guidance for the full year 2025. Daniel will end with some additional comments before opening it up to Q&A. In addition to prepared remarks on this call, additional information can be found on our investor presentation, press release and SEC filings on our Investor Relations website at investors.ridewithvia.com. Before we get started today, we want to draw your attention to the safe harbor statement included in our press release and investor presentation. Items we discuss today will include forward-looking statements about topics, including, but not limited to, our future financial performance, projections, and management's plans and objectives for future operations. Actual results may differ materially from those presented in the forward-looking statements, and are subject to risks and uncertainties described more fully in our SEC filings, including our S-1 and quarterly report on Form 10-Q. Any forward-looking statements that we make on this call are based on our assumptions as of today, November 13, 2025. Unless required by law, we undertake no obligation to update or revise these statements as a result of new information or future events. We would also like to point out that our discussion today will include certain non-GAAP financial measures in addition to, not as a substitute for, financial measures calculated in accordance with generally accepted accounting principles. Definitions of these non-GAAP financial measures, along with reconciliations of non-GAAP to GAAP financial measures are provided in our press release and our investor presentation. And without further ado, I'll now hand it over to Daniel.

Thanks, Gabby, and thank you, everyone, for joining us today. We're delighted to host our first public company earnings call, and we're very pleased to report that Via delivered another strong quarter, exceeding expectations on both top and bottom line performance. In Q3 2025, our revenue grew 32% year-over-year. Platform annual revenue run rate, which is our quarterly platform revenue multiplied by 4, was $439 million. The number of customers on our platform grew to 713, a year-over-year increase of 11%. Our results demonstrate the durability of our growth as we transform a vital and underpenetrated market, and customers increasingly embrace our cutting-edge platform. To provide additional insight into our performance, the increase in revenue in Q3 was driven by strong growth in our government business. Revenue from government customers increased by $26.5 million or 34% year-over-year. We also saw outstanding results in the United States. Revenue from our U.S. customers increased by $23.1 million, or 42% year-over-year. Taking a step back. Via provides the world's most advanced platform of software and services, transforming antiquated public transportation systems into efficient digital networks. We've built a single unified platform that replaces fragmented legacy systems across multiple transit verticals. Our platform automates key workflows, consolidates operations across verticals that have historically operated as a distinct silos. Via's vertical stack is deployed globally. It can be configured to support the broad and diverse local requirements of our customers without the need for software customization. We are fundamentally transforming the way governments and cities operate through automation, advanced algorithms, data and AI. Transit is a critical public service. In the United States alone, public transit systems provide 8 billion trips each year, and yet 45% of Americans do not have access to transit. For anyone who cannot afford a car, this gap severely limits their ability to get to jobs, educational opportunities and health care. We believe that after decades of underinvestment in technology, cities across the globe are poised to upgrade their -- and digitize their transit infrastructure. This transformation is already in progress and will only accelerate in the coming years. In our core geographies of North America and Western Europe, our serviceable addressable market is estimated at $82 billion, based on a report commissioned by us from a major consulting firm. Today, we capture less than 1% of this market. We also estimate that there are approximately 63,000 potential Via customers in North America and Europe. As of Q3 2025, we had 713 customers on our platform, representing approximately 1% of these potential customers. As the established category leader, we're extremely well positioned to capitalize on the digital transformation taking place within our core markets, and we are still in the early innings of capturing this very large opportunity. More than 90% of our revenue is derived from selling our solutions to cities, transit agencies and similar government organizations. Public transit generally and Via services, in particular, are in the unique position of enjoying broad bipartisan political support. One way to visualize this. In the U.S., 55% of Via services are in red congressional districts and 45% are in blue congressional districts. This bipartisan support has helped ensure that as reported by the American Public Transportation Association, funding for public transit has grown an average of 4% per year since 2012. This trend appears to be continuing with the Trump administration's latest 2026 budget proposal, including a $310 million increase in federal funding for public transit. Bipartisan support for transit extends well beyond the federal government. This is critical since more than 80% of government funding for Via services is provided at the state and local levels. We have consistently seen a broad consensus by voters in support of public transit in local elections. Earlier this month, 16 of 19 public transit ballot measures successfully passed, approving a total of $11.8 billion in transit funding. In addition, several major pieces of legislation in support of public transit have recently been passed by state and local legislatures, including in Illinois and Oregon, where billions of dollars in transit funding were approved. Importantly, we have not seen any impact from the federal government shutdown on Via services. At the Federal Transit Administration, it is our understanding that no employees were furloughed during the shutdown. Let's take a couple of minutes to deep dive into the Via platform. Over the past 13.5 years, we have, in a very deliberate way, through organic investments and strategic acquisitions, built a comprehensive end-to-end category-defining platform of software and services for public transit. Our platform is highly modular and can support the transit needs of any size city or community, from rural to suburban to major metropolitan centers. We provide software that allows transportation planners to design more livable cities. A one-stop shop for planning and scheduling both fixed routes and dynamically routed transit networks. Transit planners can leverage models trained on billions of data points to rapidly quantify the impact as they make changes to their network. Once a city, or transit agency, has planned its transit network, it can, with a click of a button, begin operating that network using our operating software. Via's operating software supports multiple transit verticals, including microtransit, paratransit, school transport and nonemergency medical transportation. Our software is powered by advanced algorithms and AI, which are used by customers to digitize and automate work streams across passenger reservations, dispatch customer support, program eligibility, government reporting and compliance. We also provide consumer-grade mobile apps and web-based interfaces for passengers to seamlessly plan, book and pay for their transit journeys across multiple modes of transit. When customers adopt our platform, their ability to visualize their data and derive actionable insights from that data greatly expands. This improved access to data can be transformational. Our analytics tools include prebuilt dashboards that allow customers to track their essential KPIs. Our customers can also easily build their own reports directly within our products to create bespoke analysis, or to meet specific funding and compliance obligations. These tools are intuitive and easy to use, even for those who may not be as data or tech savvy. In addition to software, our platform includes a suite of technology-enabled services which facilitate and accelerated adoption of our software. 