Clear Secure, Inc. (NYSE:YOU) Q4 2024 Earnings Call Transcript

Clear Secure, Inc. (NYSE:YOU) Q4 2024 Earnings Call Transcript February 26, 2025

Clear Secure, Inc. beats earnings expectations. Reported EPS is $0.9, expectations were $0.28.

Operator: Good morning, and welcome to CLEAR’s Fiscal Fourth Quarter 2024 Conference Call. We have with us today, Caryn Seidman-Becker, Co-Founder, Chair and Chief Executive Officer; and Ken Cornick, Co-Founder, President and Chief Financial Officer. As a reminder, before we begin, today’s discussion contains forward-looking statements about the company’s future business and financial performance. These are based on management’s current expectations and are subject to risks and uncertainties. Factors that could cause actual results to differ materially from these statements are included in the documents the company has filed and furnished with the SEC, including today’s shareholders’ letter. The company disclaims any obligation to update any forward-looking statements that may be discussed during this call.

During this call, the company will discuss both GAAP and non-GAAP financial measures. A reconciliation of GAAP to non-GAAP financial measures is provided in today’s shareholder letter and the most recently filed annual report on Form 10-K. These items can be found in the Investor Relations section of CLEAR’s website. With that, I’ll turn the call over to Caryn.

Caryn Seidman-Becker: Good morning, and thank you for joining our fourth quarter 2024 earnings call. 2024 was a transformational year for CLEAR as our momentum accelerated, bringing our secure identity platform to more people in more places. A secure identity platform has never been more important. In the booming travel industry, the need to strengthen security and create frictionless experiences is critical. Enterprises feel the sense of urgency to prevent fraud, reduce insider risk and build trust and loyalty with their consumers. CLEAR’s singular identity platform addresses these needs in a turnkey way, and we are bringing powerful new products to market like NextGen Identity, [ face-first ] EnVe’s, TSA PreCheck Enrollment Provided by CLEAR and enterprise workforce security to name just a few.

In travel, we are leading with innovation and redefining what it means to strengthen security and delight travelers. Today, CLEAR Plus covers around 73% of airport volume with 166 lanes nationwide. With the rollout of NextGen Identity complete, 50% of our members are through the CLEAR lanes in less than 2 minutes, 85% in under 5 minutes and 91% in less than 7 minutes. The power of predictability in travel matters. The year-over-year improvement in member experience is evident. The lane of the future is here today, powered by our EnVe’s, which stands for enrollment and verification Pods and NextGen Identity, the highest fidelity digital identity at scale. EnVe’s are creating magic for our members. They are 5x faster, delivering a customer-centric seamless experience that members love.

Lane experience scores and throughput have improved significantly, and the EnVe rollout should be complete by March, streamlining our systems and driving significant operational efficiencies, serving members with 30% fewer pods. It is massively important that EnVe’s can be easily connected to eGates, something we have been passionate about for a long time. eGates drive automation, security and member experience. We are piloting eGates in select airports today and absolutely believe this technology should be a cornerstone of modernized airport infrastructure. The opportunity for CLEAR to deploy end-to-end automated lanes at no cost to the government or taxpayers will be game changing, and we are ready. We want to make airports great. The U.S. should be leading in technology and travel, and CLEAR has the products and innovation that can delight travelers and strengthen security, and it’s time to deploy it.

This is the dawn of a new day in Washington to unleash the power of public-private partnerships. We are pleased with the engagement we have seen with the new administration, and we are excited to bring much needed capital, innovation and technology to our airport partners, airline partners and the American traveling public. They deserve more. TSA PreCheck continued to scale in 2024. And today, we are at 91 locations. You are seeing the power of public-private partnerships with TSA PreCheck enrollment provided by CLEAR. By meeting travelers where they are, whether in airports, convenient retail locations or flagship destinations such as the Mall of America in the Oculus and New York City, we are bringing the benefits to more people in more places.

