LENDINGTREE REPORTS SECOND QUARTER 2024 RESULTS
LendingTree (NASDAQ: TREE) reported its Q2 2024 results, showcasing a 15% revenue growth to $210.1M. Net income reached $7.8M, or $0.58 per diluted share. The Insurance segment led the charge with a 109% YoY revenue increase to $122.1M. However, Home and Consumer segments recorded declines: Home revenue dropped 23% to $32.2M, and Consumer revenue fell 32% to $55.9M. Adjusted EBITDA was $23.5M, down 12% YoY. The company repurchased $161M of 2025 convertible notes at a $9M discount. Full-year 2024 guidance was updated to project revenues of $830M-$870M and Adjusted EBITDA of $85M-$95M.
LendingTree (NASDAQ: TREE) ha riportato i risultati del secondo trimestre 2024, evidenziando una crescita delle entrate del 15%, raggiungendo i $210,1 milioni. Il reddito netto ha raggiunto i $7,8 milioni, pari a $0,58 per azione diluita. Il settore Assicurativo ha guidato la crescita con un aumento delle entrate del 109% su base annua, per un totale di $122,1 milioni. Tuttavia, i settori Casa e Consumatori hanno registrato cali: le entrate per il settore Casa sono scese del 23% a $32,2 milioni, mentre le entrate del settore Consumatori sono diminuite del 32% a $55,9 milioni. L'EBITDA rettificato è stato di $23,5 milioni, in calo del 12% su base annua. L'azienda ha riacquistato $161 milioni di obbligazioni convertibili 2025 con uno sconto di $9 milioni. Le previsioni per l'intero anno 2024 sono state aggiornate, prevedendo entrate comprese tra $830 milioni e $870 milioni e un EBITDA rettificato tra $85 milioni e $95 milioni.
LendingTree (NASDAQ: TREE) reportó sus resultados del segundo trimestre de 2024, mostrando un crecimiento del 15% en ingresos alcanzando los $210.1 millones. El ingreso neto llegó a $7.8 millones, o $0.58 por acción diluida. El segmento de Seguros lideró el crecimiento con un aumento del 109% interanual en ingresos, alcanzando $122.1 millones. Sin embargo, los segmentos de Vivienda y Consumidor registraron caídas: los ingresos de Vivienda disminuyeron un 23% a $32.2 millones, y los ingresos de Consumidor cayeron un 32% a $55.9 millones. El EBITDA ajustado fue de $23.5 millones, disminuyendo un 12% interanual. La empresa recompró $161 millones de notas convertibles de 2025 con un descuento de $9 millones. La guía para todo el año 2024 se actualizó para proyectar ingresos de entre $830 millones y $870 millones y un EBITDA ajustado de entre $85 millones y $95 millones.
LendingTree (NASDAQ: TREE)는 2024년 2분기 실적을 발표하며 15%의 매출 성장을 기록해 $210.1M에 달했습니다. 순이익은 $7.8M, 즉 희석 주당 $0.58에 도달했습니다. 보험 부문은 전년 대비 109%의 매출 증가로 $122.1M을 기록하며 성장의 선두주자가 되었습니다. 그러나 주택 및 소비자 부문은 감소세를 보였습니다: 주택 매출은 23% 감소하여 $32.2M에, 소비자 매출은 32% 감소하여 $55.9M에 이르렀습니다. 조정된 EBITDA는 $23.5M로, 전년 대비 12% 감소했습니다. 회사는 2025년 전환사채 $161M을 $9M의 할인율로 재매입했습니다. 2024년 전체 연도 가이던스는 $830M-$870M의 매출과 $85M-$95M의 조정된 EBITDA를 예상하도록 업데이트되었습니다.
