SAN FRANCISCO--(BUSINESS WIRE)--NerdWallet Is Giving Away $2.5 Million This December. ...

NerdWallet, Inc. (NRDS) appears an attractive pick given a noticeable improvement in the company's earnings outlook. The stock has been a strong performer lately, and the momentum might continue with analysts still raising their earnings estimates for the company.The upward trend in estimate revisions for this company reflects growing optimism of analysts on its earnings prospects, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earni ...

Core Insights - NerdWallet, Inc. reported revenue of $215.1 million for the quarter ended September 2025, reflecting a year-over-year increase of 12.4% [1] - The earnings per share (EPS) for the quarter was $0.34, a significant improvement from $0 in the same quarter last year [1] - The reported revenue exceeded the Zacks Consensus Estimate of $193.1 million by 11.4%, while the EPS surpassed the consensus estimate of $0.20 by 70% [1] Revenue Breakdown - Revenue from Insurance was $70.9 million, exceeding the average analyst estimate of $64.82 million [4] - Revenue from Credit Cards was $34.1 million, slightly below the average estimate of $35.18 million [4] - Revenue from Emerging Verticals reached $46.9 million, significantly higher than the estimated $36.45 million [4] - Revenue from Loans was $39.6 million, surpassing the average estimate of $29.52 million [4] - Revenue from SMB Products was $23.6 million, falling short of the estimated $27 million [4] Stock Performance - Over the past month, shares of NerdWallet, Inc. have returned +13.8%, outperforming the Zacks S&P 500 composite's +1.3% change [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Core Insights - NerdWallet, Inc. reported quarterly earnings of $0.34 per share, exceeding the Zacks Consensus Estimate of $0.20 per share, and compared to break-even earnings per share a year ago, representing an earnings surprise of +70.00% [1] - The company posted revenues of $215.1 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 11.40%, and showing an increase from year-ago revenues of $191.3 million [2] - NerdWallet, Inc. shares have declined approximately 9.5% year-to-date, while the S&P 500 has gained 15.6% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.15 on revenues of $195.11 million, and for the current fiscal year, it is $0.47 on revenues of $784.32 million [7] - The estimate revisions trend for NerdWallet, Inc. was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Industry Context - The Financial - Miscellaneous Services industry, to which NerdWallet belongs, is currently ranked in the top 35% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial guidance platform NerdWallet (NASDAQ:NRDS) announced better-than-expected revenue in Q3 CY2025, with sales up 12.4% year on year to $215.1 million. Its non-GAAP profit of $0.34 per share was 7.3% above analysts’ consensus estimates. Is now the time to buy NerdWallet? Find out in our full research report. NerdWallet (NRDS) Q3 CY2025 Highlights: Revenue: $215.1 million vs analyst estimates of $193.2 million (12.4% year-on-year growth, 11.3% beat)Pre-tax Profit: $35.5 million (16.5% margin)Adjus ...

Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $215 million, representing a 12% year-over-year increase, exceeding the guidance range of $189-$197 million [7] - Non-GAAP operating income for Q3 was $41 million, above the guidance range of $23 million-$27 million [8] - GAAP operating income for Q3 was $34 million, with trailing 12-month adjusted free cash flow increasing and a cash balance of $121 million at the end of Q3 [8][9] Business Line Data and Key Metrics Changes - Banking revenue increased by 96% year-over-year, while personal loans revenue rose by 91% year-over-year [7] - The insurance business saw a 3% year-over-year increase, slightly better than expected [7] - SMB products and credit cards experienced a decline year-over-year due to organic search headwinds [7] Market Data and Key Metrics Changes - The company is seeing momentum with referrals from large language models (LLMs), which convert at a higher rate than traditional organic traffic [5] - Traffic from LLMs is currently small but shows potential for growth, prompting continued investment in this channel [5] Company Strategy and Development Direction - The company aims to expand its reach to below-prime consumers, enhancing its product offerings and operational efficiency [4][6] - There is a focus on converting traffic into a loyal audience through personalized engagement strategies [6] - The company plans to return to typical levels of brand marketing spend in Q4 after reevaluating its brand strategy [8][20] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in long-term prospects, emphasizing sustainable growth, strong free cash flow generation, and disciplined capital allocation [7] - For Q4, the company expects revenue in the range of $207 million-$250 million, with continued strength in banking and personal loans, but challenges in credit cards and SMB [9][10] - Non-GAAP operating income for Q4 is expected to be between $20 million and $24 million, reflecting improvements in shopping funnels and operational efficiency [10] Other Important Information - The company completed $19 million in share repurchases during the quarter, reflecting confidence in long-term prospects [9] - Management noted that the brand is a significant asset and is continuously looking for ways to enhance its impact [20] Q&A Session Summary Question: Insights on LLM traffic growth and investments - Management indicated that LLM traffic is converting at stronger rates and investments are similar to those made for organic search [12][14] Question: Drivers of banking category growth - The increase in banking demand is attributed to both consumer and partner demand, with improvements in product funnels to match user intent [16][18] Question: Reevaluation of brand spend - The company underspent on brand marketing by $8 million in Q3 due to a reevaluation of its brand strategy, with plans to return to typical spending levels in Q4 [19][20] Question: Content strategy for below-prime consumers - The company has historically had content for all consumers, and the focus is on filling out the marketplace to better serve unmet needs [21][22]

