PART I. FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=7&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents EverQuote, Inc.'s unaudited condensed consolidated financial statements, including balance sheets, statements of operations and comprehensive income, statements of stockholders' equity, statements of cash flows, and detailed notes. The financial data reflects the company's performance for the three and six months ended June 30, 2025 and 2024, highlighting significant increases in revenue and net income, alongside changes in assets, liabilities, and equity [Condensed Consolidated Balance Sheets](index=7&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet shows a significant increase in total assets, primarily driven by a rise in cash and cash equivalents, while total liabilities saw a slight decrease. Stockholders' equity increased substantially, reflecting improved financial health | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (in thousands) | % Change | | :-------------------------- | :----------------------------- | :------------------------------- | :-------------------- | :------- | | Cash and cash equivalents | $148,188 | $102,116 | $46,072 | 45.1% | | Accounts receivable, net | $54,960 | $61,346 | $(6,386) | -10.4% | | Total current assets | $209,473 | $171,780 | $37,693 | 21.9% | | Total assets | $241,419 | $210,530 | $30,889 | 14.7% | | Total current liabilities | $69,192 | $72,649 | $(3,457) | -4.8% | | Total liabilities | $71,152 | $75,162 | $(4,010) | -5.3% | | Total stockholders' equity | $170,267 | $135,368 | $34,899 | 25.8% | [Condensed Consolidated Statements of Operations and Comprehensive Income](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) The company reported strong revenue growth and a significant increase in net income for both the three and six months ended June 30, 2025, compared to the prior year. This performance led to improved basic and diluted net income per share | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Change (in thousands) | % Change | | :------------------------------------ | :-------------------------------------------- | :-------------------------------------------- | :-------------------- | :------- | | Revenue | $156,629 | $117,140 | $39,489 | 33.7% | | Net income | $14,701 | $6,402 | $8,299 | 129.6% | | Basic Net income per share | $0.40 | $0.18 | $0.22 | 122.2% | | Diluted Net income per share | $0.39 | $0.17 | $0.22 | 129.4% | | Metric | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (in thousands) | % Change | | :------------------------------------ | :-------------------------------------------- | :-------------------------------------------- | :-------------------- | :------- | | Revenue | $323,261 | $208,205 | $115,056 | 55.3% | | Net income | $22,691 | $8,309 | $14,382 | 173.1% | | Basic Net income per share | $0.63 | $0.24 | $0.39 | 162.5% | | Diluted Net income per share | $0.60 | $0.23 | $0.37 | 160.9% | [Condensed Consolidated Statements of Stockholders' Equity](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Stockholders%27%20Equity) Stockholders' equity increased significantly from December 31, 2024, to June 30, 2025, primarily due to net income and stock-based compensation expense, partially offset by net issuance of common stock upon vesting of restricted stock units Table: Total Stockholders' Equity (in thousands) | Metric | December 31, 2024 (in thousands) | June 30, 2025 (in thousands) | Change (in thousands) | | :-------------------------- | :------------------------------- | :--------------------------- | :-------------------- | | Total Stockholders' Equity | $135,368 | $170,267 | $34,899 | | Additional Paid-in Capital | $316,511 | $328,546 | $12,035 | | Accumulated Deficit | $(181,179) | $(158,488) | $22,691 | - Net income contributed **$22,691 thousand** to stockholders' equity for the six months ended June 30, 2025[18](index=18&type=chunk) - Stock-based compensation expense added **$11,980 thousand** to additional paid-in capital for the six months ended June 30, 2025[18](index=18&type=chunk)[63](index=63&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=11&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating activities generated significantly more cash in the first six months of 2025 compared to 2024, while investing activities continued to use cash for property and equipment. Financing activities provided a small net cash inflow | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | Change (in thousands) | % Change | | :------------------------------------ | :-------------------------------------------- | :-------------------------------------------- | :-------------------- | :------- | | Net cash provided by operating activities | $48,603 | $22,818 | $25,785 | 113.0% | | Net cash used in investing activities | $(2,594) | $(1,622) | $(972) | 59.9% | | Net cash provided by financing activities | $56 | $1,771 | $(1,715) | -96.8% | | Net increase in cash, cash equivalents and restricted cash | $46,072 | $22,963 | $23,109 | 100.6% | [Notes to Unaudited Condensed Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) These notes provide detailed disclosures on the company's business, accounting policies, financial instrument fair values, goodwill, liabilities, debt agreements, stock-based compensation, commitments, legal proceedings, retirement plan, related party transactions, net income per share, segment information, and subsequent events [1. Nature of the Business and Basis of Presentation](index=12&type=section&id=1.%20Nature%20of%20the%20Business%20and%20Basis%20of%20Presentation) EverQuote, Inc. operates an online marketplace connecting consumers with property and casualty insurance providers, generating revenue primarily from selling consumer referrals. The company faces risks common to its industry, including rapid technological changes and competition. The financial statements are prepared on a continuity of operations basis, with sufficient cash expected for the next 12 months - EverQuote operates an online marketplace for property and casualty insurance, generating revenue by selling consumer referrals to insurance providers[25](index=25&type=chunk) - The company expects its cash and cash equivalents to be sufficient to fund operating expenses and capital expenditure requirements for at least the next **12 months**[27](index=27&type=chunk) [2. Summary of Significant Accounting Policies](index=12&type=section&id=2.