100% of our customers buy our software. Approximately 20% elect to also procure services. These services are delivered to our customers by a curated ecosystem of third-party providers, or in some cases, directly by Via. Our ability to provide services alongside our software is a critical element of our customer-centric go-to-market strategy. Our services enable adoption of our software, allowing us to win customers who lack the staffing or expertise to use the software, or leverage its full capabilities. Our services also increased the stickiness of our products and accelerate growth. And by broadening our platform and reach, they represent a strong point of differentiation in the marketplace. Via's platform is the product of an investment of hundreds of millions of dollars and over a decade of intensive efforts in research and development. Our data is derived from multiple sources, publicly available data sets such as demographic information from the U.S. Census, and proprietary data produced by our hundreds of services across the globe. Over the years, we have collected billions of data points from over 150 million trips. As we expand our customer base, we also continue to scale our data advantage. We have leveraged this data to create the world's first LLM for cities, an AI model trained on our proprietary data, which provides multiple capabilities that can meaningfully improve the way transit planners design their networks. From ridership modeling to bus speed prediction, to proactive and conversational transit planning recommendations, a transit planning co-pilot, if you will. A recent and incredibly exciting example of Via's platform in action comes from Springfield, Ohio. I love this case study, as it illustrates the power of our end-to-end platform. First, using our transit planning software, the city was able to rapidly analyze their existing transit system and model the impact of potential changes to their network. What became very clear very quickly was that in Springfield, there simply isn't a sufficient population density to support buses. You can see the bus network on the left, with the circuitous routes typical of a transit system, trying to use buses to provide transportation in low-density areas, where buses don't really work. The small black icon you see on the map surrounded by a small blue area is Jane. We've dropped Jane in East Springfield and asked how far can she travel using public transit? With the original bus system, it's clear that she can't go very far at all. When the buses are replaced by Via's microtransit system, the picture is very different. Now on the right, Jane can access a much larger area of Springfield using transit, and a car is no longer a prerequisite to having a job or getting to school. Needless to say, this has real impact for Jane and more importantly, since Jane is fictional, for the residents of Springfield. Based on this analysis, Springfield decided to fundamentally redesign their transit network, replacing all of their buses with the Microtransit system powered by Via's platform. Now for the same annual operating budget, the city is able to provide transit access to 40% more of the city and has dramatically improved the passenger headways, reducing them by a factor of 4. For those of you who aren't transit nerds, passenger headway is the average time a passenger has to wait for a trip. This is a remarkable transformation for Springfield and its residents. Even more importantly, we know it is applicable to so many more cities in America. Our business is characterized by consistent and durable revenue growth. This growth is driven by landing new customers and by expanding within our existing customers. Expansion within existing customers is driven by both volume expansion, as customers add more vehicles or vehicle hours to the platform, and upsell as customers increase the number of modules included in their solutions. In Q3 2025, we continue to land multiple new and strategic customers. The launch of our microtransit service in Omaha is a great example of a partnership that goes well beyond the transit authority and extends into the local community. In this case, the services received key support from a local nonprofit that is keen to expand access to jobs and other opportunities for Omaha residents. The early success of our Omaha service rapidly led to another opportunity in neighboring Council Bluffs, Iowa, demonstrating the potential for strong regional network effects for our platform. Council Bluffs will launch a new and modern paratransit service, leveraging Via's platform in Q4. We have also seen an exciting acceleration of our business in the U.K., where government initiative to bring transit networks under control of regional authorities is meaningfully expanding the pool of potential customers seeking Via solutions, with Birmingham representing a key customer. In Q3, we also continued to grow rapidly within our existing customer base through both volume expansion and upsell. The city of Mobile, Alabama launched Via's microtransit solution in March 2024, building on that successful launch the city adopted Via's planning solution, which allowed it to critically analyze the performance of its transit network, unearthing that only 45% of residents and 55% of the city's jobs were accessible by bus. In Q3 2025, the city added Via fixed-route scheduling and paratransit solutions, and committed to implementing a full network redesign with a focus on streamlining bus service, expanding microtransit and hugely increasing access to jobs. In 1.5 years, we've grown revenue with this account by 17x. Looking ahead, we believe Via wins through innovation and more specifically, by continuing to innovate across three key areas: one, broadening our platform; two, deepening our vertical stack; and three, being nimble and creative on our go-to-market strategy. Broadening our platform, both through organic product development and strategic acquisitions, allows us to increase our competitive advantage, grow our share of existing customers' wallets and drive margin expansion through new higher-margin software products. As we develop new product capabilities and features for our customers, this deepening of our vertical stack drives customer satisfaction and increases the stickiness of our platform. Investing in go-to-market innovation allows us to reach new government customers and reduce our customer acquisition costs. We believe this growth framework is key to our continued success, and we consistently evaluate opportunities and initiatives through this lens. One area where we have been investing in broadening our platform is our newest vertical, student transportation. Q3 was a very strong quarter for this vertical, which saw more than 2x growth in the number of customers subscribing to our solutions. Our efforts in the schools vertical are still nascent, but we're very encouraged by the initial results and believe this can be an engine for growth in the future, as well as a template for expansion into other new verticals. In Q3, we added multiple new product capabilities and features to our platform. These new capabilities have been extremely well received by customers. We are relentless about innovation and continue to invest in all parts of our products, even those that provide well-established functionality to our customers. Last quarter, we rolled out major upgrades to our core dispatching interface, allowing dispatchers to more intuitively visualize vehicle routes, handle passenger queries and cope with delays and disruptions in real time. Whether they're a parent, case manager, or front desk staffer at an adult day care center, our Caregiver App allows caregivers to manage trips and receive real-time trip updates for the individual in their care. In our agent AI suite, new features help our customers streamline PDS manual processes. Tools like the eligibility application scanner, automate the processing of paper applications into digital files for assessment. Our agent chatbot is helping to automate how our customers handle passenger calls. We continue to roll out advanced self-service capabilities for our customers, shortening the loop between planning a new transit systems and deploying it. We're also very pleased to announce the launch of our European Advisory Council. The goal of the council is to bring together prominent leaders from the transit, technology and academic worlds to generate thought leadership on how integrated digital networks will transform the modern European public transport landscape. The 3-member board is chaired by Dr. Rolf Erfurt, CEO of Toll Collect, who previously served as a Chief Operating Officer and Board member for the BVG, the Public Transit Authority of Berlin. Additional founding members include Professor Andreas Hermann, Director of the Institute for Mobility at the University of St. Gallen, and Professor Barbara Lenz, Senior Advisor and former Director of the Institute of Transport Research at the German Aerospace Center. We believe this high-profile Board can play a key role in advancing transit innovation and digitization in Europe, and ensure public budgets continue to be directed towards this important area. Last, but certainly not least, we were pleased to announce a new strategic partnership with Waymo to advance the use of autonomous vehicles in public transit. There is no question Via has a key role to play in the introduction of autonomous vehicles into public transit. And our partnership with Waymo is a step in that direction. Through this partnership, government agencies using Via software can now incorporate Waymo's AVs directly into their public transit networks. Chandler, Arizona is the first city to benefit from this framework, integrating Waymo's service into the city's Chandler Flex microtransit service. Public transit riders and the government agencies who serve them are too often the last to have access to cutting-edge technology. We're delighted that this partnership with Waymo paves the path for AVs to become accessible to millions of global public transit riders, enhancing mobility, lowering operating costs and improving safety outcomes. And with that, I'll pass it over to Clara to review the financial highlights for the quarter.