LendingTree (NASDAQ: TREE) a publié ses résultats du deuxième trimestre 2024, montrant une croissance des revenus de 15%, atteignant 210,1 millions de dollars. Le bénéfice net a atteint 7,8 millions de dollars, soit 0,58 $ par action diluée. Le secteur de l'Assurance a été le moteur de la croissance avec une augmentation des revenus de 109 % par rapport à l'année précédente, atteignant 122,1 millions de dollars. Cependant, les secteurs de l'Habitat et des Consommateurs ont enregistré des baisses : les revenus de l'Habitat ont chuté de 23 % à 32,2 millions de dollars, et les revenus du secteur des Consommateurs ont diminué de 32 % à 55,9 millions de dollars. L'EBITDA ajusté s'est élevé à 23,5 millions de dollars, en baisse de 12 % par rapport à l'année précédente. L'entreprise a racheté pour 161 millions de dollars d'obligations convertibles 2025 avec un rabais de 9 millions de dollars. Les prévisions pour l'ensemble de l'année 2024 ont été mises à jour, prévoyant des revenus entre 830 millions et 870 millions de dollars et un EBITDA ajusté entre 85 millions et 95 millions de dollars.
LendingTree (NASDAQ: TREE) hat die Ergebnisse des zweiten Quartals 2024 veröffentlicht und ein Einkommenswachstum von 15% auf $210,1 Millionen gezeigt. Der Nettogewinn erreichte $7,8 Millionen, was $0,58 pro verwässerter Aktie entspricht. Das Versicherungsgeschäft führte mit einem Umsatzanstieg von 109% im Vergleich zum Vorjahr auf $122,1 Millionen. Allerdings verzeichneten die Segmente Haus und Verbraucher Rückgänge: Die Einnahmen im Wohnbereich sanken um 23% auf $32,2 Millionen, und die Einnahmen im Verbrauchersegment fielen um 32% auf $55,9 Millionen. Das bereinigte EBITDA betrug $23,5 Millionen, was einem Rückgang von 12% im Jahresvergleich entspricht. Das Unternehmen hat $161 Millionen an wandelbaren Anleihen 2025 mit einem Rabatt von $9 Millionen zurückgekauft. Die Prognose für das Gesamtjahr 2024 wurde aktualisiert und sieht Umsätze zwischen $830 Millionen und $870 Millionen sowie ein bereinigtes EBITDA zwischen $85 Millionen und $95 Millionen vor.
- 15% revenue growth to $210.1M.
- Net income of $7.8M, or $0.58 per diluted share.
- Insurance segment revenue increased 109% YoY to $122.1M.
- Repurchased $161M of 2025 convertible notes at a $9M discount.
- Home segment revenue decreased 23% to $32.2M.
- Consumer segment revenue fell 32% to $55.9M.
- Adjusted EBITDA decreased 12% YoY to $23.5M.
Insights
LendingTree's Q2 2024 results demonstrate a mixed performance across segments, with overall revenue growth driven primarily by the Insurance segment. Key highlights include:
- Revenue increased 15% year-over-year to $210.1 million
- GAAP net income of $7.8 million or $0.58 per diluted share
- Variable marketing margin decreased to 34% from 42% in Q2 2023
- Adjusted EBITDA declined 12% to $23.5 million
The Insurance segment's strong performance, with revenue more than doubling, offset declines in the Home and Consumer segments. However, the company's profitability metrics showed some pressure, likely due to increased marketing expenses to drive growth in Insurance.
The company's debt management efforts are noteworthy, with a $161 million repurchase of 2025 convertible notes at a $9 million discount. This proactive approach to managing its balance sheet is positive for long-term financial health.
LendingTree's updated full-year guidance suggests confidence in continued growth, particularly in the Insurance segment. However, investors should monitor the company's ability to improve profitability metrics alongside top-line growth in the coming quarters.
Insurance Segment Continues Strong Rebound Driving
- Consolidated revenue of
$210.1 million - GAAP net income of
$7.8 million $0.58 - Variable marketing margin of
$70.9 million - Adjusted EBITDA of
$23.5 million - Adjusted net income per share of
$0.54
The company has posted a letter to shareholders on the company's website at investors.lendingtree.com.