%20Summary%20of%20Significant%20Accounting%20Policies) This section outlines the company's significant accounting policies, including the preparation of unaudited interim financial information, use of estimates, revenue recognition principles, disaggregation of revenue by channel and vertical, advertising expense treatment, and net income per share calculation. It also notes recently issued accounting pronouncements - Revenue is primarily derived from selling consumer referrals to insurance providers and is recognized upon delivery of referrals[35](index=35&type=chunk)[39](index=39&type=chunk) Table: Disaggregated Revenue by Distribution Channel | Distribution Channel | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Direct channels | 86% | 83% | 89% | 82% | | Indirect channels | 14% | 17% | 11% | 18% | Table: Disaggregated Revenue by Insurance Vertical (in thousands) | Insurance Vertical | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Automotive | $139,584 | $102,622 | $292,299 | $180,160 | | Home and renters | $17,034 | $13,884 | $30,938 | $26,573 | | Other | $11 | $634 | $24 | $1,472 | - Advertising expense significantly increased, totaling **$111.1 million** for the three months ended June 30, 2025 (up from **$80.7 million** in 2024) and **$230.9 million** for the six months ended June 30, 2025 (up from **$140.9 million** in 2024)[43](index=43&type=chunk) - The company is assessing the impact of new FASB ASUs 2023-09 (Income Tax Disclosures) and 2024-03 (Expense Disaggregation Disclosures), effective for annual periods ending **December 31, 2025**, and after **December 15, 2026**, respectively[46](index=46&type=chunk)[47](index=47&type=chunk) [3. Fair Value of Financial Instruments](index=14&type=section&id=3.%20Fair%20Value%20of%20Financial%20Instruments) The company's financial instruments measured at fair value on a recurring basis primarily consist of money market funds, classified as Level 1 within the fair value hierarchy. Other short-term assets and liabilities approximate their fair values Table: Fair Value Measurements of Cash Equivalents (in thousands) | Asset | June 30, 2025 (Level 1) | December 31, 2024 (Level 1) | | :------------ | :---------------------- | :-------------------------- | | Money market funds | $7,560 | $7,403 | - The carrying values of accounts receivable, accounts payable, and accrued expenses and other current liabilities approximate their fair values due to their short-term nature[33](index=33&type=chunk) [4. Goodwill and Acquired Intangible Assets](index=17&type=section&id=4.%20Goodwill%20and%20Acquired%20Intangible%20Assets) Goodwill is reviewed annually for impairment, with no impairments to date. Acquired intangible assets, primarily customer relationships and developed technology from the PolicyFuel acquisition, were sold in May 2025 as part of a litigation settlement - Goodwill remained unchanged at **$21.5 million** as of **June 30, 2025**, with no impairments recorded[15](index=15&type=chunk)[50](index=50&type=chunk) - Acquired intangible assets, with a carrying value of **$3.3 million** at **December 31, 2024**, were sold on **May 1, 2025**, as part of a litigation settlement[15](index=15&type=chunk)[51](index=51&type=chunk) [5. Accrued Expenses and Other Current Liabilities](index=17&type=section&id=5.%20Accrued%20Expenses%20and%20Other%20Current%20Liabilities) Accrued expenses and other current liabilities decreased from December 31, 2024, to June 30, 2025, primarily due to reductions in accrued employee compensation and benefits, and accrued advertising expenses Table: Accrued Expenses and Other Current Liabilities (in thousands) | Category | June 30, 2025 | December 31, 2024 | | :-------------------------------- | :------------ | :---------------- | | Accrued employee compensation and benefits | $3,866 | $4,796 | | Accrued advertising expenses | $2,287 | $2,947 | | Other current liabilities | $1,186 | $2,051 | | **Total** | **$7,339** | **$9,794** | [6. Loan and Security Agreement](index=17&type=section&id=6.%20Loan%20and%20Security%20Agreement) The company's previous $25.0 million revolving line of credit, collateralized by substantially all assets, expired on July 15, 2025. As of June 30, 2025, there were no outstanding amounts, and the company was in compliance with all covenants, including maintaining a minimum Adjusted Quick Ratio - The prior **$25.0 million** revolving line of credit expired on **July 15, 2025**[53](index=53&type=chunk)[55](index=55&type=chunk) - As of **June 30, 2025**, the company had **no outstanding amounts** under the revolving line of credit and was in compliance with all covenants[55](index=55&type=chunk) [7. Stock-Based Compensation](index=18&type=section&id=7.%20Stock-Based%20Compensation) The 2018 Equity Incentive Plan saw an increase in authorized shares and significant RSU activity, including new grants and vesting. Stock-based compensation expense increased across all categories for both the three and six months ended June 30, 2025 - The number of authorized shares for issuance under the 2018 Plan increased by **1,782,084 shares** effective **January 1, 2025**, with **2,593,467 shares** remaining available for future grant as of **June 30, 2025**[57](index=57&type=chunk) Table: Service-Based RSU Activity (since Dec 31, 2024) | Activity | Number of Shares | Weighted Average Grant-Date Fair Value | | :-------------------------- | :--------------- | :------------------------------------- | | Unvested balance Dec 31, 2024 | 2,079,245 | $15.17 | | Granted | 892,697 | $22.53 | | Vested | (574,934) | $16.06 | | Forfeited | (97,895) | $16.07 | | Unvested balance June 30, 2025 | 2,299,113 | $17.77 | Table: Performance-Based RSU (pRSU) Activity (since Dec 31, 2024) | Activity | Number of Shares | Weighted Average Grant-Date Fair Value | | :-------------------------- | :--------------- | :------------------------------------- | | Unvested balance Dec 31, 2024 | 327,075 | $15.58 | | Granted | 922,016 | $21.49 | | Vested | (102,208) | $15.58 | | Forfeited | — | — | | Unvested balance June 30, 2025 | 1,146,883 | $20.33 | Table: Stock-Based Compensation Expense (in thousands) | Expense Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Cost of revenue | $39 | $42 | $48 | $78 | | Sales and marketing | $2,006 | $1,652 | $3,571 | $3,246 | | Research and development | $1,558 | $1,426 | $2,928 | $2,738 | | General and administrative | $2,957 | $2,220 | $5,433 | $3,796 | | **Total** | **$6,560** | **$5,340** | **$11,980** | **$9,858** | [8. Commitments and Contingencies](index=20&type=section&id=8.