10-Q · May 6, 2026
Red Violet, Inc. reported a strong Q1 2026 with a 17% increase in revenue to $25.8 million and an EPS of $0.46, exceeding estimates. Despite a slight decline in revenue from new customers, the company's solid growth in…
Earnings analysis · 10-Q
RDVT earnings analysis
Filed August 10, 2026 · Our reading of the company's report
The latest report
Red Violet delivered a strong second quarter, with revenue up 23% year over year to $26.718 million, diluted EPS of $0.34 versus $0.18, and free cash flow of $7.172 million versus $4.770 million. Gross margin expanded…
Read full summary
Red Violet delivered a strong second quarter, with revenue up 23% year over year to $26.718 million, diluted EPS of $0.34 versus $0.18, and free cash flow of $7.172 million versus $4.770 million. Gross margin expanded to 76% and operating margin was approximately 22.8%, while customer counts grew substantially across both IDI and FOREWARN. The principal offsets are a 24% effective tax rate, $35.5 million of contractual commitments, supplier concentration, and potential dilution following the $108.6 million net equity offering; no formal risk-factor changes were reported.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $0.34
What stood out
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Revenue growth accelerated
Revenue increased 23% year over year to $26.718 million from $21.774 million and was approximately 3% above the prior-quarter $26 million reported in the quarterly history. Management attributed growth to new-customer onboarding and volume expansion from existing customers.
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Gross profitability improved year over year
GAAP gross margin was 76%, up from 72% year over year, while gross profit increased 29% to $20.184 million. Adjusted gross margin was 86%, compared with 84% in the prior-year quarter.
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Strong EPS and net-income growth
Diluted EPS increased to $0.34 from $0.18 year over year and exceeded the $0.31 consensus estimate. Net income increased 85% to $4.960 million from $2.686 million, although the effective tax rate rose to 24% from 13%.
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Operating leverage strengthened
Operating margin was approximately 22.8%, based on approximately $6.1 million of operating income implied by $6.5 million of pre-tax income less $0.4 million of interest income. This compares with 21.1% in the prior quarter and 12.6% in the prior-year quarter from the provided history.
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Cash generation remained robust
Operating cash flow increased 42% year over year to $10.637 million from $7.487 million. Free cash flow was $7.172 million, up from $4.770 million, after $3.465 million of property and equipment purchases and capitalized intangible-asset costs.
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Customer base expanded materially
IDI billable customers rose to 10,869 from 9,549 year over year, while FOREWARN users increased to 443,173 from 346,671. The company added 447 IDI customers and 25,493 FOREWARN users during the quarter.
What to watch
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Significant contractual commitments
The company reported material commitments of $35.5 million under data-licensing and cloud-service agreements as of June 30, 2026. Although management expects to fund them with cash and operating cash flow, these commitments reduce flexibility if growth or cash generation weakens.
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Data-supplier concentration
The largest data supplier represented 46% of total data-acquisition costs in the quarter and 46% for the first six months, creating supplier-concentration exposure. The supplier agreement runs through April 30, 2031.
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Equity issuance and dilution risk
The August 2026 public offering generated approximately $108.6 million of net proceeds after the issuance of 1,916,667 shares, including 250,000 shares under the underwriters’ option. Future equity financing may dilute existing stockholders, and management specifically noted that additional capital could be raised through equity or debt securities.
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Macro and tax-rate headwinds
Higher interest rates may reduce demand for credit and usage of the company’s services among banking and financial-services customers. The company also reported that its effective tax rate increased to 24% from 13% year over year, creating a profitability headwind.
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No formal risk-factor update
There were no material changes to the risk factors previously disclosed in the 2025 Form 10-K. However, the company repurchased $3.1 million of common stock during the first six months while also using $3.8 million in financing cash flow, which may compete with acquisition or investment priorities.
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New-customer revenue was weaker YTD
Revenue from new customers declined 7% to $4.1 million for the first six months of 2026, despite second-quarter new-customer revenue increasing 36% to $2.0 million. This indicates that the year-to-date growth mix remained more dependent on existing-customer expansion.
Management's outlook
No numeric revenue or EPS guidance was provided in the 10-Q. Management stated that existing resources should fund operations and expected capital expenditures for at least the next twelve months.
Earlier filings 4
10-K · March 4, 2026
Red Violet, Inc. reported a strong financial performance for 2025, with a 20% increase in revenue to $90.3 million and a significant rise in net income of 88% to $13.15 million. The company maintains a robust…
10-Q · November 5, 2025
Red Violet, Inc. reported a strong performance in Q3 2025, with revenue rising 21% year-over-year to $23.1 million and earnings per share (EPS) significantly exceeding expectations at $0.29, a 141% increase from the…
10-Q · August 6, 2025
Red Violet, Inc. demonstrated strong performance in Q2 2025, with revenue growth of 14% year-over-year to $21.8 million, driven by existing customer expansion. The company reported an EPS of $0.28, surpassing the…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.