"Our Insurance segment generated exceptional growth in the second quarter with revenue more than doubling from the prior year period. We expect our leading market position will result in meaningfully larger revenue generation through the remainder of this year," said Doug Lebda, Chairman and CEO. "Our company continues to benefit from the diversity of our business model. As Insurance continues to grow both revenue and VMD, we are leaning into our highest margin Consumer segment to acquire more high-intent customers for our lender partners."
Scott Peyree, President and COO, commented, "The growth in our Insurance business during the quarter well surpassed our expectations, and led us to beat the high end of our quarterly revenue guidance. For most of the last two years, our team focused on matching the highest quality consumers searching for insurance policies with limited carrier demand. We are now seeing the benefit of that focus. We have been employing that same strategy in our Consumer business, improving our relationship with our network lenders by helping them close more loans with our consumers to position ourselves ahead of any future improvement in lending conditions."
Jason Bengel, CFO, added, "I am very excited to assume CFO responsibilities at LendingTree. Having previously served as the leader of our Finance department, as well as driving our efficiency and internal strategy initiatives, I know our team is well positioned to continue improving our balance sheet and harvesting operating leverage by operating with focus and discipline. During the quarter we were able to repurchase
Second Quarter 2024 Business Results
- Home segment revenue of
$32.2 million 23% over second quarter 2023 and produced segment profit of$9.3 million 30% over the same period.- Within Home, revenue from Home Equity of
$22.0 million 13% over prior year.
- Within Home, revenue from Home Equity of
- Consumer segment revenue of
$55.9 million 32% over second quarter 2023.- Within Consumer, personal loans revenue of
$26.9 million 4% over prior year. - Revenue from our small business offering decreased
12% over prior year.
- Within Consumer, personal loans revenue of
- Insurance segment revenue of
$122.1 million 109% over second quarter 2023 and translated into segment profit of$36.4 million 47% over the same period.
LendingTree Summary Financial Metrics | |||||||||||
(In millions, except per share amounts) | |||||||||||
Three Months Ended | Y/Y | Three Months Ended | Q/Q | ||||||||
2024 | 2023 | % Change | 2024 | % Change | |||||||
Total revenue | $ 210.1 | $ 182.5 | 15 % | $ 167.8 | 25 % | ||||||
Income before income taxes | $ 9.4 | $ 0.1 | — % | $ 1.6 | — % | ||||||
Income tax expense | $ (1.6) | $ (0.2) | — % | $ (0.6) | — % | ||||||
Net income (loss) | $ 7.8 | $ (0.1) | — % | $ 1.0 | — % | ||||||
Net income (loss) % of revenue | 4 % | — % | 1 % | ||||||||
Income (loss) per share | |||||||||||
Basic | $ 0.58 | $ (0.01) | $ 0.08 | ||||||||
Diluted | $ 0.58 | $ (0.01) | $ 0.08 | ||||||||
Variable marketing margin | |||||||||||
Total revenue | $ 210.1 | $ 182.5 | 15 % | $ 167.8 | 25 % | ||||||
Variable marketing expense (1) (2) | $ (139.2) | $ (106.0) | 31 % | $ (98.4) | 41 % | ||||||
Variable marketing margin (2) | $ 70.9 | $ 76.5 | (7) % | $ 69.4 | 2 % | ||||||
Variable marketing margin % of revenue (2) | 34 % | 42 % | 41 % | ||||||||
Adjusted EBITDA (2) | $ 23.5 | $ 26.7 | (12) % | $ 21.6 | 9 % | ||||||
Adjusted EBITDA % of revenue (2) | 11 % | 15 % | 13 % | ||||||||
Adjusted net income (2) | $ 7.2 | $ 14.7 | (51) % | $ 9.2 | (22) % | ||||||
Adjusted net income per share (2) | $ 0.54 | $ 1.14 | (53) % | $ 0.70 | (23) % | ||||||