%20Commitments%20and%20Contingencies) The company entered into a new five-year, $18.5 million advertising purchase commitment in June 2025. A significant legal proceeding related to the 2021 PolicyFuel acquisition was settled in May 2025, resulting in an $8.2 million legal settlement expense for the six months ended June 30, 2025 - In **June 2025**, the company entered into a **five-year, $18.5 million** advertising purchase commitment, with **$3.0 million** relating to the next twelve months[68](index=68&type=chunk) - A civil action regarding the **2021 PolicyFuel acquisition** was settled on **May 1, 2025**, by selling certain assets for **$0.5 million** cash consideration[69](index=69&type=chunk) - The legal settlement resulted in an **$8.2 million expense** for the six months ended **June 30, 2025**, representing the difference between the estimated fair value of assets sold and proceeds received[70](index=70&type=chunk) [9. Retirement Plan](index=21&type=section&id=9.%20Retirement%20Plan) The company contributed to its 401(k) defined-contribution plan, with contributions increasing for both the three and six months ended June 30, 2025, compared to the prior year Table: 401(k) Plan Contributions (in thousands) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30, | $400 | $200 | | Six Months Ended June 30, | $900 | $400 | [10. Related Party Transactions](index=21&type=section&id=10.%20Related%20Party%20Transactions) Expenses related to arrangements with related-party affiliates for website visitor referrals significantly increased for both the three and six months ended June 30, 2025, compared to the prior year Table: Related Party Expenses (in millions) | Period | 2025 | 2024 | | :-------------------------- | :---- | :---- | | Three Months Ended June 30, | $11.4 | $3.6 | | Six Months Ended June 30, | $18.6 | $5.9 | - Amounts due to related-party affiliates increased from **$2.5 million** at **December 31, 2024**, to **$9.3 million** at **June 30, 2025**[73](index=73&type=chunk) [11. Net Income per Share](index=22&type=section&id=11.%20Net%20Income%20per%20Share) This note provides a reconciliation of the numerators and denominators for basic and diluted net income per common share, detailing the impact of dilutive securities like stock options and restricted stock units Table: Weighted Average Common Shares Outstanding (in thousands) | Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Weighted average basic common shares outstanding | 36,327 | 34,910 | 36,104 | 34,649 | | Effect of dilutive securities: Options | 636 | 751 | 670 | 637 | | Effect of dilutive securities: RSUs | 1,051 | 1,037 | 1,067 | 868 | | Weighted average diluted common shares outstanding | 38,014 | 36,698 | 37,841 | 36,154 | - The company excluded **14 thousand** and **15 thousand** potential common shares from diluted EPS computation for the three and six months ended **June 30, 2025**, respectively, due to their anti-dilutive effect[74](index=74&type=chunk) [12. Segments and Geographical Information](index=22&type=section&id=12.%20Segments%20and%20Geographical%20Information) The company operates as a single reportable segment, with all revenue derived from customers in the United States. Net income (loss) is the primary performance measure for the Chief Operating Decision Maker (CODM) - The company manages its operations as a **single segment**, with net income (loss) used as the segment performance measure[76](index=76&type=chunk)[77](index=77&type=chunk) - All revenue is generated from customers in the **United States**[75](index=75&type=chunk) Table: Significant Segment Expenses (in thousands) | Expense Category | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :----------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Revenue | $156,629 | $117,140 | $323,261 | $208,205 | | Advertising expense | $111,109 | $80,685 | $230,881 | $140,932 | | Cash operating expense | $23,564 | $23,527 | $47,917 | $46,757 | | Other segment items, net | $7,255 | $6,526 | $21,772 | $12,207 | [13. Subsequent Events](index=24&type=section&id=13.%20Subsequent%20Events) Subsequent events include the enactment of the One Big Beautiful Bill Act (OBBBA) on July 4, 2025, a board-authorized share repurchase program of up to $50.0 million on July 22, 2025, and a new $60.0 million senior secured revolving credit facility entered into on August 1, 2025 - The One Big Beautiful Bill Act (OBBBA) was enacted on **July 4, 2025**, with the company evaluating its impact on financial statements[80](index=80&type=chunk) - On **July 22, 2025**, the board authorized a share repurchase program for up to **$50.0 million** of Class A common stock over one year[81](index=81&type=chunk) - On **August 1, 2025**, the company entered into a new **$60.0 million** senior secured revolving credit facility, replacing the prior agreement, with an option to increase by **$25.0 million**[82](index=82&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the company's financial condition and results of operations, including an overview of its business, key performance drivers, non-GAAP financial measures, and a detailed analysis of revenue and expenses. It also covers liquidity, capital resources, and critical accounting policies [Business Overview](index=27&type=section&id=Business%20Overview) EverQuote operates a leading online marketplace connecting consumers with property and casualty (P&C) insurance providers. The company's vision is to be the primary growth partner for P&C insurers, leveraging its data and technology platform to improve consumer acquisition and engagement - EverQuote operates an online marketplace connecting consumers with P&C insurance providers, aiming to be a leading growth partner for the industry[87](index=87&type=chunk) - Revenue is principally derived from consumer inquiries sold as referrals to insurance providers, with services being free for consumers[88](index=88&type=chunk) [Financial Highlights](index=27&type=section&id=Financial%20Highlights) The company achieved significant financial growth for the three and six months ended June 30, 2025, with substantial increases in total revenue, net income, and Adjusted EBITDA compared to the prior year Table: Financial Highlights (in millions) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Total Revenue | $156.6 | $117.1 | $323.3 | $208.2 | | Net Income | $14.7 | $6.4 | $22.7 | $8.3 | | Adjusted EBITDA | $22.0 | $12.9 | $44.5 | $20.5 | [Factors