Thank you, Daniel. We are very pleased with our performance in Q3, where we exceeded expectations across top and bottom line metrics. Now let's dive into our results. In Q3 2025, our platform annual run rate revenue, which we defined as our quarterly platform revenue multiplied by 4, was $439 million, representing a year-over-year increase of 32%. As a reminder, we generate revenue primarily through recurring subscription fees for access to our platform. Our customers subscribe to one or more solutions, which consist of the combination of software and tech-enabled services tailored to each customer's needs. All of our customers subscribe to our software and approximately 20% of our customers bundle tech-enabled services. Contracts with our customers are typically multiyear and structured with a committed budget and a volume-based component. Pricing is generally based on a number of factors, such as fleet size, minimum number of vehicles or total vehicle hours. Each contract comprises one bundled price for the combination of software and any tech-enabled services selected by the customer. We are very pleased with our revenue growth of 32% this quarter. As you can see on our historical performance, our quarterly revenue growth can fluctuate quarter-to-quarter. Our business is mostly driven by public procurements, which have a certain cadence, and happen when their existing contracts terminate, which is not always consistent throughout the year. Our revenue is highly predictable. The unique nature of our market, customers, combined with our leadership platform position, the contracting nature of our revenue and mission criticality of our products provide us with significant visibility into future revenue. At any given time, over 90% of our projected revenue for the next 12 months is contracted. This is a testament to the high quality and durability of our business model. Our rapid revenue growth is driven by landing new customers and expanding with existing customers. We delivered strong results on both fronts this quarter. In Q3 2025, the number of customers leveraging our platform was 713, representing a year-over-year increase of 11%. As you can see, our year-over-year growth in new customers has historically ranged between 8% and 12%, which aligns to the cadence of our unique market. We also continue to experience rapid growth with our existing customers, driven by a combination of volume and product growth, as well as continued stickiness of our platform. In Q3 2025, the majority of our 32% revenue growth was driven by growth with our existing customers, in line with our historical performance as a private company. In particular, I want to highlight our strong momentum in the United States, and with our core government customers. In the long term, we expect that our business will generate consistent and durable revenue growth as we continue to digitize one of the last pen and paper industries, and penetrate our $82 billion serviceable addressable market. Our sales and marketing efforts are highly efficient for a number of reasons. We're addressing a very large market, which provides many opportunities for growth with both new and existing customers. The breadth of our platform and our position as a category leader provides Via with a strong competitive advantage and drives meaningful expansion opportunities. The mission criticality of our platform and ability to generate meaningful ROI for our customers, combined with our ongoing investment in innovation, drive that stickiness of the platform. And last but not least, the particular nature of our customer base, government and government agencies create a virtuous cycle of growth through word of mouth and referrals. In Michigan, you can see on the slide, we have begun to experience a flywheel effect. While the success of existing customers in the state is driving new customer opportunities without the need to invest further in sales and marketing. As you can see, we have witnessed a 200% increase in revenue per head in that state, and a 20% decrease in S&M as a percentage of revenue, highlighting the incredible efficiency of our team in this market. Let's dive into our operating expenses, which we're presenting on an adjusted basis. As of Q3 2025, we spent 14.1% of our revenue on sales and marketing, compared to 15% in Q3 2024. Over time, we expect to continue to invest efficiently in S&M to capture our market opportunity. As of Q3 2025, we spent 14.4% of revenue on G&A, compared to 16.7% in Q3 2024. Our research and development efforts have been our #1 area of investment since the foundation of Via 13 years ago. We have invested over $500 million in R&D. And as of Q3 2025, R&D expenses represented 19.1% of revenue, compared to 24.7% in Q3 2024. We are now harvesting a decade-long investment in R&D. And as we continue to adopt AI, automate our processes and expand our product suite, there's a significant opportunity to increasingly drive efficiency in our R&D spend. As of Q3 2025, our adjusted gross margin was 39.6%, compared to 39.2% in Q3 2024. In the near term, we are focused on landing our market opportunity and penetrating our customer base further. In the medium to long term, we reiterate our commitment to an adjusted gross margin of 50%, driven by 3 levers: one, transitioning lower-margin services to third parties; two, continuing to expand our platform with higher-margin products, notably our software offering through internal development; and three, continuing to explore strategic and accretive M&A. As a reminder, we have established a playbook to execute on M&A with the Remix and Citymapper acquisitions, which were both highly successful on all counts. Our industry is highly fragmented, and there are many point solutions which will not make it as stand-alone companies in the long term, and might be excellent additions to our platform. Our IPO was a powerful moment for brand awareness and has generated significant inbound interest for potential M&A targets. With mature customers, we have a proven track record of successfully being able to increase gross margins over time. In this example, from a customer in the Western U.S., the customer started with a software and services microtransit solution in 2019. In 2022, the customer had reached a maturity, whereby they were able to contract for certain services directly, rather than through Via. We were also able to add additional product upsell to the partner for several higher-margin SKUs. In the past 3 years, we have been able to double run rate revenue on this account, while expanding gross margin from 40% to 50%. We believe that this is a formula we can successfully replicate with other customers as their accounts reach maturity. While generating rapid and durable revenue growth, we have benefited from significant operating leverage in the business. This operating leverage supported a continuous improvement in net loss margin and adjusted EBITDA margin. In the last year alone, between Q3 2024 and Q3 2025, our adjusted EBITDA margin improved from negative 17% to negative 8%. We are pleased about our continued ability to deliver operating leverage, as the business scales. Now turning to guidance. For the fourth quarter, we expect platform revenue to be between $114.6 million and $115.1 million, representing 25% to 25.5% year-over-year growth. We expect adjusted EBITDA to be between negative $7.5 million and $8.5 million, and adjusted EBITDA margin to be between negative 6.5% and negative 7.4%. For the full year 2025, we expect platform revenue to be between $430 million and $430.5 million, representing 30% to 30.2% year-over-year growth. We expect adjusted EBITDA margin to be between negative 8% and negative 7.8%, compared to negative 16.1% in 2024. Now I'll pass it to Daniel for some concluding remarks.

