Business Context and Reporting Period
Company: Clear Secure, Inc. (Ticker: YOU)
Filing Type: Form 10-K (Annual Report)
Reporting Period: Fiscal year ended December 31, 2025
Business Overview: Clear Secure operates a secure identity platform connecting digital and physical experiences. Its primary offerings include CLEAR+, a consumer travel subscription service providing expedited airport security access; CLEAR1, a B2B identity verification solution; and TSA PreCheck® Enrollment services. As of December 31, 2025, the company reported 38.0 million Total CLEAR Members and operates across 60 airports nationwide.
Key Financial Metrics
| Metric | 2025 | 2024 | Change |
|---|---|---|---|
| Revenue | $900.8 million | $770.5 million | +17% |
| Net Income | $168.1 million | $225.3 million | -25% |
| Net Income Margin | 19% | 29% | -10 pts |
| Adjusted EBITDA | $262.2 million | $187.5 million | +40% |
| Adjusted EBITDA Margin | 29% | 24% | +5 pts |
| Free Cash Flow | $343.1 million | $283.7 million | +21% |
| Cash & Cash Equivalents | $85.7 million | $66.9 million | N/A |
| Marketable Securities | $614.4 million | $542.6 million | N/A |
| Debt | $0 outstanding | $0 outstanding | N/A |
Note: Net income decreased primarily due to a $196.5 million increase in income tax expense resulting from the release of valuation allowances in the prior year, which created a one-time tax benefit in 2024 not repeated in 2025.
Material Changes vs. Prior Period
- Revenue Growth: Revenue increased 17% year-over-year, driven by a 6% increase in Active CLEAR+ Members and price increases for memberships.
- Member Expansion: Total CLEAR Members grew 31% to 38.0 million, while Active CLEAR+ Members grew 6% to 7.6 million.
- Operating Expenses: General and administrative expenses rose 7% ($14.9 million), largely due to higher credit card fees and performance-based equity compensation. Cost of revenue share fees increased 18% due to higher fixed airport fees and per-member fees.
- Tax Impact: The effective tax rate shifted significantly from a benefit in 2024 to an expense in 2025. The 2024 benefit was driven by the release of a valuation allowance on deferred tax assets, whereas 2025 reflects a normalized tax expense.
- Capital Allocation: The company repurchased 5.3 million shares of Class A Common Stock for $126.3 million in 2025. It also paid quarterly dividends of $0.125 per share and a special dividend of $0.270 per share.
Guidance, Outlook, and Risks
Management Commentary & Outlook: Management expects to continue expanding CLEAR+ through airport network expansion and international traveler services. The company is scaling its TSA PreCheck® enrollment program and expanding CLEAR1 into new verticals such as healthcare and workforce. In February 2026, the company renewed its multi-year partnership with American Express and declared a new quarterly dividend of $0.15 and a special dividend of $0.20.
Key Risks & Contingencies:
- Regulatory & Compliance: The business is heavily regulated by the TSA and DHS. Changes in aviation security protocols or biometric regulations (e.g., BIPA, GDPR) could materially impact operations.
- Technology & Cybersecurity: As a holder of sensitive biometric data, the company faces significant cybersecurity risks. A breach could result in reputational damage and liability.
- Competitive Landscape: Competition includes offline alternatives, government-led biometric initiatives (TSA's Credential Authentication Technology), and large technology platforms.
- Tax Receivable Agreement (TRA): The company has a TRA liability of $244.7 million. It is obligated to pay 85% of tax savings realized from basis adjustments to former LLC members. Future payments depend on taxable income and stock price.
- Concession Agreements: A significant portion of operations relies on airport concession agreements which can be terminated by counterparties.
Investor Verification Checklist
- Tax Receivable Agreement Liability: Verify the $244.7 million TRA liability and the assumptions regarding future taxable income used to calculate it.
- Revenue Recognition: Review the accrual of partnership liabilities ($163.4 million) related to credit card benefits, which requires significant estimation of future enrollment volumes.
- Member Retention: Monitor Annual CLEAR+ Gross Dollar Retention, which decreased to 86.4% in 2025 from 88.5% in 2024.
- Debt Covenants: Confirm compliance with the Credit Agreement covenants, specifically the net leverage ratio, though no debt is currently outstanding.
- Regulatory Changes: Assess the impact of evolving biometric privacy laws (e.g., California, Illinois) and TSA policy changes on the core business model.