For 15 years, the vision for CLEAR has always been that you are you, that you should enroll once and use everywhere. With our day 1 vision in mind, we have renamed CLEAR Verified to CLEAR1. CLEAR1 is the one vertically integrated identity platform that helps enterprises prevent fraud, reduce insider risk, build trust and deliver seamless user experiences. CLEAR ONE’s embedded base of over 30 million members today and smart network maximizes security and minimizes friction with a holistic identity solution. We strengthen security for the enterprise and their users. Customers are using the platform and products to solve problems such as combating identity fraud and account takeovers, ensuring a verified workforce and improving operational efficiencies.

We serve multiple industries and stakeholders, reflecting the fact that identity is foundational today in the physical and the digital world. In health care, CLEAR1 is being used in different segments for both patients and the workforce. Community Health Network is deploying CLEAR1 across their enterprise, rolling out to both patients and employees, streamlining operations and reducing insider risk. Community Health results for the workforce were immediate, a 90% adoption rate and an initial 13% reduction in annual password reset calls. Community Health also expanded to patients, enabling secure frictionless account recovery. Additionally, a health data platform is using CLEAR to improve safety and the customer experience while reducing fraud in their clinical trials.

Similar to the travel industry, a secure identity platform can unlock end-to-end experiences in health care. Our CLEAR1 biometric multifactor authentication integration with Okta enables businesses to verify the person beyond the device. No development work is required to implement CLEAR within Okta workflows, so enterprise clients can instantly enhance security. As enterprises continue to be threatened or compromised, CLEAR’s biometric MFA is addressing the pressing need for secure workforce access in regulated industries and critical infrastructure. Driven by both CLEAR Travel and CLEAR1, we expect 2025 to be another year of strong top line growth, continued margin expansion and free cash flow of at least $310 million, which includes incremental year-over-year cash taxes and EnVe spend totaling $30 million.

As always, we remain focused on growing members, total bookings and free cash flow while continuing to build a brand that members and partners trust and love. Before I hand it over to Ken, I want to say it’s been an incredible 15-year journey, building CLEAR from 190,000 members to over 30 million today. The vision we had on day 1 is taking shape, and Ken and I are incredibly proud of where CLEAR is going and the team that is taking it there. Ken will step down from his operational roles and remain an adviser to CLEAR working on a wide range of exciting initiatives. We are thrilled to welcome Michael Barkin as our President; and Jen Hsu as our new CFO. Michael is a seasoned executive with tremendous financial and operational experience. And having been on the CLEAR Board for 5 years, Michael knows CLEAR extremely well and is excited about the opportunities ahead.

Jen Hsu has great experience leading teams at Chewy, and together, they will help CLEAR achieve our goals and realize our vision of building a global secure identity platform. With that, I’ll turn it over to Ken.

Kenneth Cornick: Thank you, Caryn. Fourth quarter revenue and total bookings grew 21% and 17%, respectively, driven by member growth, pricing, strong member retention and improvements in win-back activity. TSA PreCheck and CLEAR1 contributed several points to our growth rate. Flow-through was strong with over 60% incremental operating margins and 70% incremental EBITDA margins. We achieved a 24% full year adjusted EBITDA margin, which is up over 1,000 basis points year-over-year. Underpinning our financial results are the continued improvements in member experience that Caryn mentioned, driven by the rollout of EnVe’s. Total cumulative enrollments ended the year at $28.9 million, up $2.5 million in the quarter, which is record growth.

As of today, we are over 30 million members, reflecting continued CLEAR1 traction. Active CLEAR Plus members grew by 164,000 in the quarter. As we go through 2025, it is important to note that our renewal backlog by quarter is not evenly distributed as a result of historic airport openings, promotions, partnerships and credit card launches. Unlike monthly subscription businesses, we are an annual biller, so the number of members up for renewal in a particular quarter can materially impact that quarter’s net adds as does seasonal travel demand. In 2025, we expect a disproportionate share of the full year net adds to be in Q2 and Q4 in that order with the lowest net adds in Q1 and Q3. Q4 gross dollar retention was 88.5%, down 50 basis points sequentially.

