Trustpilot beats first-half expectations, launches new share buyback

Trustpilot Group reported a strong first-half performance on Wednesday, surpassing market expectations in a number of areas.

The FTSE 250 company said profitability notably improved, driven by strategic advancements and product innovations, which helped boost bookings by 19% in constant currency, reaching $118m.

Additionally, the platform’s net dollar retention rate rose to 101%, up from 99% in the same period last year.

Trustpilot's user base grew significantly, with 67 million unique monthly users, marking a 28% increase.

The platform now hosted over 300 million reviews.

Revenue for the group rose 18% to $100m, while annual recurring revenue saw a 17% increase, reaching $211m.

The company also reported a jump in adjusted EBITDA, which climbed to $11m, compared to $6m in the first half of 2023.

That improvement was put down to increased operating leverage, leading to a 3.9 percentage point rise in adjusted EBITDA margin.

Trustpilot said it continued to generate strong operating cash flow, ending the period with $76m in cash, despite completing a £20m share buyback.

Given its solid cash position and confidence in future performance, the company announced a new share buyback programme of up to £20m.

Looking ahead, Trustpilot maintained its outlook for mid-teens revenue growth in constant currency for the full year, and said it now expected adjusted EBITDA to reach the upper range of market forecasts.

“We executed well against the strategy in the first half,” said chief executive officer Adrian Blair.

“Consumer adoption of the platform continues to grow, with unique monthly users up 28% over the same period last year.

“For businesses, we released a series of new product features to our software platform in April which provide unique insights into consumer behaviour and market dynamics, and we are pleased with the early feedback we have received.”

Blair said that as a result, the firm delivered strong bookings growth and adjusted EBITDA ahead of expectations in the first half, alongside a significant improvement in its net dollar retention rate.

“There is still plenty to do and we are excited by the significant growth opportunities available to us in our focus markets and beyond.

“We remain confident in delivering sustainable growth and improving operating leverage over the long term.”

At 0853 BST, shares in Trustpilot Group were up 8.81% at 210p.

Reporting by Josh White for Sharecast.com.