Affecting Performance](index=27&type=section&id=Factors%20Affecting%20Performance) Key factors influencing performance include the company's heavy reliance on the volatile auto insurance industry, the need to continuously expand consumer traffic and the network of insurance providers, and the impact of evolving federal and state regulations, particularly concerning telemarketing and data privacy - The company derived **90%** and **87%** of its revenue from auto insurance providers for the six months ended **June 30, 2025** and **2024**, respectively, making it highly dependent on the industry's performance[91](index=91&type=chunk) - The auto insurance industry remains volatile due to factors like claims, inflation, and policy premiums, which can impact carrier spending on customer acquisition[91](index=91&type=chunk) - Success depends on expanding consumer traffic through advertising channels and growing the insurance provider network, while also navigating regulatory changes in telemarketing (e.g., TCPA) and data privacy[92](index=92&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk) [Non-GAAP Financial Measure (Adjusted EBITDA)](index=28&type=section&id=Non-GAAP%20Financial%20Measure%20(Adjusted%20EBITDA)) Adjusted EBITDA is presented as a non-GAAP financial measure to supplement GAAP results, providing insights into core operating performance by excluding stock-based compensation, depreciation and amortization, legal settlement expense, interest income, and income taxes. It is used by management to evaluate performance and set operational goals - Adjusted EBITDA is defined as net income (loss) adjusted to exclude stock-based compensation, depreciation and amortization, legal settlement expense, interest income, and income taxes[97](index=97&type=chunk)[110](index=110&type=chunk) - Adjusted EBITDA is a key measure for management and the board to understand operating performance, establish budgets, and develop operational goals[97](index=97&type=chunk)[111](index=111&type=chunk) Table: Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :-------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Net income | $14,701 | $6,402 | $22,691 | $8,309 | | Stock-based compensation | $6,560 | $5,340 | $11,980 | $9,858 | | Depreciation and amortization | $918 | $1,236 | $2,139 | $2,499 | | Legal settlement | $332 | — | $8,232 | — | | Interest income | $(918) | $(456) | $(1,626) | $(842) | | Income tax expense | $363 | $406 | $1,047 | $692 | | **Adjusted EBITDA** | **$21,956** | **$12,928** | **$44,463** | **$20,516** | [Variable Marketing Dollars and Margin](index=28&type=section&id=Variable%20Marketing%20Dollars%20and%20Margin) Variable marketing dollars (VMD) and variable marketing margin (VMM) are key metrics used to assess advertising efficiency. VMD increased significantly due to higher carrier spend, while VMM decreased due to competitive pricing and changes in referral mix - Variable marketing dollars (VMD) are defined as revenue less advertising costs, and variable marketing margin (VMM) is VMD divided by revenue[98](index=98&type=chunk) Table: Variable Marketing Dollars and Margin (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change (in thousands) | % Change | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------- | :------- | | Revenue | $156,629 | $117,140 | $39,489 | 33.7% | | Less: total advertising expense | $111,109 | $80,685 | $30,424 | 37.7% | | Variable marketing dollars | $45,520 | $36,455 | $9,065 | 24.9% | | Variable marketing margin | 29.1% | 31.1% | -2.0 pp | -6.4% | | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change (in thousands) | % Change | | :-------------------------- | :------------------------------- | :------------------------------- | :-------------------- | :------- | | Revenue | $323,261 | $208,205 | $115,056 | 55.3% | | Less: total advertising expense | $230,881 | $140,932 | $89,949 | 63.8% | | Variable marketing dollars | $92,380 | $67,273 | $25,107 | 37.3% | | Variable marketing margin | 28.6% | 32.3% | -3.7 pp | -11.5% | - The decrease in variable marketing margin was attributed to competitive pricing for advertising spend and the relative mix of referral types[132](index=132&type=chunk) [Key Components of Results of Operations](index=30&type=section&id=Key%20Components%20of%20Results%20of%20Operations) This section details the components of revenue and operating expenses, including cost of revenue, sales and marketing, research and development, general and administrative, legal settlement, other income/expense, and income tax expense, providing a comparative analysis for the three and six months ended June 30, 2025 and 2024 [Revenue](index=30&type=section&id=Revenue_MD%26A) Total revenue increased significantly, primarily driven by growth in the automotive vertical due to increased carrier spending, particularly from the two largest customers. The home and renters vertical also contributed to revenue growth Table: Revenue Growth (in thousands) | Period | 2025 | 2024 | Change | % Change | | :-------------------------- | :--------- | :--------- | :------- | :------- | | Three Months Ended June 30, | $156,629 | $117,140 | $39,489 | 33.7% | | Six Months Ended June 30, | $323,261 | $208,205 | $115,056 | 55.3% | - The increase in revenue was primarily due to a **$37.0 million** increase in the automotive vertical for the three months and a **$112.1 million** increase for the six months, driven by increased carrier spend[117](index=117&type=chunk)[118](index=118&type=chunk) - Revenue from the home and renters vertical increased by **$3.2 million** for the three months and **$4.4 million** for the six months[117](index=117&type=chunk)[118](index=118&type=chunk) [Cost of Revenue](index=34&type=section&id=Cost%20of%20Revenue_MD%26A) Cost of revenue decreased slightly for the three months ended June 30, 2025, due to lower personnel-related costs, but increased for the six-month period primarily due to higher hosting costs, partially offset by decreased personnel costs Table: Cost of Revenue (in thousands) | Period | 2025 | 2024 | Change | % Change | | :-------------------------- | :------- | :------- | :------- | :------- | | Three Months Ended June 30, | $4,842 | $5,011 | $(169) | -3.4% | | Six Months Ended June 30, | $10,222 | $10,052 | $170 | 1.7% | - The three-month decrease was primarily due to lower personnel-related costs from decreased call center headcount, partially offset by increased third-party call center costs[120](index=120&type=chunk) - The