The modest sequential decline is due to slightly fewer parent members adding their first family member at the higher price point, impacting this metric, but having nothing to do with cancellations. As we continue to roll out our home to gate experience and bring more value to our members, we believe ARPU can continue to increase without a material impact to member retention or member growth. Annual net member retention was 81.4%, which was down 10 basis points sequentially. Net member retention has stabilized, and we are seeing an uptick in win-back activity. We expect continued improvement in member retention in 2025 based on lane improvements, innovation and mix. We continue to optimize the business for gross dollar retention, which we introduced in the first quarter of 2024 as it embeds both member retention and ARPU growth.

We are sunsetting some of our early deep discount programs, which have been a drag on unit economics and our focus is on increasing value and average revenue per member. Therefore, we plan to report gross dollar retention instead of the annual net member retention metric going forward. Our emerging businesses, TSA PreCheck and CLEAR1 are contributing to our total bookings and gross profit dollar growth. We are making strong progress on TSA PreCheck off-airport enrollment locations and CLEAR1 pipeline conversion. A quick note on the tax receivable agreement or TRA. In the quarter, we recognized a onetime noncash net gain of $75 million, consisting of other expense of $91 million, offset by a tax benefit of $166 million. This is a onetime true-up to the balance sheet triggered by positive cumulative 3-year pretax income.

For further details, please refer to Note 17 in the 10-K, which will be filed this morning. Based on prevailing tax rates and our share ownership structure, we expect full year 2025 GAAP P&L taxes to range between 17% and 20%. From a cash tax perspective, the TRA should benefit us by a few hundred basis points versus GAAP, which will flow through operating cash flows. In 2024, we generated $284 million of free cash flow, up 42% year-over-year, while our share count shrunk 9% to end the year at 137.7 million shares. We will continue to allocate capital opportunistically with the goal of maximizing long-term shareholder value. We ended the year with cash of $613 million after repurchasing 1.8 million shares in Q4 at $26.36, including a block transaction from Delta.

For full year 2024, we repurchased 13.8 million shares at an average price of $19.78. So far in the first quarter, we have repurchased an additional 871,000 shares at an average price of $23.08. The first quarter 2025 dividend totaling $0.395 includes a $0.27 special cash dividend and a regular quarterly dividend of $0.125. As a reminder, the special dividend is a result of our favorable corporate structure, which requires an annual tax distribution to members, including [ PubCo ]. In Q1, we expect revenue of $207 million to $209 million and total bookings of $202 million to $204 million. In 2025, we expect free cash flow of at least $310 million, which includes incremental year-over-year cash taxes of $25 million as well as $9 million of EnVe CapEx, which will not recur in 2026, of which $5 million is incremental year-over-year.

On a comparable basis, this implies at least 20% free cash flow growth. Our free cash flow guidance assumes our credit card partnership will renew for the final year of the contract through June of 2026. We believe having a credit card partner is beneficial. It provides valuable awareness and distribution, and we expect to continue to have one in place. CLEAR has grown substantially from 2019 to 2025, and the unit economics should reflect where we are and where we are going. The gap between wholesale and retail price is significant. We get a lot of questions on the financial impacts, and we believe the deal currently depresses our total bookings and EBITDA while benefiting working capital. We are extremely well positioned to compound total bookings, revenue, EBITDA and free cash flow in 2025 and beyond.

Before going to Q&A, I just want to express my gratitude to the entire team at CLEAR for an amazing 15 years. It’s been the thrill of a lifetime to have partnered with Caryn in building an incredible business from the ground up. I’m personally ready to take a step back after an exhilarating run, and we are incredibly lucky to have Michael and Jen joining. I will be working closely with them both to ensure a seamless transition. With that, let’s go to Q&A.

Q&A Session

Operator: [Operator Instructions] Our first question comes from Joshua Reilly with Needham & Co.

Joshua Reilly: And first of all, Ken, I just want to say it’s been great working with you, and I appreciate all the support that you’ve given me over the last couple of years, and congrats on your retirement and the opportunity to spend some more time with your family. So maybe just starting off, can you review the puts and takes on the guidance for Q1 bookings? And what should we be considering as we look at the midpoint of $203 million or 12.5% year-over-year growth? And how much does a lower sequential price tailwind influence this guidance?

