Red Violet, Inc. Reports 25% Revenue Growth to $75.2 Million for Fiscal Year 2024

Red Violet, Inc. reported a 25% increase in total revenue for the fiscal year ending December 31, 2024, reaching $75.2 million, compared to $60.2 million in 2023. The company attributed this growth to a combination of new customer acquisitions, which contributed $1.0 million, and a $11.6 million increase in revenue from existing customers. The number of billable customers for the IDI brand rose to 8,926 from 7,875, while the FOREWARN user base expanded significantly from 185,380 to 303,418. Despite the revenue growth, net income decreased to $7.0 million from $13.5 million in the previous year, primarily due to a one-time deferred income tax benefit of $10.3 million recognized in 2023.

In terms of operational efficiency, Red Violet's gross profit increased by 33% to $51.8 million, with gross margins improving to 69% from 65%. Adjusted EBITDA also saw a notable rise, increasing 44% to $23.6 million, reflecting a margin of 31%, up from 27% in the prior year. The company’s cost of revenue as a percentage of total revenue decreased to 19%, down from 22%, indicating improved operational efficiency. However, sales and marketing expenses rose by 29% to $17.8 million, driven by increased personnel-related costs and marketing efforts.

Strategically, Red Violet continues to enhance its product offerings and market presence. The company markets its solutions primarily through its IDI and FOREWARN brands, focusing on identity intelligence and risk mitigation solutions. The company’s go-to-market strategy includes a combination of inside sales, strategic sales for major accounts, and partnerships with distributors and resellers. This approach aims to expand its footprint in various industries, leveraging a "land and expand" model to increase customer reliance on its solutions.

Looking ahead, Red Violet anticipates continued growth driven by the increasing demand for data analytics and identity verification solutions across various sectors. The company is focused on maintaining its competitive edge through technological innovation and expanding its customer base. As of December 31, 2024, Red Violet had cash and cash equivalents of $36.5 million, which, along with projected revenue growth, is expected to support its operational and capital needs in the coming year. However, the company acknowledges potential challenges, including macroeconomic conditions and regulatory changes that could impact its business operations and financial performance.