six-month increase was mainly due to higher hosting costs, with increased third-party call center costs offset by decreased personnel costs[121](index=121&type=chunk) [Sales and Marketing](index=35&type=section&id=Sales%20and%20Marketing_MD%26A) Sales and marketing expense increased significantly for both periods, primarily driven by a substantial rise in advertising costs due to increased carrier spending. This was partially offset by decreases in office and occupancy costs and amortization Table: Sales and Marketing Expense (in thousands) | Period | 2025 | 2024 | Change | % Change | | :-------------------------- | :--------- | :--------- | :------- | :------- | | Three Months Ended June 30, | $121,055 | $90,913 | $30,142 | 33.2% | | Six Months Ended June 30, | $250,485 | $161,697 | $88,788 | 54.9% | - Advertising costs increased by **$30.4 million** for the three months and **$90.0 million** for the six months, driven by increased carrier spend[122](index=122&type=chunk)[123](index=123&type=chunk) [Research and Development](index=31&type=section&id=Research%20and%20Development_MD%26A) Research and development expense increased for both periods, primarily due to higher personnel-related costs resulting from increased headcount and consulting expenses, as the company focuses on improving its platform and developing new offerings Table: Research and Development Expense (in thousands) | Period | 2025 | 2024 | Change | % Change | | :-------------------------- | :------- | :------- | :------- | :------- | | Three Months Ended June 30, | $7,772 | $7,043 | $729 | 10.4% | | Six Months Ended June 30, | $15,257 | $13,887 | $1,370 | 9.9% | - The increase was primarily due to higher personnel-related costs from increased headcount and increased consulting expense[124](index=124&type=chunk)[125](index=125&type=chunk) [General and Administrative](index=31&type=section&id=General%20and%20Administrative_MD%26A) General and administrative expenses increased for both periods, mainly driven by higher personnel-related costs, particularly due to increased stock-based compensation, as well as higher legal and consulting fees Table: General and Administrative Expense (in thousands) | Period | 2025 | 2024 | Change | % Change | | :-------------------------- | :------- | :------- | :------- | :------- | | Three Months Ended June 30, | $8,460 | $7,881 | $579 | 7.3% | | Six Months Ended June 30, | $16,900 | $14,511 | $2,389 | 16.5% | - The increase was primarily due to higher personnel-related costs, including increased stock-based compensation (**$3.0M** vs **$2.2M** for 3M; **$5.4M** vs **$3.8M** for 6M)[126](index=126&type=chunk)[127](index=127&type=chunk) - Legal fees and consulting fees also contributed to the increase for the six-month period[127](index=127&type=chunk) [Legal Settlement](index=31&type=section&id=Legal%20Settlement_MD%26A) Legal settlement expense was recorded for the three and six months ended June 30, 2025, primarily related to the settlement of litigation concerning the 2021 PolicyFuel acquisition Table: Legal Settlement Expense (in thousands) | Period | 2025 | 2024 | | :-------------------------- | :------- | :--- | | Three Months Ended June 30, | $332 | — | | Six Months Ended June 30, | $8,232 | — | - The six-month expense included **$7.8 million** for the estimated costs to settle the litigation and **$0.4 million** in related legal expenses[128](index=128&type=chunk) [Other Income (Expense)](index=37&type=section&id=Other%20Income%20(Expense)_MD%26A) Interest income increased significantly for both periods due to higher interest earned on the company's cash balances, while other income (expense), net remained immaterial Table: Interest Income (in thousands) | Period | 2025 | 2024 | Change | % Change | | :-------------------------- | :--- | :--- | :--- | :------- | | Three Months Ended June 30, | $918 | $456 | $462 | 101.3% | | Six Months Ended June 30, | $1,626 | $842 | $784 | 93.1% | [Income Tax Expense](index=37&type=section&id=Income%20Tax%20Expense_MD%26A) Income tax expense for both periods primarily consisted of state income taxes and federal income taxes not offset by carryforwards. The company maintains a valuation allowance on its net deferred tax asset, with potential for future release based on sustained pre-tax income Table: Income Tax Expense (in thousands) | Period | 2025 | 2024 | | :-------------------------- | :--- | :--- | | Three Months Ended June 30, | $363 | $406 | | Six Months Ended June 30, | $1,047 | $692 | - Income tax expense primarily consists of state and federal income taxes not offset by operating loss and tax credit carryforwards[130](index=130&type=chunk) - A valuation allowance is maintained on the net deferred tax asset, with a potential future release if sufficient positive evidence of pre-tax income is sustained[131](index=131&type=chunk) [Liquidity and Capital Resources](index=39&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company's liquidity included $148.2 million in cash and cash equivalents. Subsequent to the period, a new $60.0 million senior secured revolving credit facility was established, and a $50.0 million share repurchase program was authorized. The company believes existing liquidity is sufficient for the next 12 months - Principal sources of liquidity as of **June 30, 2025**, were **$148.2 million** in cash and cash equivalents[133](index=133&type=chunk) - A new **$60.0 million** senior secured revolving credit facility was entered into on **August 1, 2025**, with an option for an additional **$25.0 million**[133](index=133&type=chunk) - A **$50.0 million** share repurchase program for Class A common stock was authorized on **July 22, 2025**, for one year[136](index=136&type=chunk) - The company believes its existing cash and cash equivalents are sufficient to fund operating expenses and capital expenditure requirements for at least the next **12 months**[137](index=137&type=chunk) [Cash Flows](index=40&type=section&id=Cash%20Flows) Net cash provided by operating activities more than doubled for the six months ended June 30, 2025, driven by net income and non-cash adjustments. Investing activities continued to use cash for property and equipment, while financing activities provided a minimal net cash inflow Table: Summary of Cash Flows (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :------------------------------------ | :------------------------------- | :------------------------------- | | Net cash provided