Kenneth Cornick: Josh, thanks for the kind words. So on bookings guidance, implies around 13% year-over-year growth. And look, January is seasonally slow for travel and lots of things are ramping in the quarter, like PreCheck locations. We actually had a few CLEAR1 deals closed in Q4 that were just as likely to close in Q1. Q4 incidentally was a record deal signing quarter for CLEAR1 with over 20 deals signed. And in terms of the pricing, we did lap $70 to $119 pricing for family in November and December for new and renewal, respectively. And we’re now going from $99 to $119. So those are all contributing factors. We have slightly less pricing tailwind in Q1. So nothing really — nothing in particular driving there. Those are all the factors.

Joshua Reilly: Got it. And then as we look at net adds, can you talk about — is there anything unusual in terms of the mix in net adds in the quarter?

Kenneth Cornick: So in terms of mix, you mean like trial versus paid upfront?

Joshua Reilly: Yes.

Kenneth Cornick: Got it. Yes. Actually, our trial count as a percent of the total Active CLEAR Plus members at the end of the year was down slightly year-over-year. The absolute number was up, but the percentage was down. That’s also a little bit of a contributing factor to Q1 as well.

Joshua Reilly: Got it. And then maybe just quickly on your comments around what’s going on with Amex depressing bookings and EBITDA. I guess what does this mean from your perspective? And how are you thinking about this relationship given that there’s one more year of renewal under the contract that Amex has behalf?

Kenneth Cornick: Look, we love Amex. We think having a credit card partner is important. It’s been a valuable brand awareness and distribution for us. But our business has scaled significantly since 2019. And as we’ve talked about, the gap between the wholesale and the retail price has widened to a fairly significant level. And we believe it depresses our bookings and EBITDA, obviously benefits our working capital. The wholesale price is so low relative to the $199 retail. Look, we believe the renewal rates at full price would be larger than the percentage discount rate.

Caryn Seidman-Becker: And we actually see that in our data when somebody would come off a lower-priced membership or a free membership, what the retention rates are.

Operator: Our next question comes from Ben Miller with Goldman Sachs.

Benjamin Miller: I guess as we think about factors like the rollout of the EnVe pods and lane of the future, improving the in-airport experience as well as prior period pricing actions, can you just update us on how you think about the balance between price and member count and what you view as normal or steady-state dollar or member retention you’re looking to achieve?

Caryn Seidman-Becker: Thanks, Ben. First of all, let’s just say, and I’m sure many people on the call have experienced it. We’re well through our EnVe rollout. And as we said, we think we’ll be pretty much complete by the end of the quarter. They are magic. So first face-first technology is massively important for the customer experience, for the ambassador experience for efficiency and for new services that we want to add as well. And so they are driving customer experience, which is connected to retention, but customer experience is also connected to win-backs and reactivation. It’s also connected to gross adds and conversion, and we’re going to be rolling out the EnVe’s for enrollment later in the second quarter. And so that’s also a great opportunity.

And then there are some other enrollment technologies that are coming as well. And so we’ve talked about ePassport and the capability to read chips and have people enroll through mobile. So there’s all sorts of opportunities this year with better technology and new technology to drive gross adds. I think we have to see how these things roll out. But we do expect net adds in — at the very least, the mid-single digits. And then from a pricing perspective, that’s why we’re really focused on gross dollar retention because we will be taking price. We will be repricing some free tiers to paid tiers. So even if those members came off, which we would hope they don’t, and we continue to drive the experience and drive the value with things like Perks, Assist and Scout, right, to really drive that differentiated home to gate experience.

But that is all positive on a gross dollar retention rate, which is why we are so incredibly focused on it.

Benjamin Miller: Great. And then maybe just as a follow-up, as you think about the evolution of airport security, both yourself and other offerings, how do you think about the investments you’ve made to position CLEAR and how that sets you up on a multiyear view compared to other offerings versus any kind of incremental investments you might need from here to continue to push that innovation?

