[Preliminary Q2 2025 Results and Revised 2025 Guidance](index=1&type=section&id=LENDINGTREE%20PROVIDES%20PRELIMINARY%20SECOND%20QUARTER%20RESULTS%20AND%20REVISED%202025%20GUIDANCE) LendingTree announced strong preliminary Q2 2025 financial results, exceeding prior guidance and leading to a raised full-year 2025 outlook [Executive Summary](index=1&type=section&id=Executive%20Summary) LendingTree announced strong preliminary Q2 2025 financial results, exceeding prior guidance with double-digit revenue growth across all segments, improved capital position, and a raised full-year 2025 outlook - All three business segments produced double-digit year-over-year revenue growth in the second quarter[2](index=2&type=chunk) - The company's capital position has improved significantly, with net leverage falling to **3x** at the end of the second quarter[2](index=2&type=chunk) - Management expressed increased confidence in continued improvement for the second half of the year, with the third-quarter forecast ahead of previous expectations[2](index=2&type=chunk) [Updated Financial Outlook](index=1&type=section&id=Updated%20Financial%20Outlook) This section provides LendingTree's preliminary Q2 2025 results and updated financial guidance for Q3 and the full year 2025 [Q2 2025 Preliminary Results](index=1&type=section&id=Q2%202025%20Preliminary%20Results) Preliminary Q2 2025 results surpassed prior guidance, with revenue reaching **$250 million**, Variable Marketing Margin **$83.6 million**, and Adjusted EBITDA **$31.8 million** Q2 2025 Preliminary Results vs. Prior Guidance | Metric | Preliminary Q2 2025 Result (in millions) | Previous Guidance (in millions) | | :--- | :--- | :--- | | Revenue | $250 | $241 - $248 | | Variable Marketing Margin | $83.6 | $80 - $84 | | Adjusted EBITDA | $31.8 | $29 - $31 | [Q3 2025 Preliminary Outlook](index=1&type=section&id=Q3%202025%20Preliminary%20Outlook) LendingTree projects continued growth for Q3 2025, with revenue expected between **$273 million** and **$281 million** and Adjusted EBITDA between **$34 million** and **$36 million** Q3 2025 Preliminary Financial Outlook | Metric | Q3 2025 Guidance Range (in millions) | | :--- | :--- | | Revenue | $273 - $281 | | Variable Marketing Margin | $86 - $89 | | Adjusted EBITDA | $34 - $36 | [Full-Year 2025 Updated Outlook](index=1&type=section&id=Full-Year%202025%20Updated%20Outlook) Reflecting strong performance, the company raised its full-year 2025 revenue forecast to **$1.0 - $1.05 billion**, with corresponding increases to Variable Marketing Margin and Adjusted EBITDA guidance Full-Year 2025 Updated Outlook vs. Prior Outlook | Metric | Updated 2025 Outlook (in millions) | Prior 2025 Outlook (in millions) | | :--- | :--- | :--- | | Revenue | $1,000 - $1,050 | $955 - $995 | | Variable Marketing Margin | $329 - $336 | $319 - $332 | | Adjusted EBITDA | $119 - $126 | $116 - $124 | [Reconciliation of Non-GAAP Measures to GAAP](index=2&type=section&id=LENDINGTREE%27S%20RECONCILIATION%20OF%20NON-GAAP%20MEASURES%20TO%20GAAP) This section provides detailed reconciliations of LendingTree's non-GAAP financial measures, including Variable Marketing Expense, Variable Marketing Margin, and Adjusted EBITDA, to their respective GAAP equivalents [Variable Marketing Expense Reconciliation](index=2&type=section&id=Variable%20Marketing%20Expense%20Reconciliation) For Q2 2025, GAAP Selling and marketing expense of **$176.8 million** was reconciled to non-GAAP Variable marketing expense of **$166.5 million** by excluding **$10.3 million** in non-variable costs Reconciliation of Selling and Marketing Expense to Variable Marketing Expense (Q2 2025) | Line Item | Amount (in thousands) | | :--- | :--- | | Selling and marketing expense (GAAP) | $176,753 | | Less: Non-variable selling and marketing expense | ($10,285) | | **Variable marketing expense (Non-GAAP)** | **$166,468** | [Variable Marketing Margin Reconciliation](index=2&type=section&id=Variable%20Marketing%20Margin%20Reconciliation) The company reconciled its Q2 2025 GAAP Net Income of **$8.9 million** to a non-GAAP Variable Marketing Margin of **$83.6 million**, representing **33%** of revenue after various adjustments Reconciliation of Net Income to Variable Marketing Margin (Q2 2025) | Line Item | Amount (in