by operating activities | $48,603 | $22,818 | | Net cash used in investing activities | $(2,594) | $(1,622) | | Net cash provided by financing activities | $56 | $1,771 | | Net increase in cash, cash equivalents and restricted cash | $46,072 | $22,963 | - Operating cash flow increased significantly, primarily due to net income of **$22.7 million** and **$22.1 million** in non-cash charges, including a **$7.8 million** litigation accrual[139](index=139&type=chunk) - Investing activities used cash primarily for the acquisition of property and equipment, including **$2.3 million** in capitalized software development costs for the six months ended **June 30, 2025**[141](index=141&type=chunk) [Contractual Obligations and Commitments](index=42&type=section&id=Contractual%20Obligations%20and%20Commitments) The company entered into a new five-year, $18.5 million advertising purchase commitment in June 2025, with $3.0 million due in the next twelve months. No other material changes to contractual obligations were reported since the last Annual Report on Form 10-K - A new **five-year, $18.5 million** advertising purchase commitment was made in **June 2025**, with **$3.0 million** due within the next twelve months[144](index=144&type=chunk) [Critical Accounting Policies and Significant Judgments and Estimates](index=42&type=section&id=Critical%20Accounting%20Policies%20and%20Significant%20Judgments%20and%20Estimates) There have been no material changes to the company's critical accounting policies from those disclosed in its Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to critical accounting policies were reported from the Annual Report on Form 10-K for the year ended **December 31, 2024**[146](index=146&type=chunk) [Recently Issued Accounting Pronouncements](index=42&type=section&id=Recently%20Issued%20Accounting%20Pronouncements_MD%26A) Information regarding recently issued accounting pronouncements is disclosed in Note 2 to the unaudited condensed consolidated financial statements - Refer to **Note 2** for a description of recently issued accounting pronouncements and their potential impact[147](index=147&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=42&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's exposure to market risk is primarily related to interest rates and foreign currency exchange rates. As of June 30, 2025, there was no material exposure to interest rate fluctuations due to no outstanding borrowings, and foreign currency exposure was deemed immaterial - The company had **no material exposure** to interest rate fluctuations as of **June 30, 2025**, due to no outstanding borrowings under its revolving line of credit[148](index=148&type=chunk) - Exposure to adverse changes in foreign currency exchange rates from foreign transactions and subsidiaries is believed to be immaterial, and the company does not hedge against this exposure[149](index=149&type=chunk) [Item 4. Controls and Procedures](index=42&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective at a reasonable assurance level as of June 30, 2025. There were no material changes in internal control over financial reporting during the three months ended June 30, 2025 - Disclosure controls and procedures were evaluated and deemed **effective** at the reasonable assurance level as of **June 30, 2025**[150](index=150&type=chunk)[152](index=152&type=chunk) - No material changes in internal control over financial reporting occurred during the three months ended **June 30, 2025**[153](index=153&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=44&type=section&id=Item%201.%20Legal%20Proceedings) Information regarding legal proceedings is incorporated by reference from Note 8 of the Notes to the Unaudited Condensed Consolidated Financial Statements - Details on legal proceedings are provided in **Note 8** of the Condensed Consolidated Financial Statements[155](index=155&type=chunk) [Item 1A. Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) This section updates risk factors, highlighting potential impacts of operating result fluctuations on the recently announced share repurchase program and the adverse effects that indebtedness under the new credit agreement could have on business operations and financial condition - Fluctuations in operating results could hinder the company's ability to repurchase shares under its **$50.0 million** share repurchase program[157](index=157&type=chunk) - Indebtedness under the new **$60.0 million** revolving credit facility could adversely affect the company's ability to operate, financial condition, and results of operations, including reducing cash for operations and increasing vulnerability to economic changes[158](index=158&type=chunk)[159](index=159&type=chunk)[160](index=160&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=46&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) There were no unregistered sales or issuances of equity securities, nor any issuer purchases of registered equity securities, during the three months ended June 30, 2025 - No shares of equity securities were sold or issued without registration under the Securities Act during the three months ended **June 30, 2025**[161](index=161&type=chunk) - The company did not purchase any of its registered equity securities during the period from **April 1, 2025**, to **June 30, 2025**[162](index=162&type=chunk) [Item 5. Other Information](index=46&type=section&id=Item%205.%20Other%20Information) This section discloses the adoption of Rule 10b5-1 trading plans by two board members, George Neble and Mira Wilczek, for the sale of company securities - Board members **George Neble** and **Mira Wilczek** adopted Rule 10b5-1 trading plans in **May 2025** for the sale of company securities[163](index=163&type=chunk) - Mr. Neble's plan involves an indeterminable number of shares from RSU settlements, while Ms. Wilczek's plan is for up to **15,000 shares**[163](index=163&type=chunk) [Item 6. Exhibits](index=47&type=section&id=Item%206.%20Exhibits) This item lists the exhibits filed with the Quarterly Report on Form 10-Q, including agreements related to the PolicyFuel settlement, loan modifications, and certifications by the CEO and CFO - Key exhibits include the Purchase and Sale Agreement (**May 1, 2025**), Loan and Security Modification Agreement (**May 1, 2025**), and certifications from the CEO and CFO[165](index=165&type=chunk) [Signatures](index=48&type=section&id=Signatures) The Quarterly Report on Form 10-Q was duly signed on behalf of EverQuote, Inc. by its Chief Executive Officer and President, Jayme Mendal, and its Chief Financial Officer and Treasurer, Joseph Sanborn, on August 4, 2025 - The report was signed by **Jayme Mendal** (CEO and President) and **Joseph Sanborn** (CFO and Treasurer) on **August 4, 2025**[171](index=171&type=chunk)