Caryn Seidman-Becker: I love that question. So a wise man once told me that in business, it’s about hanging around the hoop. I think you could argue we’ve been hanging around the airport hoop for 15 years. And so we have invested and are incredibly well positioned to strengthen security and delight travelers at no cost to taxpayers. As I said on the call, we want to make airports great, and we have the technology and automation that can delight travelers and strengthen security. We’ve already invested in it, and it is time to deploy it, right? So what you see are incremental margin growth over the past few quarters and years, quite frankly, which reflects the investments coming to fruition. I would also say that based on some policies that made no sense, we were forced to get a little labor heavy in late ’23 and ’24, and we are on the other side of that.

So when you think about automation, it’s not just face-first technology. As I talked about in the call, it is attached to eGates, end-to-end automation that we pay for, right? And so when you think about the power of automation on margins and on strengthening security and on delighting travelers, it’s huge. When you think about our amazing ambassadors, adding value-added a la carte or bundled in the pricing of maybe new packages that we offer, Assist, which is in 4 airports, and we expect to roll out nationwide. We have a powerful solution that continues to get better, adding airports to the network. I think as Ken said, we cover about 73% today. And so adding end-to-end automation that you see in Dubai and Singapore and London and Tokyo, the U.S. should be leading in technology and travel, we’ve invested in it.

We’re ready to deploy it. And we are incredibly excited about the engagement that we’ve had with Washington and the belief and focus on public-private partnerships. We benefit airlines, airports, most importantly, travelers and the federal government at no cost to taxpayers from a security perspective. So we’re ready to roll. We’ve made the investments, and we are super excited to bring them to the American traveling public. They deserve it.

Operator: Our next question comes from Cory Carpenter with JPMorgan.

Cory Carpenter: Caryn, maybe to build on that question, just could you talk a bit more about the opportunity that you do see for the greater public-private partnership? Like what could that look like for CLEAR under perhaps a more welcoming administration? And then second question for either of you, just an update on TSA PreCheck, what you’re seeing and then some of the cross-sell you’re seeing between TSA PreCheck and CLEAR?

Caryn Seidman-Becker: Sure. I’ll take the first part, and then I’ll turn it over to Ken on PreCheck. Obviously, we all hear the administration talking about the privatization of the economy and the importance of American companies. So never have we been more aligned with the administration, a made-in-America company focused on aviation security that’s opt-in privacy protected focused on security, and at this for 15 years and been leading in biometric for 15 years. I think there’s a lot of understanding and appreciation for what we do. In fact, we get $0 from the federal government. We pay them, both we pay our airport partners a percentage of our revenue share, and we also pay TSA, a large percentage of our PreCheck enrollment costs.

So we are great partners to the federal state and local governments, and there’s a big appreciation for the technology that we can bring. I think the importance of having hardware that is really software-based, right? So you see that in the automotive industry today and the ability to stay ahead of the threat environment with software that is secure as opposed to doing long sort of analog hardware procurements that are updated in old-fashioned ways. And so the power of our platform and end-to-end, again, eGates front and back with face-first, it’s so powerful. The fact that we can enroll you in a bundle in CLEAR Plus PreCheck. CLEAR travelers are the most vetted travelers in the airport with our NextGen Identity and with automation, there’s just — and again, we’re going to allocate the capital to do it.

We’ve been buying some equipment. I think we talked to you guys a few quarters ago about our capital innovation and helping our airport partners buy equipment. So we’re already in there. And so it’s an incredibly exciting moment, and there absolutely is a focus to make airports great. There is an understanding that we have fallen behind. And so we are ready. We’ve made the investments. It would be margin positive, and it would be great for strengthening security and delighting travelers at no cost to taxpayers. There couldn’t be more alignment there.

Kenneth Cornick: And just quickly on the PreCheck. Look, PreCheck is going really well. It’s gaining great momentum. We’re live today in 91 locations, driving market share. In terms of upsell rates, we have 90% plus marketing opt-in rate. And our upsell rate for those members or those people joining PreCheck that are not already CLEAR members is approaching 20%.

Operator: Our next question comes from Dana Telsey with Telsey Advisory Group.