thousands) | | :--- | :--- | | Net income (GAAP) | $8,862 | | Adjustments (Cost of revenue, G&A, etc.) | $74,786 | | **Variable marketing margin (Non-GAAP)** | **$83,648** | [Adjusted EBITDA Reconciliation](index=3&type=section&id=Adjusted%20EBITDA%20Reconciliation) For Q2 2025, GAAP Net Income of **$8.9 million** was reconciled to a non-GAAP Adjusted EBITDA of **$31.8 million**, representing a **13%** margin after various add-backs Reconciliation of Net Income to Adjusted EBITDA (Q2 2025) | Line Item | Amount (in thousands) | | :--- | :--- | | Net income (GAAP) | $8,862 | | Adjustments (Amortization, Depreciation, Interest, etc.) | $22,931 | | **Adjusted EBITDA (Non-GAAP)** | **$31,793** | [Principles of Financial Reporting](index=4&type=section&id=LENDINGTREE%27S%20PRINCIPLES%20OF%20FINANCIAL%20REPORTING) This section defines LendingTree's non-GAAP measures, Variable Marketing Margin and Adjusted EBITDA, explaining their use for evaluating marketing effectiveness and operating performance, while noting the inability to reconcile forward-looking non-GAAP guidance to GAAP [Definitions of Non-GAAP Measures](index=4&type=section&id=Definitions%20of%20Non-GAAP%20Measures) LendingTree defines Variable Marketing Margin as a measure of marketing efficiency and Adjusted EBITDA as a primary metric for evaluating business operating performance, both excluding specific items - Variable marketing margin is a measure of the efficiency of the Company's operating model, representing revenue after subtracting variable marketing expense[12](index=12&type=chunk) - Adjusted EBITDA is a primary metric by which LendingTree evaluates the operating performance of its businesses and on which internal budgets and compensation are based[13](index=13&type=chunk) - The company cannot reconcile projected Variable Marketing Margin or Adjusted EBITDA to GAAP results due to the unknown effect of legal matters, tax considerations, and other variable items[15](index=15&type=chunk) [Additional Information](index=4&type=section&id=Additional%20Information) This section includes a safe harbor statement regarding forward-looking information and an overview of LendingTree's business operations [Safe Harbor Statement](index=4&type=section&id=Safe%20Harbor%20Statement) This section provides a standard legal disclaimer for forward-looking statements, cautioning that actual results may differ due to various risk factors including economic conditions, competition, and regulatory changes - The press release contains forward-looking statements subject to risks and uncertainties[16](index=16&type=chunk) - Key risk factors include adverse economic conditions (particularly interest rates and inflation), changes in relationships with network partners, competition, and evolving laws and regulations[16](index=16&type=chunk)[18](index=18&type=chunk) [About LendingTree, Inc.](index=5&type=section&id=About%20LendingTree%2C%20Inc.) LendingTree is one of the largest online financial platforms in the U.S., empowering consumers by providing access to loans, credit cards, and insurance offers through a network of over **430** financial partners - LendingTree is one of the nation's largest online financial platforms, providing customers access to offers on loans, credit cards, and insurance[20](index=20&type=chunk) - The company operates a network of over **430** financial partners to provide these offers to consumers[20](index=20&type=chunk)

Core Insights - LendingTree, Inc. reported strong financial results for Q2 2025, with Adjusted EBITDA increasing by 35% year-over-year, driven by revenue growth across all business segments [2][5] - The company has experienced five consecutive quarters of year-over-year revenue growth, with a positive outlook for continued growth [2][6] - The Insurance segment saw a revenue increase of 21% year-over-year, while the Consumer and Home segments also reported healthy gains despite challenging market conditions [2][6] Financial Performance - Total revenue for Q2 2025 was $250.1 million, a 19% increase from $210.1 million in Q2 2024 [4][8] - GAAP net income was $8.9 million, or $0.65 per diluted share, compared to $7.8 million, or $0.58 per diluted share in the same quarter last year [5][7] - Adjusted net income increased by 114% year-over-year