Thank you, Clara. I just want to reiterate again how pleased we are with this quarter's performance, and to express my confidence in our ability to maintain strong performance as we continue to transform our massive and hugely important market. Our team remains incredibly passionate about building best-in-class technology for those that the tech industry has long neglected, local governments and some of their most vulnerable citizens. We believe that our financial success is directly correlated to the meaningful impact that our solutions deliver. In the course of our IPO, I had the opportunity to discuss with some of you our views on the importance of making sure that governments are not left behind in the AI revolution. Our customers, not by nature, an early adopter of new technology. And for good reasons, the government agency is responsible for providing public transportation, operating complex and demanding environments, where risk is rarely rewarded. The use of machine learning and AI has always been core to Via. But given the complex environment in which our customers operate, we believe it is our responsibility to help them gain access to this new technology. As we continue to broaden our platform, AI will enable our customers to generate a virtuous cycle of planning, operating, and optimizing their entire networks, leading to smarter and more efficient transit. As the category leader, we believe we are very well positioned to capitalize on the AI and autonomous vehicle opportunities in our space. We're excited to continue to work hard to help our government customers adopt new technologies and meaningfully increase the value they deliver to their constituents. And with that, I want to thank you all again and turn it back to the operator so we can take some questions.

[Operator Instructions] Our first question comes from the line of Adam Hotchkiss with Goldman Sachs.

Great. It's great to speak with you all in a public forum. Daniel, you mentioned the 63,000 customer opportunity. How would you characterize both the catalysts, but also maybe the barriers you've experienced as you think about the next steps in converting more of that opportunity? And then Clara, just briefly, how do you balance growth and investment within that context?

Adam, thanks so much. Great to speak with you here. I think when we focus on the opportunity ahead of us, the barriers are similar to what we've experienced historically. Primarily the customer that we're dealing with has an aversion to risk fundamentally and reluctance to change, and that is usually the highest barrier for us to overcome. I will say that over the years and certainly in this last quarter, we have seen that barrier start to come down, and we're able to accelerate our ability to convince our customers to adopt new technologies And certainly, when we look at regions in which we have established any presence, and even more so when we've established a meaningful presence, that barrier can come down meaningfully and really help us accelerate through these regional network effects that we talk about. So fundamentally, the same. We need to keep doing a really good job explaining the value of the ROI to our customer, and showing them how it works in nearby cities, that's always very helpful. And that, I think, will help us continue to accelerate the progress.

Yes, Adam, great to reconnect, and thanks for the question. When it comes to the investments, we are very focused on putting the dollars where the growth is, and we have a very detailed framework of investment behind the new products that we're launching, focused on our core geography of North America and Europe, and some of the products that we went through together, including our -- obviously our microtransit product, our paratransit product, but also some fixed-route products, but also some new products notably around the school business and some other interesting opportunities that we've identified. So definitely putting the dollars behind the customer opportunity.

Great. That's really helpful. And then just on the quarter itself, how would you frame the makeup of the 24 net new customer addition sequentially you had? It was the largest number, I think we've had in recent company history. So was there anything notable about these customers, either from a product or geography perspective? Did student play more of a role? Or is it just where RFPs happen to fall in the calendar year? Any more detail on that makeup would be helpful.

Yes, happy to break it down further for you. As you saw, we're very pleased with the performance in North America, continuing to see very strong demand there, and that is reflected in the customer growth. And we're also seeing some good traction around new products, including the schools product, which has driven some of that growth as well. So I would say both of these are definitely drivers of the customer growth.

The next question comes from the line of Josh Baer with Morgan Stanley.

Great. Daniel, Clara, Gabby, the whole team, congrats on a strong quarter and welcome to the public markets. I know you have great visibility on the pipeline. I was hoping you could share some of what you're seeing with us from an RFP perspective, or customer decision and implementation timing perspective. Ultimately, what do we need to look out for from the customer adds over the next several quarters? And then my follow-up, Clara mentioned the IPO as a branding moment more from an M&A perspective. I think I'm wondering if you've noticed a change in inbound conversations from customers as well? Has the IPO changed awareness and interest in the platform?