(1) | Represents the portion of selling and marketing expense attributable to variable costs paid for advertising, direct marketing and related expenses. Excludes overhead, fixed costs and personnel-related expenses. |
(2) | Variable marketing expense, variable marketing margin, variable marketing margin % of revenue, adjusted EBITDA, adjusted EBITDA % of revenue, adjusted net income and adjusted net income per share are non-GAAP measures. Please see "LendingTree's Reconciliation of Non-GAAP Measures to GAAP" and "LendingTree's Principles of Financial Reporting" below for more information. |
LendingTree Segment Results | |||||||||||
(In millions) | |||||||||||
Three Months Ended | Y/Y | Three Months Ended | Q/Q | ||||||||
2024 | 2023 | % Change | 2024 | % Change | |||||||
Home (1) | |||||||||||
Revenue | $ 32.2 | $ 41.6 | (23) % | $ 30.4 | 6 % | ||||||
Segment profit | $ 9.3 | $ 13.3 | (30) % | $ 9.6 | (3) % | ||||||
Segment profit % of revenue | 29 % | 32 % | 32 % | ||||||||
Consumer (2) | |||||||||||
Revenue | $ 55.9 | $ 82.5 | (32) % | $ 51.5 | 9 % | ||||||
Segment profit | $ 26.9 | $ 40.7 | (34) % | $ 27.4 | (2) % | ||||||
Segment profit % of revenue | 48 % | 49 % | 53 % | ||||||||
Insurance (3) | |||||||||||
Revenue | $ 122.1 | $ 58.4 | 109 % | $ 85.9 | 42 % | ||||||
Segment profit | $ 36.4 | $ 24.8 | 47 % | $ 33.4 | 9 % | ||||||
Segment profit % of revenue | 30 % | 42 % | 39 % | ||||||||
Other (4) | |||||||||||
Revenue | $ — | $ — | — % | $ — | — % | ||||||
(Loss) | $ (0.1) | $ (0.3) | 67 % | $ — | — % | ||||||
Total revenue | $ 210.1 | $ 182.5 | 15 % | $ 167.8 | 25 % | ||||||
Total segment profit | $ 72.5 | $ 78.5 | (8) % | $ 70.5 | 3 % | ||||||
Brand marketing expense (5) | $ (1.6) | $ (2.0) | (20) % | $ (1.1) | 45 % | ||||||
Variable marketing margin | $ 70.9 | $ 76.5 | (7) % | $ 69.4 | 2 % | ||||||
Variable marketing margin % of revenue | 34 % | 42 % | 41 % | ||||||||
(1) | The Home segment includes the following products: purchase mortgage, refinance mortgage, and home equity loans. |
(2) | The Consumer segment includes the following products: credit cards, personal loans, small business loans, student loans, auto loans, deposit accounts and debt settlement. We ceased offering credit repair with the closing of Ovation at the end of Q2 2023. |
(3) | The Insurance segment consists of insurance quote products and sales of insurance policies. |
(4) | The Other category primarily includes marketing revenue and related expenses not allocated to a specific segment. |
(5) | Brand marketing expense represents the portion of selling and marketing expense attributable to variable costs paid for advertising, direct marketing and related expenses that are not assignable to the segments' products. This measure excludes overhead, fixed costs and personnel-related expenses. |
Financial Outlook*
Today we are updating our outlook for full-year 2024 and introducing our outlook for the third quarter.
Full-year 2024:
- Revenue of
$830 $870 million $690 $720 million - Variable Marketing Margin of
$280 $300 million - Adjusted EBITDA of
$85 $95 million
Third-quarter 2024:
- Revenue:
$230 $260 million - Variable Marketing Margin:
$73 $80 million - Adjusted EBITDA:
$23 $27 million
*LendingTree is not able to provide a reconciliation of projected variable marketing margin or adjusted EBITDA to the most directly comparable expected GAAP results due to the unknown effect, timing and potential significance of the effects of legal matters and tax considerations. Expenses associated with legal matters and tax considerations have in the past, and may in the future, significantly affect GAAP results in a particular period.