to $15.4 million, with adjusted net income per share rising to $1.13 from $0.54 [5][25] Segment Performance - The Insurance segment generated $147.2 million in revenue, up 21% year-over-year, with a segment profit of $40.0 million, a 10% increase [6][8] - The Consumer segment reported revenue of $62.5 million, a 12% increase year-over-year, with personal loans revenue rising by 14% [6][8] - The Home segment achieved revenue of $40.4 million, a 25% increase year-over-year, with Home Equity revenue increasing by 38% [6][8] Capital Structure and Outlook - The company's net leverage improved to 3x from 5x over the past year, indicating a stronger capital position [2][6] - LendingTree aims to further reduce net leverage and enhance capital efficiency while continuing to invest in core business areas [2][6] - The company reiterated its financial outlook for Q3 and full-year 2025, projecting revenue between $273 million and $281 million [12][17]

Core Viewpoint - Tree.com (TREE) is positioned to potentially continue its earnings-beat streak in the upcoming report, having surpassed earnings estimates significantly in the last two quarters [1][2]. Earnings Performance - For the last reported quarter, Tree.com achieved earnings of $0.99 per share, exceeding the Zacks Consensus Estimate of $0.74 per share by 33.78% [2]. - In the previous quarter, the company reported earnings of $1.16 per share against an expected $0.37 per share, resulting in a surprise of 213.51% [2]. Earnings Estimates and Predictions - Estimates for Tree.com have been trending higher, influenced by its history of earnings surprises [5]. - The company currently has a positive Earnings ESP of +10.96%, indicating that analysts are optimistic about its earnings prospects [8]. - The combination of a positive Earnings ESP and a Zacks Rank of 3 (Hold) suggests a strong possibility of another earnings beat in the upcoming report [8]. Statistical Insights - Research indicates that stocks with a positive Earnings ESP and a Zacks Rank of 3 or better have a nearly 70% chance of producing a positive surprise [6]. - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate reflecting the latest analyst revisions [7].

Company Overview - Tree.com (TREE) shares increased by 22.6% to $50.34 in the last trading session, with a notable trading volume, compared to a 14.7% gain over the past four weeks [1] - LendingTree reported stronger-than-expected preliminary second-quarter 2025 results, with anticipated revenue of $250 million, surpassing the previous guidance of $241–$248 million [2] - Adjusted EBITDA for the second quarter is expected to be $31.8 million, exceeding the earlier range of $29–$31 million [2] Financial Guidance - TREE raised its full-year 2025 revenue guidance to between $1.00 and $1.05 billion, up from $955–$995 million [3] - Variable Marketing Margin (VMM) is now projected at $329–$336 million, compared to the previous estimate of $319–$332 million [3] - Adjusted EBITDA guidance for the full year is increased to $119–$126 million, up from $116–$124 million [3] Earnings Expectations - The company is expected to report quarterly earnings of $1.09 per share, reflecting a year-over-year increase of 101.9% [4] - Revenue expectations for the quarter are $243.36 million, representing a 15.8% increase from the same quarter last year [4] - The consensus EPS estimate for TREE has remained unchanged over the last 30 days, indicating a potential stability in stock price movements [5] Industry Context - Tree.com operates within the Zacks Financial - Mortgage & Related Services industry, where UWM Holdings Corporation (UWMC) recently closed 4.6% lower at $4.38, with a 10.9% return over the past month [5] - UWM's consensus EPS estimate has increased by 1.5% over the past month to $0.06, showing a year-over-year change of 50% [6]