Core Insights - EverQuote reported revenue of $156.63 million for the quarter ended June 2025, reflecting a year-over-year increase of 33.7% [1] - The company's EPS was $0.39, up from $0.17 in the same quarter last year, indicating a significant improvement [1] - Revenue fell short of the Zacks Consensus Estimate of $157.66 million by 0.66%, while EPS exceeded the consensus estimate of $0.35 by 11.43% [1] Financial Performance Metrics - Variable Marketing Dollars were reported at $45.52 million, slightly below the estimated $46.13 million [4] - Automotive revenue reached $139.58 million, surpassing the average estimate of $138.6 million, with a year-over-year growth of 36% [4] - Home and Renters revenue was $17.03 million, exceeding the average estimate of $15.88 million, representing a year-over-year increase of 22.7% [4] - Revenue from Other categories was reported at $0.01 million, matching the average estimate but showing a drastic year-over-year decline of 98.3% [4] Stock Performance - Over the past month, EverQuote's shares have returned -1.8%, contrasting with the Zacks S&P 500 composite's increase of 0.6% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Group 1: Earnings Performance - EverQuote reported quarterly earnings of $0.39 per share, exceeding the Zacks Consensus Estimate of $0.35 per share, and up from $0.17 per share a year ago, representing an earnings surprise of +11.43% [1] - Over the last four quarters, EverQuote has surpassed consensus EPS estimates four times [2] - The company posted revenues of $156.63 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 0.66%, compared to year-ago revenues of $117.14 million [2] Group 2: Stock Performance and Outlook - EverQuote shares have increased approximately 20.6% since the beginning of the year, outperforming the S&P 500's gain of 6.1% [3] - The company's earnings outlook, including current consensus earnings expectations for upcoming quarters, will be crucial for investors [4] - The current consensus EPS estimate for the coming quarter is $0.32 on revenues of $164.49 million, and $1.18 on revenues of $644.08 million for the current fiscal year [7] Group 3: Industry Context - The Insurance - Multi line industry, to which EverQuote belongs, is currently in the top 35% of over 250 Zacks industries, indicating a favorable outlook [8] - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact stock performance [5] - Assurant, another company in the same industry, is expected to report quarterly earnings of $4.43 per share, reflecting a year-over-year change of +8.6% [9]

EverQuote (EVER) Q2 2025 Earnings Call August 04, 2025 04:30 PM ET Company ParticipantsBrinlea Johnson - Managing Partner and Co-Head of East CoastJayme Mendal - CEO & Board MemberJoseph Sanborn - CFOCory Carpenter - Internet Equity ResearchMitchell Rubin - Equity Research AssociateConference Call ParticipantsMaria Ripps - MD & Senior Research AnalystZach Cummins - Senior Research AnalystJason Kreyer - Senior Research AnalystRalph Schackart - Research Analyst - Technology, Media and CommunicationsMayank Tan ...

Financial Data and Key Metrics Changes - Total revenues in Q2 grew 34% year over year to $156.6 million, driven by stronger enterprise carrier spend, which was up over 61% from the comparable period last year [12][13] - Net income reached a record $14.7 million, up from $6.4 million in the prior year period [14] - Adjusted EBITDA increased to $22 million compared to $12.9 million in the prior year period, with an adjusted EBITDA margin expanding to a record 14% [14][18] - Operating cash flow was reported at a record $25.3 million for the second quarter, with cash and cash equivalents increasing to $148.2 million from $125 million at the end of Q1 [14][17] Business Line Data and Key Metrics Changes - Revenue from the auto insurance vertical increased to $139.6 million in Q2, up 36% year over year [12] - Revenue from the home and renters insurance vertical increased to $17 million in Q2, up 23% both year over year and sequentially [13] - Variable marketing dollars (VMD) increased to $45.5 million in Q2, up 25% from the prior year period, with a variable marketing margin (VMM) of 29.1%, up from 28% in Q1 [13] Market Data and Key Metrics Changes - Carrier demand remained stable, with one large carrier increasing spend to record levels while another tightened budgets [5][6] - The company anticipates a return to a full carrier panel by historical standards by the end of the year, despite challenges in certain geographies like California [6][34] Company Strategy and Development Direction - The company aims to become the number one growth partner to property and casualty (P&C) insurance providers by delivering better-performing referrals and a broader suite of products and services [5][11] - Investments are being made in AI capabilities and technology to drive operational efficiency and strengthen competitive positioning [17][18] - The company plans to exceed $1 billion in annual revenue in the near future, focusing on organic growth and expanding its existing customer base [11][66] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the healthy carrier landscape and stable demand, indicating no anticipated budget constraints in the second half of the year [22][23] - The company is focused on increasing operating efficiency and productivity, evidenced by record adjusted EBITDA margins and net income [9][10] - Future guidance expects revenue between $163 million and $169 million, representing 15% year-over-year growth at the midpoint [18] Other Important Information - The company announced a share repurchase program authorized for up to $50 million over the next twelve months, reflecting confidence in the business [15] - A new three-year $60 million committed credit facility was established to provide additional financial flexibility [17] Q&A Session Summary Question: Impact of tariffs on carrier profitability - Management indicated that the carrier landscape remains healthy, with stable demand and no anticipated budget constraints despite monitoring tariffs [22][23] Question: AI-powered search impact on traffic acquisition - Management acknowledged that while the insurance industry is more opaque, they are well-positioned to engage with AI-driven traffic acquisition strategies [24][25] Question: Competitive pressures in the advertising landscape - Management noted increased competitive pressure from carriers stepping into the advertising market but emphasized their ability to manage through it effectively [46] Question: M&A considerations - Management stated that while they are open to M&A opportunities, their primary focus remains on organic growth and helping existing customers succeed [41][75] Question: Seasonal trends in revenue and VMD - Management provided guidance on expected seasonal trends, indicating a typical low single-digit decline from Q3 to Q4 [62]