Josh, thanks so much. We're happy to be a public company. It's exciting. Looking at the customers and looking forward, I think we'll continue to see very positive trends across all of our markets. We are seeing -- and I think it ties to your follow-up question, too. We are feeling that the IPO was a moment for us. It's hard to quantify, but the reception on the customer side, definitely feeling sort of a different timber to it, if you will. And I think that's helping us also develop the pipeline and continue to push in that direction. As Clara mentioned, the U.S. in particular, we've seen really strong dynamics, and that's been true for the quarterly results and looking ahead at pipeline, so we're very pleased with that. And we're seeing some good dynamics in Europe, too, as well, especially in the U.K. So looking ahead, I think that's a market we're very interested in focusing on.

Our next question comes from the line of Michael Turrin with Wells Fargo.

My congrats as well on the first quarter as a public company for Via. I want to go back to the customer metric. I think given you had some commentary, we've been fielding questions around central government shutdown impacts. It doesn't sound like there was any real impact there. But I'm just curious how much of the bigger sequential adds you're seeing is tied back to some of the commentary Daniel is making around, just increasing referenceability, and just your view on us assessing that as a good leading indicator for the durability of future revenue growth, or maybe other indicators you would point investors towards as they're getting to know the company.

Michael, thanks for the question. I think -- I do think the referenceability is key. And I know we've been talking about that quite a lot. But the way that we are approaching this market, those proof points that we can point to for customers, whether it's in new conversations and also when we're talking to existing customers about expanding, the fact that they can see what's happening nearby is extremely important. And I think we talked a lot about the Mobile example a bit earlier. I think the fact that in Mobile, they were able to see what we did in Sioux Falls just as an example, and we're able to visit. That is incredibly impactful when they're making -- what is, frankly, a huge decision from their perspective to pass on to us basically management and the design of their entire transit system. I think the influence that these types of conversations that they can have with peers, incredibly important. So that referenceability is really key. And our hope is that we can continue to build on that over the coming years to really drive rapid adoption.

And just on the Waymo partnership and autonomous in general, I think that sounds exciting and maybe a bit more advanced than we tend to think about within public transit agencies. Can you just expand on how you're thinking about the evolution of that opportunity and what that does for Via's TAM overall over time?

Yes. Thanks. I think autonomous is a huge opportunity for us. I also think it's incumbent us to play this role on behalf of our customers and help them adopt this new technology. So we're working very hard to build. Obviously, the partnership with Waymo is exciting. Chandler, Arizona is a first step, but I think with Waymo expanding around the country and now into Europe, lots of opportunity there to continue to expand that partnership. And we're looking to broaden our partnership base so that we can be that partner to our customers who enables them to adopt autonomous vehicles. We're seeing interestingly quite different dynamics in the U.S. versus Europe. U.S. is very focused on robotaxis and we can bring the public sector in. Europe, we're seeing much more of a top-down sort of drive from the government to push autonomous vehicles in the public transit sector. So that may actually be an early adopter of autonomous vehicles and lots of funding going into that. So I think a lot of opportunity in Europe from the autonomous vehicle space. And overall, what we've seen is when we help our customers reduce their cost they're willing to invest more and they see the ROI. So if autonomous vehicles can bring down costs, certainly improve safety, there's just a lot of opportunity there from our perspective.

Your next question comes from the line of Brad Zelnick with Deutsche Bank.

I'll echo my congrats to you all as well, exciting to finally be out and a great quarter to start. Mike -- I've got two questions and ironically, they piggyback on Michael's last question. So first, on customer count, just given the very strong customer additions this quarter, how should we think about the cadence of customer count going forward? And please remind us of any seasonality here or anything else that we should keep in mind? And then I've got a follow-up.

Brad, thanks for the kind words. So we're very pleased with the results this quarter out of the gate. So thank you for the support. On the customer account, you've seen the chart, and we've discussed this quite a lot. There is some cadence to the market. We have certain quarters that are very strong on customer additions and some quarters that are strong but may be lower. The general range for customer additions is 8% to 12%. And when you look back at the last 10 quarters, that's been fairly consistent. So I would expect that we continue to remain in that range. This quarter was very strong. Some of our new products could be seasonal, but we are very early in the penetration of those markets. So there's still a lot of white space overall across the platform, and I feel very good about that range.

Okay. That's very helpful. And actually, I'm going to pivot. I was going to ask a Waymo question, but I'll save that for another time. But maybe a bigger picture for you, Daniel, not that you don't already have an enormous opportunity to pursue. But when you talk about leveraging billions of proprietary data points to bring AI to government and delivering LLM for cities, what's the even broader potential over time, perhaps even in addressing needs that are adjacent to transit?

Yes. Thanks very much, Brad. I think that's a great question. We are very focused on our current market, which, as you mentioned, you talked about a lot, is huge, and we're not seeing that kind of opportunity for durable growth diminish anytime soon in our view. I think the -- with AI and the ability to become much more efficient in developing products, which I feel like in the last quarter, we're starting to see an acceleration our product road map. And in part, I attribute that to our ability to develop code more quickly using these tools. You could imagine that given the customer relationships we have and the opportunity ahead of us, we could more quickly expand into other areas in the government technology space. So I don't think that's necessarily an immediate thing that we would work on, but definitely something on our minds as far as the broader opportunity and how quickly we can move into it.

Next question comes from John DiFucci with Guggenheim.

And I'd like to offer my congrats to the team too. These are really impressive results across all metrics. And Clara, thanks for that customer example, going from 40% to 50%. It really helps with that bridge, a real-life example there. But my question -- my first question anyway is more on the growth. And it has been brought up several times here. This is the greatest sequential increase in customer count we've seen, and our model goes back almost 3 years. But if I wanted to look for anything that may raise questions from investors, the ARR per customer actually declined a little bit sequentially for the first time in 8 quarters. Is that simply because you added so many customers that didn't have a full quarter's worth of revenue in there since your ARR calc is just simply revenue times 4? Or is there something else affecting that we should be thinking about, perhaps the new school product and maybe that's a lower ASP? Or how should we be thinking about that?