Dana Telsey: Well, nice to see the progress. And Ken, best of luck and best wishes. It’s a pleasure working with you. Caryn, can you just give any update on air travel trends and what you’re hearing and seeing there? And then also on some of the independent locations you’ve been opening like Mall of America, Westfield, how are those doing? And then I think there was a touch on pricing power. How do you think of the role of price in this upcoming fiscal year? And price increases, you mentioned maybe price decreases — not decreases, but adjusting price. How do you see the platform of pricing and how it goes through the year?

Caryn Seidman-Becker: To your point, you can’t decrease a 0 price. So we expect to take 0 up. But in terms of your macro travel trends, we continue to be bullish on travel. I know I sound like a broken record through the years. People love traveling. There was just a USTA report that’s really interesting, and I think had some good points in terms of travel trends. There was a record 3.1 million people going through airports last year. They expect to see 50 days like that, I think, this year over the next few years. And we continue to say that there’s going to be 4 million people a day going through U.S. airports by 2030. So the need for automation, the need for public-private partnerships is here and now. And when you look at us hosting the World Cup, right, the Olympics.

There is a focus on travel and bringing more people into the system from a trusted and vetted perspective so that you can have greater efficiency and greater security. I think when you look at what the airlines are saying in terms of capacity, what the hotels are saying, what the home share or room share people are saying, there is just so much excitement about travel. So continue to be very bullish on it. I think, quite frankly, it’s hard and getting harder, and that is our opportunity as a company that focuses on frictionless experiences. In terms of our out-of-airport enrollment network, it’s something that we’re very excited about, and we are scaling it aggressively in the first half of this year. And so it’s great when someone can come to Oculus or Mall of America to enroll in PreCheck, again, meeting people where they are.

But as we have these locations and we have more products, we think it gives us an opportunity to sell other things to people. And those locations are literally cash flow positive within the first few weeks. So it’s really powerful economics, and it is exciting to bring our brand meeting people where they are first with PreCheck and then other things. And then when you think of, again, just to go over to CLEAR1, the power of witnessed enrollments in high security needs, having both in-person and digital enrollment capabilities is really exciting. In terms of pricing, I’m going to turn that over to Ken.

Kenneth Cornick: Yes. So we see a number of pricing opportunities. The most obvious is taking the historically free tiers of airlines and beginning to charge for some of those. And so that is definitely an area of opportunity. And again, why we focus on gross dollar retention because if you have people that are using the lane and not paying you, net member retention is not the right metric to focus on that. So we — more to come on pricing, but that’s the sort of most near-term opportunity.

Caryn Seidman-Becker: And I would also say from a philosophy perspective, Dana, first and foremost, you got to drive value for customers, right? And so when you look at the value today at 59 airports, 166 lanes, the lane experience scores climbing. We talked about the statistics of predictability and adding services and lowering the implied price when you add greater services and having 30-plus million people on the platform means more people want to partner with us. There’s more we can offer our members. It really becomes this virtuous cycle. And so when we think about pricing, we think about bundles, we think about value-added benefits in those bundles that might not cost us anything, but lower the implied price for our customers.

You see us do partnerships with Uber, things of that nature. So there’s a lot of products that make sense specifically in travel and beyond to create value for our members and allows us to have a more holistic pricing philosophy. But pricing is something that we are going to be thoughtful about every single year, but also thinking about tiers.

Operator: Our next question comes from Mark Kelley with Stifel.

Mark Kelley: My first question, just going back to the comments you made, Caryn, about the new administration and just how well you’re positioned there. I guess if there’s less red tape that you have to deal with going forward, I’m assuming that might ease the G&A line, but are there other parts of the P&L that maybe we should be thinking about? And is there an opportunity for you in global entry to maybe facilitate that process? And then the other question I had was looking at annualized CLEAR Plus member usage that stabilized sequentially. Just curious what you’re seeing there and what we can expect throughout ’25?