Core Insights - LendingTree, Inc. reported strong financial performance with all three segments achieving double-digit year-over-year revenue growth in Q2 2025 [2] - The company anticipates continued improvement in financial performance for the second half of 2025, with Q3 forecasts exceeding previous expectations [2] - LendingTree's net leverage has significantly improved, falling to 3x by the end of Q2 2025 [2] Financial Results - Preliminary revenue for Q2 2025 is expected to be $250 million, surpassing the previous range of $241 - $248 million [5] - Variable Marketing Margin for Q2 2025 is anticipated at $83.6 million, at the high end of the prior outlook of $80 - $84 million [5] - Adjusted EBITDA for Q2 2025 is projected to be $31.8 million, exceeding the previous range of $29 - $31 million [5] Updated Financial Outlook - For Q3 2025, revenue is expected to be in the range of $273 - $281 million [5] - Variable Marketing Margin for Q3 is anticipated to be between $86 - $89 million [5] - Adjusted EBITDA for Q3 is projected to be in the range of $34 - $36 million [5] - Full-year 2025 revenue outlook has been updated to $1 billion to $1.05 billion, compared to the prior range of $955 - $995 million [5] Company Overview - LendingTree operates as a leading online financial services marketplace, providing access to various financial products through a network of over 430 partners [19] - The company aims to empower consumers to achieve financial success by offering personalized financial recommendations and innovative products [19]

Core Points - LendingTree, Inc. will release its fiscal second quarter 2025 results after market close on July 31, 2025 [1] - A conference call will be held at 5:00 p.m. ET to discuss the earnings release, which will also be webcast [2] - LendingTree is a leading online financial services marketplace, providing access to loans, credit cards, insurance, and more through a network of over 600 financial partners [3] Company Overview - LendingTree aims to empower consumers financially by helping them obtain financing, save money, and improve their financial health [3] - The company has a portfolio of innovative products and personalized financial recommendations to assist customers in achieving financial wins [3] - LendingTree is headquartered in Charlotte, NC [4]

Core Insights - Pagaya Technologies Ltd. (PGY) and LendingTree, Inc. (TREE) are fintech firms aiming to innovate the lending sector through different approaches [1][2] - PGY leverages AI for credit underwriting and securitization, while TREE operates an online marketplace connecting borrowers and lenders [1][2] Pagaya's Case - Pagaya's adaptable business model and capital-efficient structure allow it to diversify beyond personal loans into auto lending and point-of-sale financing, enhancing resilience [3][11] - The company has established a network of over 135 institutional partners and utilizes forward flow agreements for funding stability during market disruptions [4][6] - Pagaya's proprietary technology, including the Pre-screen solution, enables lenders to offer pre-approved loans, improving credit access with minimal marketing costs [5] - The capital-light model limits credit and market risk, maintaining liquidity and minimizing loan write-downs, with $206.5 million in cash against $507.8 million in debt as of March 31, 2025 [6][7] LendingTree's Case - LendingTree has evolved its strategy to diversify into non-mortgage products, including personal, auto, small business, and student loans, enhancing its marketplace offerings [8][9] - The launch of the WinCard in 2023 marks its entry into the branded credit market, while initiatives like SPRING and TreeQual improve cross-selling opportunities [9][10] - LendingTree's investment in EarnUp reflects its commitment to a tech-enabled ecosystem for financial health management [10] Financial Performance and Projections - Pagaya expects 2025 revenues between $1.175 billion and $1.3 billion, with year-over-year growth of 19.9% and 15.7% for 2025 and 2026, respectively [19] - The consensus estimate for Pagaya's earnings indicates a significant increase of 195.2% for 2025 [19] - In contrast, LendingTree projects 2025 revenues between $955 million and $995 million, with lower growth rates of 9.2% and 6.4% for 2025 and 2026, respectively [20] - LendingTree's earnings growth is expected to be 43.9% for 2025, but a decline of 3.5% for 2026 [21] Market Performance and Valuation - Pagaya's stock has surged 130.3% this year, while LendingTree's has decreased by 4.6% [13] - Pagaya's price-to-book (P/B) ratio is 3.66X, compared to LendingTree's 4.66X, indicating a more attractive valuation for Pagaya [14][15] - Pagaya's return on equity (ROE) is 9.28%, lower than LendingTree's 14.76%, suggesting LendingTree is more efficient in generating profits [15] Investment Outlook - Pagaya's rapid scaling, capital-light model, and strong growth outlook make it a compelling investment opportunity compared to LendingTree [23][24] - While LendingTree has a well-established marketplace, its growth is slowing, making Pagaya appear better positioned for long-term gains [24]