Quarterly Conference Call
A conference call to discuss LendingTree's second quarter 2024 financial results will be webcast live today, July 25, 2024 at 5:00 PM Eastern Time (ET). The live audiocast is open to the public and will be available on LendingTree's investor relations website at investors.lendingtree.com. Following completion of the call, a recorded replay of the webcast will be available on the website.
LENDINGTREE'S RECONCILIATION OF NON-GAAP MEASURES TO GAAP
Variable Marketing Expense
Below is a reconciliation of selling and marketing expense, the most directly comparable GAAP measure, to variable marketing expense. See "LendingTree's Principles of Financial Reporting" for further discussion of the Company's use of this non-GAAP measure.
Three Months Ended | |||
June 30, | March 31, | June 30, | |
(in thousands) | |||
Selling and marketing expense | $ 148,387 | $ 108,176 | $ 116,065 |
Non-variable selling and marketing expense (1) | (9,140) | (9,855) | (10,107) |
Variable marketing expense | $ 139,247 | $ 98,321 | $ 105,958 |
(1) | Represents the portion of selling and marketing expense not attributable to variable costs paid for advertising, direct marketing and related expenses. Includes overhead, fixed costs and personnel-related expenses. |
LENDINGTREE'S RECONCILIATION OF NON-GAAP MEASURES TO GAAP
Variable Marketing Margin
Below is a reconciliation of net income (loss), the most directly comparable table GAAP measure, to variable marketing margin and net income (loss) % of revenue to variable marketing margin % of revenue. See "LendingTree's Principles of Financial Reporting" for further discussion of the Company's use of these non-GAAP measures.
Three Months Ended | |||
June 30, | March 31, | June 30, | |
(in thousands, except percentages) | |||
Net income (loss) | $ 7,752 | $ 1,016 | $ (115) |
Net income (loss) % of revenue | 4 % | 1 % | — % |
Adjustments to reconcile to variable marketing margin: | |||
Cost of revenue | 8,411 | 8,545 | 9,302 |
Non-variable selling and marketing expense (1) | 9,140 | 9,855 | 10,107 |
General and administrative expense | 27,118 | 25,796 | 29,160 |
Product development | 10,374 | 11,857 | 10,601 |
Depreciation | 4,601 | 4,667 | 4,684 |
Amortization of intangibles | 1,467 | 1,489 | 1,982 |
Restructuring and severance | 202 | 23 | 3,558 |
Litigation settlements and contingencies | (7) | 36 | 488 |
Interest expense (income), net | 1,201 | 6,638 | 6,940 |
Other income | (1,052) | (1,034) | (439) |
Income tax expense | 1,686 | 559 | 227 |
Variable marketing margin | $ 70,893 | $ 69,447 | $ 76,495 |
Variable marketing margin % of revenue | 34 % | 41 % | 42 % |
(1) | Represents the portion of selling and marketing expense not attributable to variable costs paid for advertising, direct marketing and related expenses. Includes overhead, fixed costs and personnel-related expenses. |
LENDINGTREE'S RECONCILIATION OF NON-GAAP MEASURES TO GAAP
Adjusted EBITDA
Below is a reconciliation of net income (loss), the most directly comparable table GAAP measure, to adjusted EBITDA and net income (loss) % of revenue to adjusted EBITDA % of revenue. See "LendingTree's Principles of Financial Reporting" for further discussion of the Company's use of these non-GAAP measures.
