CLEAR (YOU) Q2 2025: International Access Adds 38% Member Growth, Expanding TAM Ahead of World Cup
CLEAR’s Q2 unlocked international traveler access, fueling a 38% surge in total members and setting the stage for continued expansion into new markets and verticals. Product innovation, a disciplined pricing strategy, and operating leverage drove margin expansion despite a flat travel environment. With Real ID and healthcare integrations coming online, CLEAR is positioning itself as the secure identity platform across travel, workforce, and consumer applications.
Summary
- International Traveler Access Launch: New passport-based enrollment for UK, Canada, Australia, and New Zealand expands TAM and member base.
- Operating Leverage and Product Expansion: Margin gains driven by automation, new services, and disciplined pricing.
- Platform Diversification Momentum: Healthcare, workforce, and digital identity integrations broaden enterprise relevance beyond airports.
Performance Analysis
CLEAR delivered double-digit revenue and bookings growth in Q2, outpacing a broadly flat travel environment. Total revenue rose 17.5% year-over-year, with bookings up 13.1%, supported by record travel volumes and the launch of new product offerings. Active CLEAR Plus members grew 7.5% to 7.6 million, while total platform members surged 38.2% to 33.5 million, reflecting both core travel adoption and expansion into adjacent use cases. Gross dollar retention edged up sequentially, aided by a coordinated price increase and stable member renewal behavior.
Margin expansion was a defining feature, with operating margin increasing over 300 basis points and adjusted EBITDA margin up 200 basis points, driven by continued automation (notably the NV verification pods, which verify five times faster than legacy hardware) and disciplined G&A management. Direct salaries and benefits as a percentage of revenue improved after adjusting for compensation model changes. Free cash flow generation remained robust, with $117.9 million delivered in the quarter, though growth was moderated by higher cash taxes following NOL exhaustion.
- Travel Outperformance in Flat Market: CLEAR lanes processed record volumes even as overall airport traffic declined 0.5%.
- Coordinated Pricing and Upsell: Standard and family membership prices rose, and new premium services like Concierge increased revenue per member.
- Enterprise Platform Growth: CLEAR One signed 25+ new deals across workforce, healthcare, and consumer, marking a record quarter for contract value.
Capital returns were steady, with $42.7 million returned via buybacks and dividends. The company ended Q2 with $609 million in cash and marketable securities, reinforcing balance sheet strength as it invests in new products and market expansion.
Executive Commentary
"2025 continues to be a year of innovation, execution, and momentum, as the need for trust, security, and frictionless experiences in today's world is paramount... Our innovation and progress in realizing our home-to-gate vision has been in service of improving our member experience, growing our total addressable market, and yielding greater operating leverage in our business."
Karen Seidman-Becker, Co-founder, Chair and CEO
"We delivered a strong second quarter of financial results... Our focus on product innovation and experience continues to attract new members to the Clear Plus service... The risk and security environment is driving meaningful interest towards Clear One. We ended Q2 with 33.5 million total members up 38.2% year-over-year, and demonstrative of the growth we are seeing on the Clear platform."
Jen Hsu, Chief Financial Officer
Strategic Positioning
1. International Expansion and TAM Growth
The launch of CLEAR Plus access for travelers from the UK, Canada, Australia, and New Zealand opens a new addressable market without incremental regulatory hurdles, thanks to a passport-based digital enrollment process. This move not only supports member growth but also positions CLEAR as a global travel security platform ahead of major events like the World Cup. Pricing parity with US offerings and strong partner channels (airlines, hotels, Uber) should accelerate adoption.
2. Platform Diversification: Healthcare and Workforce
CLEAR One is gaining traction as a trusted enterprise identity solution, signing a record number of deals in Q2 across healthcare, workforce, and consumer verticals. Integrations with Epic (electronic health records, 325 million patients), DocuSign (critical agreements), and the CMS Health Tech Ecosystem Initiative signal deeper penetration into regulated industries. These moves leverage CLEAR’s security and trust brand to solve fraud and credentialing pain points beyond travel.
3. Product Innovation and Member Experience
Rapid rollout of new products—such as face-first NV verification pods, digital Real ID, and premium Concierge services— is elevating the member experience and increasing revenue per user. Digital enrollment and e-passport scanning reduce friction, while Concierge offers high-margin, differentiated service for premium travelers. These innovations also drive cost leverage by automating throughput and reducing manual labor needs.
