Trough AEBITDA Levels Set to Inflect as Insurance Recovery Gathers Pace
Consolidated revenue of $134.4 million
GAAP net income of $12.7 million or $0.98 per diluted share
Variable marketing margin of $60.6 million
Adjusted EBITDA of $15.5 million
Adjusted net income per share of $0.28
CHARLOTTE, N.C., Feb. 27, 2024 /PRNewswire/ — LendingTree, Inc. (NASDAQ:TREE), operator of LendingTree.com, the nation’s leading online financial services marketplace, today announced results for the quarter ended December 31, 2023. The Company has posted a shareholder letter on its investor relations website at investors.lendingtree.com.
“Our company continues to prove durable to adverse economic conditions, as we generated another quarter of solid results despite ongoing pressure from higher interest rates and persistent inflation,” said Doug Lebda, Chairman and CEO. “We have taken decisive action to simplify our company, reduce operating costs, improve our technology and data infrastructure, and fortify our balance sheet. The business is well positioned to benefit from an improved economic environment going forward.”
Scott Peyree, President and COO, commented, “The recovery that began in our Insurance segment during Q4 has continued into the new year. We are very excited to be returning to growth. Our lending businesses, including both Home and Consumer, have reached a level of stability over the past three months from a credit tightening perspective that we have not seen in over a year. With the changes we have undertaken to make our company more efficient and agile, we now have a solid foundation to begin leaning into sequential growth opportunities in multiple lending categories.”
Trent Ziegler, CFO, added, “Despite the numerous external challenges we faced in 2023, the business generated $78.5 million of AEBITDA and $55 million of free cashflow for the year. During the quarter we repurchased $100 million of our 2025 convertible notes at a discount to par, and maintain $112 million of cash on balance sheet. We are committed to addressing the remainder of this maturity in the most efficient manner possible for our shareholders.”
Fourth Quarter 2023 Business Highlights
Home segment revenue of $25.1 million decreased 48% over fourth quarter 2022 and produced segment profit of $8.1 million, down 50% over the same period.
Within Home, mortgage revenue of $9.2 million declined 59% over the prior year period.
Consumer segment revenue of $49.5 million decreased 43% over fourth quarter 2022.
Within Consumer, credit card revenue of $8.1 million decreased 57% year-over-year.
Personal loans revenue of $21.9 million decreased 24% over prior year.
Insurance segment revenue of $59.6 million decreased 11% from fourth quarter 2022 and translated into segment profit of $25.2 million, a decrease of 2% over the same period.
LendingTree Summary Financial Metrics
(In millions, except per share amounts)
Three Months Ended
December 31,
Y/Y
Three Months Ended
September 30,
Q/Q
2023
2022
% Change
2023
% Change
Total revenue
$ 134.4
$ 202.1
(33) %
$ 155.2
(13) %
Income (loss) before income taxes
$ 13.1
$ (11.3)
216 %
(152.0)
109 %
Income tax (expense) benefit
(0.4)
0.9
(144) %
3.5
(111) %
Net income (loss)
$ 12.7
$ (10.4)
222 %
$ (148.5)
109 %
Net income (loss) % of revenue
9 %
(5) %
(96) %
Income (loss) per share
Basic
$ 0.98
$ (0.81)
$ (11.43)
Diluted
$ 0.98
$ (0.81)
$ (11.43)
Variable marketing margin
Total revenue
$ 134.4
$ 202.1
(33) %
$ 155.2
(13) %
Variable marketing expense (1) (2)
$ (73.8)
$ (124.0)
(40) %
$ (87.5)
(16) %
Variable marketing margin (2)
$ 60.6
$ 78.1
(22) %
$ 67.7
(10) %
Variable marketing margin % of revenue (2)
45 %
39 %
44 %
Adjusted EBITDA (2)
$ 15.5
$ 16.7
(7) %
$ 21.8
(29) %
Adjusted EBITDA % of revenue (2)
12 %
8 %
14 %
Adjusted net income (2)
$ 3.6
$ 4.9
(27) %
$ 7.9
(54) %
Adjusted net income per share (2)
$ 0.28
$ 0.38
(26) %
$ 0.61
(54) %
(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
December 31,
Y/Y
Three Months Ended
September 30,
Q/Q
2023
2022
% Change
2023
% Change
Home (1)
Revenue
$ 25.1
$ 48.6
(48) %
$ 33.4
(25) %
Segment profit
$ 8.1
$ 16.3
(50) %
$ 11.3
(28) %
Segment profit % of revenue
32 %
34 %
34 %
Consumer (2)
Revenue
$ 49.5
$ 86.2
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