Absolutely. Thanks, John. It's a great question and happy to give you more color on ARR per customer. First of all, we're very pleased with the customer adds this quarter, very strong demand across the board and the revenue growth as well. But you're right, platform ARR per customer did decline slightly quarter-over-quarter in Q3 versus Q4, some 1%. And that's generally driven by, one, normal seasonality patterns of our existing contracts. In Q3, we tend to have universities, schools, corporate contracts, that have lower volumes during the summer. So that seasonal -- that slight seasonality drives lower ARR per customer in Q3. And then the growth in our schools business, where we saw a significant increase in the number of customers and the schools product is relatively new. These customers launched their services in Q3, coinciding with the start of the academic year and, therefore, contributed to more limited revenue in that quarter. So that drove the slight decline in ARR per customer. Over time, we expect these customers to ramp up.

Okay. Great. And Daniel, you said there was no impact from the federal government shutdown in this quarter. But we've been just looking closely at all the government funding. And do you see any impact from like COVID era funding that I think, in some cases, is going to start expiring over the next year or so? Perhaps maybe you can share your experience in similar situations, when there are funding pressures, where does mass transit sit as far as priorities among competing alternatives for funding?

John, thanks. It's a great question. When -- maybe I'll try to answer that in a few different pieces. So specifically to the government shutdown, we haven't seen any impact at all so far. And we don't expect to see any impact from that. The way that funding for transit works, it's long-term funding typically appropriated at the federal level, appropriated every 5 years. This sort of -- it was a very long shutdown obviously, but we don't believe that it will have any impact on our business even as it ends and looking into this quarter and the next quarter. So that specifically to the shutdown. I think more generally, you're asking a general question of what is happening to -- with transit funding, especially some of those funding bills from previous administration start to expire and longer term. There's sort of, I'd say, some puts and takes there. There's some of this funding that's expiring. There's some other funding that we talked about, whether through ballot measures or other sort of state legislature approvals that is coming in that is growing the overall pot. Overall, I think what's key for us and what we've seen consistently is that we just need to identify, and it's a little bit on a city by city and transit agency by transit agency basis. We need to identify where they are in their budget cycle. At any point that you're going to look to see -- there may be an overall trend. We've talked about it maybe in Germany, there was a period last year or so where the overall trend was downward. There's still some cities that have more budget, some cities have fewer. The U.S., I don't think the overall trend is downward. I think it actually continues to go up overall. And then -- but within that, there's still individual cities or transit agency that may be in their budget cycles sort of up or down. And the key for us is to identify where they are in the budget cycle so we can honestly provide them with the right solution, adapt our pitch, if you will, if you think of it from a sales perspective, but in reality, find the right solution for them. If they're in a downward trend, we need to help them save money, we need to help them become more efficient. And I think we're extremely well positioned, sometimes kind of counterintuitively, that's our biggest opportunity because they have to change something. They're under budget pressure and that's where we can come in with our solution and really help them avoid service cuts while they're reducing their budgets. Obviously, in an expansion kind of phase, that's also a great opportunity. We can launch new microtransit services, we can do lots of stuff with them. So it's really about identifying where they are versus being worried about the budget going up or down. Does that makes sense?

That does make sense, Daniel.

Your next question is from the line of Patrick Walravens with Citizens.

Let me add my congratulations [indiscernible], the perfect debut. Can you guys comment on -- and I know you'll guide next quarter, so we're not asking for that. But can you just comment on what the durability of the growth looks like in this model? And also what the pace of margin expansion looks like? Just sort of any broad points you can share with us would be super helpful.

Pat, thanks for the question. We feel very good about the durability of the growth long term. Just given the scale of the market, our very limited penetration. And the fact that it's not -- we don't see our current cohort of customers as being any different from the next cohort of customers, if you will. I think I talked about Springfield, Ohio and that opportunity. There are so many cities like Springfield. So it's not that there's something unique about our current customer that won't apply to the next 100, 200, 1,000 and 2,000 customers. We really believe that there's a tremendous opportunity to continue doing what we're doing today just at a much larger scale. Now if you add on top of that, all the product innovation that we're driving the new products, other opportunities, we're very optimistic about what's possible here.

That's fantastic. And Clara, maybe pace of margin expansion?

Yes. I'll leave that to Clara.

Thanks for the kind words as well. So in the immediate term, so we're focused on organic operational improvements to enable modest gross margin expansion, and we achieved that successfully this quarter with a 0.4% margin expansion. In the medium to longer term, we are working to improve gross margin to 3 levers. One, transitioning our lower-margin services to third parties; two, continuing to expand our platform with higher-margin products, notably our software offering, which we're investing heavily into; and three, continuing to explore strategic M&A. We've established this playbook with Remix and Citymapper acquisitions, which were both highly successful on all counts. And the industry continues to be highly fragmented. So there's an opportunity to acquire point solutions, which may not make it as a stand-alone companies, but have excellent products and teams and may be very accretive additions to the platform. We reiterated on this call the commitment to the long-term target of 50% and our commitment to margin expansion. And again, we'll take two phases, the first phase where we continue to land customers and with modest gross margin expansion, and then the second phase where we start to see the impact of those three levers, and have more meaningful step function expansion of the margin.

Your next question comes from Scott Berg with Needham & Company.

Really nice quarter here out of the gate. I wanted to probably take Brad's Waymo question here. But I think the partnership is super interesting, but knowing how those contracts are constructed within the Microtransit area, how do your contracts change in that type of scenario? Are these contracts probably -- my guess is they're more weighted on the software side of what that offering looks like than some of the peer services side. But just trying to understand how that may or may not shift in that scenario.