Three Months Ended | |||
June 30, | March 31, | June 30, | |
(in thousands, except percentages) | |||
Net income (loss) | $ 7,752 | $ 1,016 | $ (115) |
Net income (loss) % of revenue | 4 % | 1 % | — % |
Adjustments to reconcile to adjusted EBITDA: | |||
Amortization of intangibles | 1,467 | 1,489 | 1,982 |
Depreciation | 4,601 | 4,667 | 4,684 |
Restructuring and severance | 202 | 23 | 3,558 |
Loss on impairments and disposal of assets | 413 | 368 | 140 |
Loss on impairment of investments | — | — | 1,440 |
Non-cash compensation | 7,437 | 7,789 | 9,204 |
Acquisition expense | — | — | 4 |
Litigation settlements and contingencies | (7) | 36 | 488 |
Interest expense (income), net | 1,201 | 6,638 | 6,940 |
Dividend income | (1,225) | (1,034) | (1,879) |
Income tax expense | 1,686 | 559 | 227 |
Adjusted EBITDA | $ 23,527 | $ 21,551 | $ 26,673 |
Adjusted EBITDA % of revenue | 11 % | 13 % | 15 % |
LENDINGTREE'S RECONCILIATION OF NON-GAAP MEASURES TO GAAP
Adjusted Net Income
Below is a reconciliation of net income (loss), the most directly comparable table GAAP measure, to adjusted net income and net income (loss) per diluted share to adjusted net income per share. See "LendingTree's Principles of Financial Reporting" for further discussion of the Company's use of these non-GAAP measures.
Three Months Ended | |||
June 30, | March 31, | June 30, | |
(in thousands, except per share amounts) | |||
Net income (loss) | $ 7,752 | $ 1,016 | $ (115) |
Adjustments to reconcile to adjusted net income: | |||
Restructuring and severance | 202 | 23 | 3,558 |
Loss on impairments and disposal of assets | 413 | 368 | 140 |
Loss on impairment of investments | — | — | 1,440 |
Non-cash compensation | 7,437 | 7,789 | 9,204 |
Acquisition expense | — | — | 4 |
Litigation settlements and contingencies | (7) | 36 | 488 |
Gain on extinguishment of debt | (8,619) | — | — |
Adjusted net income | $ 7,178 | $ 9,232 | $ 14,719 |
Net income (loss) per diluted share | $ 0.58 | $ 0.08 | $ (0.01) |
Adjustments to reconcile net income (loss) to adjusted net income | (0.04) | 0.62 | 1.15 |
Adjustments to reconcile effect of dilutive securities | — | — | — |
Adjusted net income per share | $ 0.54 | $ 0.70 | $ 1.14 |
Adjusted weighted average diluted shares outstanding | 13,407 | 13,276 | 12,928 |
Effect of dilutive securities | — | — | 13 |
Weighted average diluted shares outstanding | 13,407 | 13,276 | 12,915 |
Effect of dilutive securities | 150 | 176 | — |
Weighted average basic shares outstanding | 13,257 | 13,100 | 12,915 |
LENDINGTREE'S PRINCIPLES OF FINANCIAL REPORTING
LendingTree reports the following non-GAAP measures as supplemental to GAAP:
- Variable marketing expense
- Variable marketing margin
- Variable marketing margin % of revenue
- Earnings Before Interest, Taxes, Depreciation and Amortization, as adjusted for certain items discussed below ("Adjusted EBITDA")
- Adjusted EBITDA % of revenue
- Adjusted net income
- Adjusted net income per share
Variable marketing expense, variable marketing margin and variable marketing margin % of revenue are related measures of the effectiveness of the Company's marketing efforts. Variable marketing margin is a measure of the efficiency of the Company's operating model, measuring revenue after subtracting variable marketing expense. Variable marketing expense represents the portion of selling and marketing expense attributable to variable costs paid for advertising, direct marketing, and related expenses, and excludes overhead, fixed costs, and personnel related expenses. The Company's operating model is highly sensitive to the amount and efficiency of variable marketing expenditures, and the Company's proprietary systems are able to make rapidly changing decisions concerning the deployment of variable marketing expenditures (primarily but not exclusively online and mobile advertising placement) based on proprietary and sophisticated analytics.
Adjusted EBITDA and adjusted EBITDA % of revenue are primary metrics by which LendingTree evaluates the operating performance of its businesses, on which its marketing expenditures and internal budgets are based and, in the case of adjusted EBITDA, by which management and many employees are compensated in most years.