4. Pricing Discipline and Revenue Optimization
Management is shifting to a more consistent, methodical pricing strategy, moving away from sporadic increases to regular, value-aligned adjustments. Upselling through bundles (e.g., TSA PreCheck with CLEAR Plus) and premium add-ons (Concierge) is expected to lift bookings and average revenue per member, with early data showing stable retention post-price increases.
5. Operating Leverage and Cost Structure
Automation and streamlined compensation models are driving sustained margin expansion, even as the company invests in product and platform growth. G&A discipline and the completion of major CapEx for pod upgrades further support free cash flow generation and capital returns.
Key Considerations
CLEAR’s Q2 demonstrates the power of network effects and platform extensibility in the identity space, with execution in both core travel and emerging enterprise verticals. Strategic focus on member experience, automation, and disciplined pricing sets the foundation for continued margin expansion and market share gains.
Key Considerations:
- International Onboarding Simplicity: One-step passport enrollment for international travelers removes friction and widens the funnel for new members.
- Healthcare and Workforce Penetration: Record CLEAR One deals and integrations with Epic and DocuSign signal early momentum in non-travel verticals.
- Margin Expansion Through Automation: NV pods and digital onboarding reduce manual labor, expand throughput, and lower unit costs.
- Pricing and Upsell Strategy: Disciplined, regular price increases and premium service bundles are supporting higher revenue per member without material churn.
- AI as a Strategic Lever: Management is embedding AI across workstreams to drive productivity, personalization, and fraud prevention, supporting both top and bottom line.
Risks
Macro travel demand remains a wild card, and while CLEAR outperformed in a flat environment, any sustained downturn could limit member growth. Enterprise adoption in healthcare and workforce is nascent, and scaling beyond pilot integrations may face regulatory, integration, or competitive hurdles. Dependence on airport and TSA partnerships means policy changes or operational disruptions could impact throughput or pricing power. As AI and digital identity adoption accelerate, competitive intensity and evolving privacy standards could introduce new compliance and reputational risks.
Forward Outlook
For Q3, CLEAR guided to:
- Revenue of $223 to $226 million
- Total bookings of $253 to $258 million
For full-year 2025, management reaffirmed guidance:
- Adjusted EBITDA margin expansion year-over-year
- Free cash flow of at least $310 million
Management noted that Q3 will be the smallest net member adds quarter due to annual billing and seasonality, but expects continued margin progress and cash generation. New product launches and international expansion remain key drivers for the back half.
- Focus on disciplined pricing, upsell, and automation to sustain margin gains
- Ongoing expansion of CLEAR One into new enterprise verticals
Takeaways
CLEAR’s platform strategy is delivering both growth and margin expansion, with international access and enterprise use cases broadening its relevance. The company’s ability to innovate and automate while maintaining pricing power supports its long-term thesis as a scalable identity infrastructure provider.
- Platform Expansion Beyond Travel: Early traction in healthcare and workforce is critical for future growth and valuation, with Epic and DocuSign integrations as proof points.
- Margin Leverage Through Automation: NV pods and digital onboarding are driving cost efficiencies that support both reinvestment and capital returns.
- International and Premium Upsell Momentum: New international access and premium Concierge services are expanding TAM and revenue per member ahead of major travel events.
Conclusion
CLEAR’s Q2 results validate its transition from a travel-only service to a broader secure identity platform, with strong execution in member growth, margin expansion, and product innovation. The company is well-positioned to capitalize on global travel recovery and the rising importance of digital identity across industries.
Industry Read-Through
CLEAR’s robust member growth and successful international rollout signal that trusted, frictionless identity verification is becoming a core infrastructure layer for travel and adjacent industries. The company’s integration into healthcare (Epic), workforce (Greenhouse), and digital agreements (DocuSign) highlights the growing enterprise demand for secure, user-friendly identity solutions. Competitors in biometrics, digital onboarding, and enterprise authentication should note the importance of physical-digital network effects and regulatory partnerships. As airports and enterprises seek to modernize, expect further convergence of security, convenience, and digital identity platforms across the sector.