Well, that's a great question, Scott. And that's absolutely right. When we partner -- so we think of Waymo as one of our potential fleet providers. We can have a human-driven vehicle with a fleet, we can have a Waymo vehicle. And those would be equivalent solutions for our customers, and we offer them both. And in that contract, basically outsourcing to Waymo, the fleet and the vehicle means outsourcing a large chunk of our COGS to a third party. So those contracts tend to be higher margin. Obviously, we have a small sample today, so there's some room to explore there, but they have very high margin and allow us to bring this incredible technology to our customers with our vertical software layer on top, so they can actually use it as part of their transit system.

Understood. Helpful. And then many comments on the strong customer additions in the quarter. I guess as you think about the growth algorithm over the near term, maybe 2 to 4 quarters out, does that algorithm kind of shift towards more net new customer opportunity, or more revenues coming from net new customers? Or the really predictable cross-sell model, is that still the way we should think about maybe the next several quarters?

Yes. Great question. From our point of view, the growth algorithm stays pretty much the same. We're very focused on continuing to grow within our existing customers and also add new customers in the same way that we talked about. And if I'm looking forward a few quarters, the feeling is that it should stay about the same as what you've seen in our historical results as far as the distribution between the two.

The next question comes from Brian Schwartz with Oppenheimer.

Echo great results out of the gate. Two questions. First for Daniel on AI. I know it's early, but how do you envision discussing pricing for AI functionality with your clients? Clearly, it's a differentiator of the business. But is it all about stickiness of the platform? Can it help you take up price since you're giving clients more value? Just thinking about as you bring in more AI functionality into the product suite and your core offerings moving forward?

Brian, thanks so much. Great question. I think we can do so much with AI to continue to evolve and transform the product in something that's increasingly even more useful to our customers. So there's definitely a lot of value that we're delivering there. On price specifically, at least for now, we are trying to be extremely customer-centric. Our customer is very sensitive to feeling that they're in any way being nickeled and dimed. And so our approach has been for our entire history to say we deliver a solution, and we will continuously upgrade that solution for you so that you're extremely happy with that product. That makes it very sticky. It builds real trust with our customer. And we have so much other opportunity to grow with them beyond simple price increases to our software, that's been our philosophy. I think that should apply to additional AI features that we're adding into the platform despite the fact that I do agree they can contribute enormous amounts of value to the customer. Now that said, in parallel, we're able to use AI to launch, what I think of as sort of, new products. And those, I think we can sell separately as individual SKUs, increasing the revenue that we're able to generate from each one of our customers. These are also very high margin to Clara's point earlier. So I would separate from taking existing functionality, upgrading it sometimes very significantly with AI, at least in the short to medium term, that really isn't our philosophy to try to charge for that. And I think it's had -- add a lot of value. Some new products, I think, are real opportunities.

Thank you, Daniel. And one question for Clara. Following up on Pat's question, but maybe specifically about the gross margin line. We saw a nice lift to gross margin this quarter and over the past 4 quarters, too, for the business. Beyond scale, are there other drivers for greater gross margin efficiency that you can foresee taking hold for the business over the next 12 months, or maybe over the medium term?

Thanks, Brian. A very thoughtful question. So happy to address it. I think there are several drivers that we're looking at to continue to drive gross margin beyond scale and beyond the three levers that we just discussed. One is obviously the mix shift towards higher-margin contracts we're seeing, and you saw this great case study of a customer that went from 40% to 50% gross margin and is continuously improving. And that customer's growth -- revenue growth will drive further margin expansion. So continuing to look at the mix shift, which is a really nice driver of near-term margin expansion is quite interesting and focusing on those customers where we can drive an uptick in margin through changes in operational metrics. And second, we are continuing to work on cost improvement on our cost to serve our customers. AI has brought a lot of new opportunities to reduce costs in our cost of serve. So while on the top line, Daniel just discussed, we're just adding more value to our platform and bringing and continuing to penetrate our TAM, which will drive a lot of revenue growth going forward and hopefully, durable growth, strong durable growth. On the cost line, we're actually using AI to reduce our costs, and that is valid for, obviously, our COGS and our OpEx, and trying to continue to generate examples, obviously, customer support, customer success infrastructure costs, the ability to better manage and control all those costs has increased substantially with AI tools. So we're definitely focused on that. And I think that will drive margin expansion.

Your next question is from the line of Brian Peterson with Raymond James.

Congrats on the really strong results here. So I wanted to double-click on the schools opportunity. It's encouraging to hear the momentum there. Is there any way to help frame that opportunity relative to what you have today, either in terms of fleet size or spend? And as we think about that go-to-market, is that more of a net new dynamic where you're selling to a new buyer? Or is there a cross-sell potential relative to some of your existing public sector customers. Could you guys unpack that a bit?

Yes. Thanks, Brian. Happy to give more color on that opportunity. I would start by saying that we've been investing in the product and the technology for that end market for a significant amount of time. But the go-to-market motion is still very nascent for schools. So we're in the early stages of capturing this opportunity. And to answer some of your question and that opportunity is quite meaningful and it is part of our overall TAM, and definitely very attractive across all fronts. The way we look at it is the buyer is -- can be different, it depends. We're looking -- in general, we tend to go to school districts, or DOEs or head of schools. And they are definitely different than the mayor, or the head of the transit agency in terms of who is actually buying the platform. So that is definitely a new customer and a different buyer in most cases. However, there is a halo effect and the referenceability of our platform within a city. So there are certain cities where these may be kind of living together in these various functions and these people may be sitting together and discussing their solutions. There are other scenarios where they're quite separate. So I would say, there's a bit of a range of buyers. But I would say in most cases, it's a slightly different buyer, although once we have existing presence in that region or that city would definitely benefit from the network effect and the referenceability of our platform. More to come on that as we continue to grow that business.

No, that's great to hear, Clara. And maybe just sticking on the referenceability point. Daniel, I know you mentioned the European Customer Advisory Board. You're very strong in Germany. The tone on the U.K. is not lost on us. But I'm just curious, as you think about those proof points in those markets, how do we think about a potential groundswell into other geographies? Congrats on the strong results.