Adjusted net income and adjusted net income per share supplement GAAP net income and GAAP net income per diluted share by enabling investors to make period to period comparisons of those components of the most directly comparable GAAP measures that management believes better reflect the underlying financial performance of the Company's business operations during particular financial reporting periods. Adjusted net income and adjusted net income per share exclude certain amounts, such as non-cash compensation, non-cash asset impairment charges, gain/loss on disposal of assets, gain/loss on investments, restructuring and severance, litigation settlements and contingencies, acquisition and disposition income or expenses including with respect to changes in fair value of contingent consideration, gain/loss on extinguishment of debt, contributions to the LendingTree Foundation, one-time items which are recognized and recorded under GAAP in particular periods but which might be viewed as not necessarily coinciding with the underlying business operations for the periods in which they are so recognized and recorded, the effects to income taxes of the aforementioned adjustments, any excess tax benefit or expense associated with stock-based compensation recorded in net income in conjunction with FASB pronouncement ASU 2016-09, and income tax (benefit) expense from a full valuation allowance. LendingTree believes that adjusted net income and adjusted net income per share are useful financial indicators that provide a different view of the financial performance of the Company than adjusted EBITDA (the primary metric by which LendingTree evaluates the operating performance of its businesses) and the GAAP measures of net income and GAAP net income per diluted share.
These non-GAAP measures should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. LendingTree provides and encourages investors to examine the reconciling adjustments between the GAAP and non-GAAP measures set forth above.
Definition of LendingTree's Non-GAAP Measures
Variable marketing margin is defined as revenue less variable marketing expense. Variable marketing expense is defined as the expense attributable to variable costs paid for advertising, direct marketing and related expenses, and excluding overhead, fixed costs and personnel-related expenses. The majority of these variable advertising costs are expressly intended to drive traffic to our websites and these variable advertising costs are included in selling and marketing expense on the Company's consolidated statements of operations and consolidated income.
EBITDA is defined as net income from continuing operations excluding interest, income taxes, amortization of intangibles and depreciation.
Adjusted EBITDA is defined as EBITDA excluding (1) non-cash compensation expense, (2) non-cash impairment charges, (3) gain/loss on disposal of assets, (4) gain/loss on investments, (5) restructuring and severance expenses, (6) litigation settlements and contingencies, (7) acquisitions and dispositions income or expense (including with respect to changes in fair value of contingent consideration), (8) contributions to the LendingTree Foundation (9) dividend income, and (10) one-time items.
Adjusted net income is defined as net income (loss) excluding (1) non-cash compensation expense, (2) non-cash impairment charges, (3) gain/loss on disposal of assets, (4) gain/loss on investments, (5) restructuring and severance expenses, (6) litigation settlements and contingencies, (7) acquisitions and dispositions income or expense (including with respect to changes in fair value of contingent consideration), (8) gain/loss on extinguishment of debt, (9) contributions to the LendingTree Foundation, (10) one-time items, (11) the effects to income taxes of the aforementioned adjustments, (12) any excess tax benefit or expense associated with stock-based compensation recorded in net income in conjunction with FASB pronouncement ASU 2016-09, and (13) income tax (benefit) expense from a full valuation allowance.
Adjusted net income per share is defined as adjusted net income divided by the adjusted weighted average diluted shares outstanding. For periods which the Company reports GAAP loss from continuing operations, the effects of potentially dilutive securities are excluded from the calculation of net loss per diluted share from continuing operations because their inclusion would have been anti-dilutive. In periods where the Company reports GAAP loss from continuing operations but reports positive non-GAAP adjusted net income, the effects of potentially dilutive securities are included in the denominator for calculating adjusted net income per share if their inclusion would be dilutive.
