Ibotta (IBTA) Q3 2025: Third-Party Redeemers Up 19% as LiveLift Pilots Accelerate Platform Shift

November 12, 2025 | By EarningsIQ Research

Ibotta’s third-party redeemer base surged 19% YoY, even as revenue contracted, spotlighting the company’s evolving network model and early traction for its LiveLift measurement solution. Despite macro headwinds and a tough CPG landscape, Ibotta’s rapid pilot expansion for LiveLift and new third-party measurement partnerships position the business for a more outcomes-driven future. Management’s focus now shifts to scaling automation, client onboarding, and sales execution to unlock the next phase of growth in 2026.

Summary

• Redeemer Base Expansion: Third-party redeemer growth outpaced revenue, underscoring network leverage over direct-to-consumer channels.
• Measurement Innovation: LiveLift pilots and Circana partnership are reshaping client adoption and validation dynamics.
• Transformation Trajectory: Execution focus now pivots to automation, streamlined client experience, and sales continuity for 2026.

Performance Analysis

Ibotta’s Q3 2025 results reflect a business in the midst of strategic transformation, with revenue of $83.3 million declining 16% year over year, but landing in the upper half of guidance. The revenue contraction was driven by tough comps, macro CPG softness, and a deliberate shift in redemption activity from direct-to-consumer (D2C) to third-party publisher channels. Third-party publisher redemption revenue fell just 4% YoY, while D2C revenue dropped 31%, highlighting the company’s pivot toward a partner-driven model.

Redeemer growth was the standout metric, up 19% YoY to 18.2 million, propelled by expanded partnerships with Instacart and DoorDash. However, redemptions per redeemer fell 28%, reflecting the lower activity frequency of third-party users compared to D2C. Gross margin compressed by nearly 800 basis points YoY (to 80%), pressured by higher publisher costs, but improved sequentially. Operating expenses were flat to down YoY, with investments in sales and technology transformation up 11% when including capitalized costs.

• Network Shift: Third-party publisher channels now dominate, reducing D2C reliance and enabling broader reach.
• Offer Quality and Frequency: Lower redemptions per user signal both offer mix changes and the challenge of sustaining engagement via partners.
• Cost Discipline Amid Investment: Operating expenses held flat, but targeted increases in sales and R&D reflect the company’s transformation agenda.

Share repurchases totaled $38.7 million in Q3, with $89.9 million remaining authorized, signaling confidence in long-term value despite near-term headwinds. Management’s guidance for Q4 anticipates continued revenue decline and margin compression, with normalization expected in 2026 as transformation efforts scale.

Executive Commentary

Strategic Positioning

1. LiveLift and Measurement-Led Differentiation

The launch of LiveLift, Ibotta’s new campaign measurement and optimization solution, is central to the company’s repositioning as a performance marketing platform. LiveLift enables clients to track incremental sales and campaign ROI in near real time, a capability previously unavailable for in-store CPG promotions. Early pilots have shown strong client engagement, with 83% of completed pilots leading to further investment. The partnership with Circana, third-party media measurement, further addresses advertiser demands for independent validation, unlocking new client budgets and accelerating platform trust.

2. Network Model and Third-Party Publisher Growth

Ibotta’s shift from direct-to-consumer to a third-party publisher network (IPN, Ibotta Performance Network) is reshaping the business. Partnerships with Instacart and DoorDash have driven the majority of redeemer growth, broadening reach and reducing customer acquisition costs. However, this model brings lower per-user engagement and higher publisher costs, requiring ongoing optimization of offer mix and partner economics.

3. Automation and Client Experience as 2026 Theme

Management has declared “make it easy” as the 2026 company theme, focusing on automation, streamlined campaign setup, and improved client onboarding. Investments in AI and machine learning are already reducing campaign setup time by 50%, and the roadmap includes further automation of projections, reporting, and sales enablement. The company is betting that easier, faster, and more turnkey processes will drive adoption and retention as LiveLift scales.

4. Sales Organization Rebuild and Go-to-Market Execution

Following a sales reorganization and VP-level hiring, Ibotta is prioritizing continuity, training, and B2B marketing to support its transformation. Improved input metrics, such as meetings per rep and account engagement, suggest early traction. The full sales team will be enabled to pitch LiveLift starting Q1 2026, which management expects to accelerate pilot velocity and broader adoption.