Thank you so much, Brian. I think specifically within Europe, maybe I'll just give an example on the school bus. That's a market where school bus operates quite differently. They don't have yellow school bus as well. In the U.S., yellow school bus, there are more buses, if you just count the number of buses than there are transit buses. So it's a huge opportunity. In Europe, typically, school bus is much more integrated. They don't have yellow school bus, much more integrated into their sort of traditional public transit system. With a lot of special education, school transport being provided. So there, there's an opportunity and that gets the referenceability to sell the school bus product to the same customer, to the customer that we already work with. So that's a much more direct sale. There's a lot of product work that's still complete there to make that opportunity to accelerate, but I think that's an area that we can see some really good growth. And overall, I do think that while, yes, every place you go, they say, "Oh no, no, here, we're different than we are in this other country." There's no question that when we have success in one region, it influences all the other regions as well.

Your next question is from Jonathan Ho with William Blair.

Let me echo my congratulations as well. Maybe just starting out with the strength you saw in the U.S. market this quarter, what maybe stood out, or maybe surprised you in terms of win rates or utilization? Just want to understand the drivers for that geographic strength.

Thanks, Jonathan, and good to connect. From our perspective, Q3 was business as usual. We saw very strong demand for the platform across all metrics and across all of our solutions. You can see historically, there's a cadence to the market, certain quarters that can be very strong, certain quarters are a bit slower. And this quarter turned out to be very strong with lots of additions and growth. But the growth algorithm is the same and the opportunity continues to be very large, supporting durable growth, and we'll continue to be very excited and confident in this opportunity. And I think Q3 is no different than the prior quarters and really a strong testament of that market opportunity.

Got it. And then in terms of the timing for ballot measures that you referenced. Like what is the time frame for that to translate into contracting and potentially RFP opportunities? It would just be helpful to understand what that process typically looks like.

Yes. Thank you, Jonathan. Great to connect. Great question. That's worth clarifying. That is a very long-term process. So it takes months, sometimes years for that funding to sort of really become available, then there's the procurement process and so forth. So we're looking at -- and then the funding is often over many years that it's available depending on the specific ballot measure. So we're looking at a very long-term impact. Generally, in our business, everything we're doing is fairly long term and we're always thinking ahead. And in many cases, we're increasingly finding ourselves involved in these ballot measures and helping to support them and maybe even initiate them in some cases. So I think that's something that we'll look to do more of and really thinking 1, 2, 5, 10 years ahead in some cases as to when it will have a material impact on the business. But that's just -- that's sort of the time scale that we need to think of...

And your final question comes from Aleksandr Zukin with Wolfe Research.

Congrats. Maybe, Daniel, first one for you. The Waymo partnership feels like a seminal moment, partially because it seems like it enables you to kind of even more, maybe aggressively fulfill your vision for solving what seems to be an extraordinarily difficult kind of algorithmic and services challenge for your customer base? And maybe just elaborate, if you can, both the potential marketing and pipeline opportunity that, that partnership is driving from awareness in terms of your customer base? And then from both an accretion perspective to the contract, which I think you guys mentioned earlier, how do we think about as more of potentially these autonomous contracts roll out across your customer base, how do we think about the revenue uplift opportunity? And I've got a quick follow-up.

Thanks, Alex. I really appreciate it. I agree with you. I think there's a real opportunity in autonomous. It's just starting, but I agree with everything you said. I think there's a -- there can be a real impact, both in the way that our customers perceive this opportunity. I would say -- what I've seen from talking to customers, and that's true here and in Europe, as these autonomous vehicles become available, the demand for them from the public transit sector is very high. I think it's really just limited by the availability of these vehicles. And there are even some of our customers that have indicated that -- and sometimes it's not even yet a budget matter. It's just a matter of wanting to be ahead on this technology that they would be willing to launch certain services of autonomous vehicles that they're not -- it may take them a lot longer to agree to launch with human-driven vehicles. So I feel that the opportunity is very large, I totally agree with you, and it really is at the moment, depending on the availability of these autonomous vehicles. So as quickly they can become available in the different geographies, I think we'll see an acceleration.

Perfect. And then maybe, Clara, the large upsell that you guys talked about for Mobile, Alabama, it feels like that was also a competitive displacement of a larger -- or a large competitor. Maybe just talk through as you continue to take share, when does that kind of click happen in the mind of a customer to really move and scale from a legacy operator to Via in those situations?

Alex, thanks for the question. And you're absolutely right. This was a takeover. I mean that some of the expansion was a takeover from a legacy player in the transit space. It's a really interesting market that we're in, where it's probably the last pen and paper industry in terms of technology and you have a number of very large legacy players that are all, obviously, very large in scale that have been established in this market for a very long time. And so it is a process to displace them, and displace them with these very large contracts. I would say demand for these very large contracts is the strongest it's ever been. So we're starting to see a halo effect of some of the takeovers. We've taken over several of those contracts already, and the performance is extremely impressive in terms of both taking transit systems that actually do not work that our ridership are declining -- ridership is declining, cost is increasing, consumers, residents are not aware of it and not happy with it and turning that around within a year or 2. So we're starting to see outstanding results for those very large takeovers. And as we see more -- as we get more data around that, we are seeing the referenceability kick in and the flywheel effect work. And so today, we have probably the strongest pipeline in this type of opportunities we've ever had. And obviously, it's on us to execute on that, and there's a sales cycle, so it will take some time, but we're very confident in our ability to continue to push on that front and get very large contracts for the business over time.

This concludes the Q&A session for today. I will now hand the call back to Via for closing remarks.

Thanks very much. So thank you all for listening and for the great questions. As we said, we're very pleased with our first quarter results as a public company, and we're excited for the road ahead. Look forward to doing many more of these calls with you. Thanks, everybody.

Thank you again for joining us today. This does conclude today's presentation. You may now disconnect.