Revenue Growth - Revenue for the first quarter of 2025 increased by 43% to $239.7 million compared to $167.8 million in the first quarter of 2024[145] - The Insurance segment saw a revenue increase of $60.8 million, or 71%, reaching $146.7 million in Q1 2025, driven by a 41% increase in revenue per consumer and a 22% increase in volume[147] - The Home segment's revenue rose by $6.6 million, or 22%, to $37.0 million in Q1 2025, attributed to growth in home equity loans and mortgage products[148] - Revenue from home equity loans and lines of credit increased by $5.0 million, or 24%, to $25.8 million, with a 50% increase in volume[149] - The Consumer segment's revenue increased by $4.6 million, or 9%, to $56.0 million in Q1 2025[145] - Revenue from mortgage products increased by $1.6 million, or 16%, to $11.2 million in Q1 2025 from Q1 2024, driven by the refinance mortgage product[151] - Consumer segment revenue rose by $4.6 million, or 9%, to $56.0 million in Q1 2025, primarily due to increases in personal and small business loans[152] - Personal loans revenue increased by $3.3 million, or 16%, to $23.4 million in Q1 2025, supported by a 36% increase in volume[153] - Small business revenue surged by $6.4 million, or 48%, in Q1 2025, attributed to more consumers completing request forms and higher revenue per consumer[154] - Total revenue for the company increased by $71.96 million, or 43%, to $239.73 million in Q1 2025 compared to Q1 2024[172] Costs and Expenses - Total costs and expenses rose by 54% to $246.8 million in Q1 2025, compared to $160.6 million in Q1 2024[145] - Selling and marketing expenses increased by $64.6 million in Q1 2025, primarily due to higher advertising and promotional expenditures[158] - General and administrative expenses rose by $4.9 million in Q1 2025, with compensation and benefits increasing by $4.8 million[163] - Variable marketing expense increased to $162.0 million in Q1 2025 from $98.3 million in Q1 2024, reflecting a 64.8% rise[185] Profitability and Loss - Operating loss for Q1 2025 was $7.1 million, a significant decline from an operating income of $7.2 million in Q1 2024[145] - Net loss for Q1 2025 was $12.4 million, compared to a net income of $1.0 million in Q1 2024, marking a 1,318% decrease[145] - Adjusted EBITDA for Q1 2025 was $24.6 million, up from $21.6 million in Q1 2024, marking a 13.9% increase[192] User Growth and Engagement - The company added 0.8 million new users to its Spring platform, bringing total sign-ups to 32.1 million as of March 31, 2025[140] - Approximately $3.7 million of revenue, or 2% of total revenue, in Q1 2025 was attributed to registered Spring users who initiated transactions from the Spring platform[140] Cash Flow and Financing - As of March 31, 2025, cash and cash equivalents were $126.4 million, an increase from $106.6 million as of December 31, 2024[193] - Net cash provided by financing activities in Q1 2025 was $23.4 million, primarily from the 2024 Term Loan delayed draw[207] - The company repurchased approximately $20.0 million in principal amount of its 2025 notes for $19.7 million, resulting in a gain of $0.3 million[194] - The company expects cash flows from operations to be sufficient to fund operating needs for the next twelve months and beyond[195] Debt and Interest Rates - The company had $243.1 million outstanding under the 2021 Term Loan as of May 2, 2025[199] - A hypothetical 100-basis point change in market interest rates would result in a $2.4 million annual effect on interest paid under the Credit Facility and a $1.6 million annual effect on the 2024 Term Loan[210] - As of May 2, 2025, the Company had $243.1 million outstanding on its 2021 Term Loan Facility and $162.5 million outstanding on its 2024 Term Loan[210] Market Conditions - Fluctuations in interest rates significantly impact consumer