Ituran Location & Control Ltd. Q3 FY2025 earnings call

• Strong revenue growth across key parameters, with 11% increase in Q3 revenues. • Added 40,000 net subscribers in Q3, on track to add 220,000-240,000 net new subscribers in 2025. • In Israel, high car theft drives demand for services, including untapped markets like lower-priced new vehicles and second-hand cars, plus strong traction in usage-based insurance. • In Latin America, motorcycle market growth with BMW partnership in Brazil, e2Run mob smart mobility platform launched in Brazil and expanding to US. • Generated $21.3 million in operating cash flow, declared $10 million dividend, and purchased $1.5 million in shares under buyback program.

Third quarter revenues were $92,300,000, an 11% increase from Q3 of the previous year. Subscription fees were $67,600,000, up 13% year over year and representing 73% of total revenues. Product revenues were $24,700,000, up 4% year over year. The subscriber base reached 2,588,000 at quarter end, an increase of 40,000 in the quarter. Geographic breakdown of revenues: Israel 55%, Brazil 23%, rest of world 22%.

• On track to add 220,000-240,000 net new subscribers in 2025. • Ongoing efforts to grow via new products/services and partnerships with OEMs. • Launch of Ituranmob in US as a new growth avenue.

Q: Could you give more color on the launch in the U.S., target market, size, and when it might bear fruit?

A: Targets small to medium car rental companies in US; pilots in Orlando and New York with positive response, expecting growth starting 2026.

Q: What was driving the increase in operating expenses this quarter and margin expansion into next year?

A: Big majority of OpEx increase from FX effect; margins expected to expand as subscriber base grows.

Q: How is subscriber momentum performing versus original guidance for the year?

A: On track to meet 220,000-240,000 range; drivers include OEM partnerships, aftermarket in Brazil, and UBI in Israel.

Q: Talk about motorcycles in South America and partnership with BMW.

A: Partnership with BMW Motorrad in Brazil for motorcycle telematics; expecting tens of thousands of new subscribers from 2026, expanding to other manufacturers.

Q: ARPU increase, product and service mix or FX?

A: ARPU increase due to FX; FX was better in Q3 2025.

Q: Expectation about revenue next year in North America?

A: No specific revenue guidance, but efforts to increase revenues.

Q: Theft insurance providers in Israel not requiring tests, and disintermediation worry?

A: Insurance companies can't require specific solutions; Ituran has strong market share in Israel; focus on recurring services to maintain business.

Q: Update on efforts in India?

A: Joint venture in India, signed large contract with Mercedes Benz for commercial cars, but market is premature with low margins, but long-term potential.