Caryn Seidman-Becker: So let me take global entry. 13 years ago, we approached them on being an enrollment engine for global entry. So we believed it then, and we believe it now. PreCheck is off to an incredibly strong start. So first things first. And I think we are proving our strength as an enrollment partner and both security and customer experience and marketing and technology and product improvement. So I think that there’s a lot of potential once you have data to continue to drive new services off our infrastructure. So that’s number one. And again, I think as a made-in-America company, it’s really important as the government looks to have partnerships with trusted companies that are U.S.-based, that’s a really important moment for our company. And also as a qualified anti-terrorism technology, there’s just a lot more that we know that we can be doing, and we’re excited to share that story specifically now that we have data to prove it.

Kenneth Cornick: Yes. And in terms of efficiencies, I think some of the policies led to maybe some inefficiencies in our direct salaries line. And so that, I think, is the biggest area of opportunity, and we do expect to see operating leverage on a full year basis on that line.

Caryn Seidman-Becker: But if I can just add to that, it’s beyond just the line, it’s the revenue opportunity and the customer experience who wouldn’t want to move further faster to strengthen security and delight travelers at no cost to taxpayers. And so I do think it is in everyone’s benefit to move more quickly, specifically when this technology is turnkey.

Kenneth Cornick: And then just in terms of utilization, we had talked about the decline for the past few quarters being driven by mix. So as we’ve enlarged our TAM, bringing on a new pool of members that are maybe less frequent travelers in general. And then the post-COVID reduction, generally speaking, in travel or the post-COVID snapback, I should say, reduction in travel. So we’ve seen both of those things stabilize. And right now, our share of TSA traffic is up year-over-year, and we’re seeing strong volumes.

Caryn Seidman-Becker: I also think one other thing, and we continue to drive it. So the family plan, which is really beneficial, you want families traveling together or CLEAR members who are younger traveling on their own, but sometimes those younger people travel less.

Operator: Our next question comes from Michael Turrin with Wells Fargo.

Michael Turrin: Just a 2-parter I’ll give here. On retention rates, there have been some comments. Just the stabilization that held in Q4, can you comment on what you saw ending the year and if there are 4Q seasonal impacts on the renewal base at all to be mindful of there? And then on the early ’25 comment around strong bookings growth, any color on mix and drivers of that? Any way for us to think about the core CLEAR Plus business, price, TSA Pre or other efforts and just stack ranking and unpacking that comment a bit?

Kenneth Cornick: So on the retention question, I mean, there’s nothing seasonal as a 12-month trailing metric. So just stabilization along with the passenger experience, rolling out EnVe’s, et cetera. And we did see a snapback in the win backs as well. So nothing external there, just sort of execution. And so we’re really happy to see that there. In terms of the mix and sort of growth, I think it’s going to be driven by a number of things. As Caryn mentioned earlier, we do expect CLEAR Plus net member growth. We do expect some pricing. Certainly, you have rollover pricing from last year’s initiatives and then whatever we do this year. We have CLEAR1 ramping. We have PreCheck ramping. Those both contributed a few hundred basis points to growth rates, and we expect that to contribute more as the year goes on.

Caryn Seidman-Becker: And Michael, I would just add to that. Obviously, we’re very bullish on biometrics. It’s why we’re a secure identity platform and driving an end-to-end experience driven by technology and innovations to help travelers win the day of travel and having a predictable experience, I think, really is our opportunity to drive growth and to drive price and to drive new value-added services. And so I think when you think about it, you have to think about different tiers. There’s PreCheck, there’s CLEAR Plus PreCheck, there’s CLEAR Plus PreCheck plus other services. And I just — travel is growing. It’s difficult. We’re driving automation. And I think you have to really think through last year and the depression of NextGen Identity and all the secondary — reenrolling 7.5 million people in-person is hard and certainly has second derivative impacts on the business that we’re coming off of.

And then you roll — you marry NextGen Identity, which is the great unlock for so many different experiences plus EnVe’s, which are magic and much more efficient, there’s just so many opportunities going forward that we didn’t have over the last 2 years.

Operator: There are no further questions at this time. I would now like to turn the floor back over to Caryn for closing comments.

Caryn Seidman-Becker: Thank you for joining our fourth quarter 2024 earnings call. I am really proud of how our team is executing, and I am excited for the opportunities in front of us. Thank you.

Operator: This concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.