demand for new mortgages and refinancing activity, affecting lender demand for mortgage leads[211] - When interest rates decline, consumer demand for mortgage refinancing increases, leading to higher website traffic and lower selling and marketing costs[211] - Conversely, when interest rates increase, consumer demand for refinancing decreases, resulting in lower website traffic and higher selling and marketing efforts[211] - Increased lender demand for leads occurs in a rising rate environment, which can lead to higher revenue earned per matched lead despite reduced refinancing demand[211] Insurance Segment Performance - Insurance revenue increased by 71% to $146.7 million in Q1 2025, with segment profit rising by 16% to $38.7 million[180] - The Insurance segment margin decreased to 26% in Q1 2025 from 39% in Q1 2024, attributed to re-entering higher cost marketing channels to meet increased carrier demand[181] - Cost of revenue as a percentage of revenue decreased to 4% in Q1 2025 from 5% in Q1 2024[156]

Core Insights - LendingTree, Inc. (TREE) reported an adjusted net income per share of 99 cents for Q1 2025, exceeding the Zacks Consensus Estimate of 74 cents and up from 70 cents in the prior-year quarter [1] - The company's total revenues grew by 43% year over year to $239.7 million, although this figure missed the Zacks Consensus Estimate by 1.8% [3] - A significant increase in total costs, which rose by 15.9% to $9.9 million, negatively impacted overall performance [3] Financial Performance - The adjusted EBITDA for Q1 2025 was $24.6 million, reflecting a 14.3% increase from the previous year [3] - The variable marketing margin increased to $77.7 million, up 11.9% year over year [3] - The company reported a GAAP net loss of $12.4 million, contrasting with a net income of $1 million in the same quarter last year [2] Cash and Debt Position - As of March 31, 2025, cash and cash equivalents stood at $126.4 million, an increase from $106.6 million as of December 31, 2024 [4] - Long-term debt rose to $387.7 million from $344.1 million as of December 31, 2024 [4] Future Outlook - For Q2 2025, total revenues are projected to be between $241 million and $248 million, with adjusted EBITDA expected to be in the range of $29-$31 million [6] - The 2025 revenue outlook has been updated to between $955 million and $995 million, down from the previous estimate of $985-$1.03 billion [7] - Adjusted EBITDA for 2025 is projected to be $116-$124 million, slightly revised from the earlier estimate of $116-$126 million [7] Strategic Insights - The company is focusing on inorganic growth to strengthen its online lending platform, with first-quarter results benefiting from increased EBITDA [8] - Efforts to diversify non-mortgage product offerings are expected to support future revenue growth [8]

Core Insights - Tree.com reported revenue of $239.7 million for the quarter ended March 2025, reflecting a year-over-year increase of 42.9% [1] - The company's EPS was $0.99, up from $0.70 in the same quarter last year, with an EPS surprise of +33.78% compared to the consensus estimate of $0.74 [1] - The reported revenue was slightly below the Zacks Consensus Estimate of $244.03 million, resulting in a revenue surprise of -1.77% [1] Revenue Breakdown - Consumer segment revenue was $56 million, slightly below the average estimate of $56.87 million, with a year-over-year change of +8.7% [4] - Home segment revenue reached $37 million, exceeding the average estimate of $34.74 million, representing a year-over-year increase of +21.7% [4] - Insurance segment revenue was $146.70 million, below the average estimate of $152.75 million, but showed a significant year-over-year increase of +70.8% [4] Segment Profit Analysis - Home segment profit was reported at $13.10 million, surpassing the average estimate of $10.88 million [4] - Insurance segment profit was $38.70 million, which was lower than the estimated $41.58 million [4] - Consumer segment profit was $27.10 million, slightly below the average estimate of $27.92 million [4] Stock Performance - Tree.com shares have returned -3.5% over the past month, compared to a -0.7% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 1 (Strong Buy), indicating potential for outperformance in the near term [3]