5. Investment in Third-Party Validation and Platform Trust

To overcome advertiser skepticism, Ibotta will invest several million dollars in third-party lift studies in 2026, viewing this as a necessary upfront cost to establish credibility and unlock larger campaign allocations. This mirrors the “grading our own homework” concern and is a critical step for mainstream CPG adoption.

Key Considerations

This quarter’s results reflect a business in the midst of a fundamental model shift, balancing revenue headwinds with strategic investments in measurement, network expansion, and automation. Investors should weigh the near-term volatility against the longer-term potential of a scaled, outcomes-driven platform.

Key Considerations:

• Measurement-Led Adoption Curve: LiveLift and Circana partnership are driving early pilot wins, but full revenue impact will lag due to client budget cycles and pilot-to-rollout timelines.
• Third-Party Channel Economics: Network growth is positive for reach, but comes with lower engagement and higher publisher costs, requiring margin management and offer optimization.
• Sales Execution Risk: Recent sales team turnover and reorganization could drag continuity, but new leadership and training investments aim to stabilize go-to-market motion.
• Macro CPG Headwinds: Persistent consumer sentiment weakness, tariff risk, and SNAP program disruption are dampening client promotional spend and elongating sales cycles.
• AI and Automation Leverage: Early AI-driven efficiency gains (e.g., 50% reduction in campaign setup time) are promising, but scaling automation across the platform remains a multi-quarter journey.

Risks

Near-term revenue declines and macro CPG caution present ongoing headwinds, especially as clients remain hesitant to ramp promotional budgets. The shift to third-party publishers introduces margin risk and reduces direct control over user engagement. Execution on automation, client onboarding, and sales continuity will be critical, and delays in LiveLift adoption or third-party validation uptake could push out the transformation timeline. Regulatory changes affecting SNAP or tariffs could further pressure the CPG client base.

Forward Outlook

For Q4 2025, Ibotta guided to:

• Revenue of $80 to $85 million (midpoint: -16% YoY)
• Adjusted EBITDA of $9 to $12 million (midpoint: 13% margin)

For full-year 2025, management expects:

• Second half performance in line with mid-year expectations for both revenue and adjusted EBITDA

Management highlighted:

• Seasonal marketing spend and full sales team staffing will pressure Q4 margins
• 2026 expected to return to more normal seasonality, with low double-digit revenue decline from Q4 to Q1, then sequential growth as transformation gains traction

Takeaways

Ibotta’s Q3 marks a critical inflection as it leans into measurement, automation, and network effects, even as legacy revenue streams shrink. The company’s ability to scale LiveLift and validate outcomes for CPG clients will determine the pace of its transformation and margin recovery in 2026.

• Platform Shift Underway: Redeemer growth and third-party expansion show network leverage, but revenue and margin lag until measurement-led adoption scales.
• Execution Is Pivotal: Sales team stability, automation, and client onboarding are the next battlegrounds for unlocking LiveLift’s full revenue potential.
• 2026 Is a Proving Ground: Investors should track the velocity of LiveLift pilots, third-party validation uptake, and improvements in redeemer engagement as leading indicators of durable growth.

Conclusion

Ibotta’s Q3 performance highlights both the challenges and promise of its business model transformation. While revenue softness and margin pressure persist, the company’s investments in measurement, automation, and network expansion set the stage for a more scalable and defensible platform. Sustained execution in 2026 will be the critical test for long-term value creation.

Industry Read-Through

Ibotta’s pivot toward outcomes-based measurement and third-party validation reflects a broader CPG and retail media trend: advertisers are demanding granular, independently verified ROI before committing incremental spend. The shift from D2C to network-driven models mirrors platform strategies across retail media and digital promotions, but also brings new margin and engagement management challenges. Competitors in the retail media and digital coupon space should expect increased pressure to provide transparent, third-party-validated performance metrics, and to automate campaign execution for both brands and agency partners. The ability to scale measurement and make campaign setup frictionless is emerging as a key differentiator across the sector.

IBTA Technology Digital Advertising CPG Performance Marketing Automation Retail Media