Company: RSKD
Filing Date: 2025-03-06
Form Type: 20-F
Source: 0001851112-25-000006
Chunk: 102

Company: RISKIFIED LTD.
Filing Date: 2025-03-06
Form: 20-F
Item: Item 5
Chunk 102
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123.1 billion to $141.2 billion. Approximately $44.7 million of the increase in revenue was driven by new merchants onboarded to our platform in 2023 and 2024 primarily within our tickets and

travel, food, and money transfer and payments verticals which grew by 17%, 40%, and 66%, respectively. This was offset by a net decrease of $12.3 million in revenue from existing merchants due to higher attrition primarily within our general retail and home verticals and continued organic declines, net of upsells, which contributed to our Net Dollar Retention Rate of 96%. The increase in revenue was also offset by $2.5 million relating to the recognition of the remaining unrecognized grant date fair value associated with warrants issued to a former customer whose SaaS agreement was terminated during the period.

Revenue attributable to issued indemnification guarantees that are accounted for under ASC 460 and included within the $29.9 million increase in revenue, increased by $8.9 million for the same reasons noted above. Revenue attributable to issued indemnification guarantees as a percentage of total revenue decreased slightly from 44% during 2023 to 43% during 2024 primarily due to improvements in our CTB ratio.

Cost of Revenue and Gross Profit Margin

                           Year Ended December 31,                                                                              
                           2024                                      2023                   $ Change                  % Change  
 ────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────────
                           (dollars in thousands)                                                                               
  Cost of revenue          $                            156,577      $         145,091      $             11,486      8         
  Gross profit margin      52                                        51                                                         

The increase in cost of revenue of $11.5 million, or 8%, was primarily attributable to an increase of $9.9 million in net chargeback expenses that was driven primarily by continuing increases in GMV associated with merchants in our tickets & travel verticals and the onboarding of new merchants. There was also an increase of $1.6 million in hosting, software, and data enrichment costs.

Gross profit margin increased to 52% from 51% due to a decrease in our CTB Ratio. Our CTB ratio, which is a key driver of our gross profit margin, decreased to 40% from 41% and was primarily driven by improvements in our model performance, strategic risk management, and a 2023 isolated fraud event that did