Company: RSKD
Filing Date: 2025-03-06
Form Type: 20-F
Source: 0001851112-25-000006
Chunk: 94

Company: RISKIFIED LTD.
Filing Date: 2025-03-06
Form: 20-F
Item: Item 5
Chunk 94
---
 riskier order populations. Finally, our chargeback expenses typically become less volatile over time as we scale. As of December 31, 2024, our portfolio of potential chargeback liabilities was diversified across a wide variety of industries, hundreds of merchants and millions of individual transactions.

Using our proprietary AI-powered ecommerce risk intelligence platform, data assets, and scaled merchant network, we are able to control the chargeback expenses we incur, as evidenced by our ability to maintain our annual CTB Ratio between 37% and 41% for the past four years. We use the annual CTB Ratio to evaluate the performance of our business operations and the effectiveness of our models. We believe that CTB Ratio is best analyzed on an annualized basis, rather than quarterly, as individual quarters may fluctuate due to a number of factors, including changes in the mix of our merchant industry and geographic base, the risk profile of orders approved in the period, and technological improvements in the performance of our models.

Factors Affecting Our Performance

We believe that our future performance is broadly correlated with global ecommerce trends and will depend on many factors, including the following:

•Chargeback liability shift rules and regulations and adoption of alternative payment methods: Our revenues are primarily derived from ecommerce merchants that bear the liability for fraud-related chargebacks. The adoption, implementation or evolution of laws and regulations, including card scheme rules has or may in the future result in the shift of liability for certain categories of transactions away from merchants and on to other participants in the payments chain. Further, alternative ecommerce payment methods (“ APM”) such as “buy now pay later”, cryptocurrencies or “digital wallet” style products such as Apple Pay, Google Pay, and PayPal may be less susceptible to fraud than traditional payment methods. These APMs may include native fraud management features, sit outside of the broader chargebacks regime or allow liability for online transactions to be shifted away from merchants. The evolution of chargeback liability shift laws and regulations, including card scheme rules, and the emergence of APMs may alter our customer base or the demand for our products, or the GMV available for us to review.

•Technology leadership and product development: We intend to continue to invest in enhancing our AI-powered ecommerce risk intelligence platform by developing new products, features, and functionality to maintain our technology leadership. Our ability to innovate is a byproduct of our exceptionally deep technology integrations across a variety of merchant systems. The depth of our integrations allows us to collect and analyze complex transaction data and behavior patterns across our merchant