Core Insights - EverQuote reported Q2 2025 results with GAAP EPS of $0.39, exceeding estimates of $0.35, while GAAP revenue was $156.6 million, slightly below the consensus of $157.2 million, indicating strong profitability and operational efficiency despite moderating growth rates [1][2] Financial Performance - GAAP EPS increased by 129.4% year-over-year from $0.17 in Q2 2024 [2] - GAAP revenue rose by 33.8% from $117.1 million in Q2 2024 [2] - Adjusted EBITDA reached $22.0 million, a 70.5% increase from $12.9 million in Q2 2024 [2] - Operating cash flow hit a record $25.3 million, more than doubling from $12.4 million in the previous year [2] Business Model and Strategy - EverQuote operates a digital marketplace that connects insurance shoppers with providers, leveraging a proprietary technology platform that utilizes AI and machine learning for optimized matching [3][4] - The company focuses on enhancing its Smart Campaigns product and expanding its offerings in the property and casualty insurance market, particularly in automotive, home, and renters' segments [4] Growth Drivers - The automotive insurance vertical was the primary growth driver, with revenue increasing by 36% to $139.6 million from $102.6 million in Q2 2024 [5] - Home and renters insurance also saw a 22.7% increase to $17.0 million [5] - The company achieved significant operational leverage, with adjusted EBITDA climbing to $22.0 million, a 69.8% increase [6] Market Trends and Outlook - Management anticipates revenue for Q3 2025 to be between $163.0 million and $169.0 million, reflecting a deceleration in growth compared to Q2 2025 [9] - Variable marketing dollars are projected to be between $47.0 million and $50.0 million, with adjusted EBITDA expected to range from $22.0 million to $24.0 million [9] - The company announced a $50.0 million share repurchase program, indicating confidence in its cash generation and balance sheet [10]

Company Overview - The company operates a leading online insurance marketplace, connecting consumers and insurance providers[10] - The company's platform leverages over 4 billion consumer data points[15,22] - The company has diversified distribution model with approximately 60 carriers and 6,000 third-party agents[15] Market Opportunity - The total P&C distribution and advertising spend market is estimated at $117 billion annually[10,17] - Digital advertising spend within the P&C insurance market is $7 billion[17] - The company estimates its share of the P&C distribution and advertising spend market is less than 1%[18] - The estimated digital advertising spend growth in the U S P&C insurance market is approximately 15% annually from 2023 to 2026[18] Financial Performance - The company's Q2 2025 revenue increased by 34% year-over-year to $156 6 million[32,43] - Auto insurance revenue in Q2 2025 grew by 36% year-over-year to $139 6 million[43] - Home/Renters insurance revenue in Q2 2025 increased by 23% year-over-year to $17 0 million[43] - Adjusted EBITDA for Q2 2025 was $22 0 million, representing a 70% increase year-over-year[32]

Core Viewpoint - EverQuote, Inc. reported strong financial results for the second quarter of 2025, with a 34% year-over-year revenue growth and record operating cash flow, indicating effective execution and a stable market environment [2][6][7]. Financial Performance - Revenue for the second quarter reached $156.6 million, a 34% increase compared to $117.1 million in the same quarter of 2024 [6][7]. - The automotive insurance vertical generated $139.6 million, reflecting a 36% increase, while home and renters insurance revenue was $17.0 million, up 23% [7][23]. - Variable marketing dollars increased by 25% year-over-year to $45.5 million [6][7]. - Net income for the quarter was $14.7 million, compared to $6.4 million in the prior year, marking a 129.6% increase [6][7][24]. - Adjusted EBITDA rose to $22.0 million, up from $12.9 million, representing a 69.8% increase [6][7][24]. Share Repurchase Program - The Board of Directors approved a share repurchase program allowing the company to buy back up to $50 million of its Class A common stock [2][5][6]. - The program is set to expire on July 22, 2026, and will be funded through existing cash balances and future cash flow [5][6]. Cash Flow and Balance Sheet - Operating cash flow reached a record $25.3 million, compared to $12.4 million in the previous year [6][7]. - The company ended the quarter with $148.2 million in cash and cash equivalents, a 19% increase from $125.0 million at the end of the first quarter of 2025 [7][18]. Future Outlook - For the third quarter of 2025, EverQuote expects revenue between $163.0 million and $169.0 million, indicating a 15% year-over-year growth at the midpoint [7][8]. - Variable marketing dollars are projected to be between $47.0 million and $50.0 million, reflecting a 10% year-over-year growth at the midpoint [7][8].

Exhibit 99.1 EverQuote Announces Second Quarter 2025 Financial Results CAMBRIDGE, Mass., August 4, 2025 (GLOBE NEWSWIRE) -- EverQuote, Inc. (Nasdaq: EVER), a leading online insurance marketplace, today announced financial results for the second quarter ended June 30, 2025. "We achieved strong results in the second quarter, growing revenue 34% year-over-year and achieving record operating cash flow," said Jayme Mendal, CEO of EverQuote. "Our team is executing well against an increasingly stable backdrop with ...

Group 1 - EverQuote has shown impressive growth primarily in the car insurance market and with a few large customers [1] - The property and casualty (P&C) market is cyclical, prompting the company to seek diversification [1] Group 2 - The company emphasizes a data-oriented approach to analyze investment opportunities [1]