LendingTree endeavors to compensate for the limitations of these non-GAAP measures by also providing the comparable GAAP measures with equal or greater prominence and descriptions of the reconciling items, including quantifying such items, to derive the non-GAAP measures. These non-GAAP measures may not be comparable to similarly titled measures used by other companies.
One-Time Items
Adjusted EBITDA and adjusted net income are adjusted for one-time items, if applicable. Items are considered one-time in nature if they are non-recurring, infrequent or unusual, and have not occurred in the past two years or are not expected to recur in the next two years, in accordance with SEC rules. For the periods presented in this report, there are no adjustments for one-time items.
Non-Cash Expenses That Are Excluded From LendingTree's Adjusted EBITDA and Adjusted Net Income
Non-cash compensation expense consists principally of expense associated with the grants of restricted stock, restricted stock units and stock options. These expenses are not paid in cash and LendingTree includes the related shares in its calculations of fully diluted shares outstanding. Upon settlement of restricted stock units, exercise of certain stock options or vesting of restricted stock awards, the awards may be settled on a net basis, with LendingTree remitting the required tax withholding amounts from its current funds. Cash expenditures for employer payroll taxes on non-cash compensation are included within adjusted EBITDA and adjusted net income.
Amortization of intangibles are non-cash expenses relating primarily to acquisitions. At the time of an acquisition, the intangible assets of the acquired company, such as purchase agreements, technology and customer relationships, are valued and amortized over their estimated lives. Amortization of intangibles are only excluded from adjusted EBITDA.
Safe Harbor Statement Under the Private Securities Litigation Reform Act of 1995
The matters contained in the discussion above may be considered to be "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations or anticipations of LendingTree and members of our management team. Factors currently known to management that could cause actual results to differ materially from those in forward-looking statements include the following: adverse conditions in the primary and secondary mortgage markets and in the economy, particularly interest rates and inflation; default rates on loans, particularly unsecured loans; demand by investors for unsecured personal loans; the effect of such demand on interest rates for personal loans and consumer demand for personal loans; seasonality of results; potential liabilities to secondary market purchasers; changes in the Company's relationships with network partners, including dependence on certain key network partners; breaches of network security or the misappropriation or misuse of personal consumer information; failure to provide competitive service; failure to maintain brand recognition; ability to attract and retain consumers in a cost-effective manner; the effects of potential acquisitions of other businesses, including the ability to integrate them successfully with LendingTree's existing operations; accounting rules related to excess tax benefits or expenses on stock-based compensation that could materially affect earnings in future periods; ability to develop new products and services and enhance existing ones; competition; effects of changing laws, rules or regulations on our business model; allegations of failure to comply with existing or changing laws, rules or regulations, or to obtain and maintain required licenses; failure of network partners or other affiliated parties to comply with regulatory requirements; failure to maintain the integrity of systems and infrastructure; liabilities as a result of privacy regulations; failure to adequately protect intellectual property rights or allegations of infringement of intellectual property rights; and changes in management. These and additional factors to be considered are set forth under "Risk Factors" in our Annual Report on Form 10-K for the period ended December 31, 2023, in our Quarterly Report on Form 10-Q for the period ended March 31, 2024, and in our other filings with the Securities and Exchange Commission. LendingTree undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results or expectations.
About LendingTree, Inc.
LendingTree, Inc. is the parent of LendingTree, LLC and several companies owned by LendingTree, LLC (collectively, "LendingTree" or the "Company").
LendingTree is one of the nation's largest, most experienced online financial platforms, created to give consumers the power to win financially. LendingTree provides customers with access to the best offers on loans, credit cards, insurance and more through its network of approximately 400 financial partners. Since its founding, LendingTree has helped millions of customers obtain financing, save money, and improve their financial and credit health in their personal journeys. With a portfolio of innovative products and tools and personalized financial recommendations, LendingTree helps customers achieve everyday financial wins.
LendingTree, Inc. is headquartered in
Investor Relations Contact:
investors@lendingtree.com
Media Contact:
press@lendingtree.com
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SOURCE LendingTree, Inc.
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