Revenue Growth - Revenue for the three months ended September 30, 2025, increased by $23.8 million, or 12%, to $215.1 million compared to the same period in 2024[78] - Revenue for the nine months ended September 30, 2025, increased by $107.4 million, or 21%, to $611.2 million compared to the same period in 2024[78] - Emerging verticals revenue increased significantly, contributing to overall revenue growth, with a 83% increase for the three months ended September 30, 2025[78] - Loans revenue increased by $15.8 million, or 66%, and $24.2 million, or 36%, for the three and nine months ended September 30, 2025, primarily due to increases of 91% in personal loans revenue[83] - Emerging verticals revenue rose by $21.2 million, or 83%, and $44.5 million, or 49%, for the three and nine months ended September 30, 2025, driven by a 96% increase in banking revenue[84] - Insurance revenue increased by $2.2 million, or 3%, for the three months ended September 30, 2025, and by $80.0 million, or 67%, for the nine months ended September 30, 2025[79] - Credit cards revenue decreased by $11.2 million, or 25%, for the three months ended September 30, 2025, and by $34.5 million, or 24%, for the nine months ended September 30, 2025[81] - SMB products revenue decreased by $4.2 million, or 15%, for the three months ended September 30, 2025, and by $6.8 million, or 8%, for the nine months ended September 30, 2025[82] Net Income and Operating Income - Net income for the three months ended September 30, 2025, was $26.3 million, compared to a net income of $0.1 million for the same period in 2024[77] - Net income for the nine months ended September 30, 2025, was $34.7 million, compared to a net loss of $8.2 million for the same period in 2024[77] - Non-GAAP operating income for the three months ended September 30, 2025, increased by $27.8 million, or 420%, compared to the same period in 2024[76] - Non-GAAP operating income for the nine months ended September 30, 2025, increased by $45.1 million compared to the same period in 2024[76] - Non-GAAP operating income increased by $18.4 million, or 81%, and $40.5 million, or 132%, for the three and nine months ended September 30, 2025, compared to the same periods in 2024[101] Expenses - Total costs and expenses decreased by $4.0 million, or 2%, for the three months ended September 30, 2025, but increased by $62.3 million, or 12%, for the nine months ended September 30, 2025[85] - Research and development expenses decreased by $7.3 million, or 31%, and $16.0 million, or 24%, for the three and nine months ended September 30, 2025, compared to the same periods in 2024[87] - Sales and marketing expenses increased by $7.2 million, or 6%, and $80.9 million, or 24%, for the three and nine months ended September 30, 2025, primarily due to increases in performance marketing expenses[89] - General and administrative expenses decreased by $1.5 million, or 10%, and $5.9 million, or 12%, for the three and nine months ended September 30, 2025, compared to the same periods in 2024[90] Tax and EBITDA - The effective tax rate was 25.8% and 28.1% for the three and nine months ended September 30, 2025, compared to 99.2% and 290.7% for the same periods in 2024[95] - Adjusted EBITDA for the three and nine months ended September 30, 2025, was $53.6 million and $108.3 million, respectively, with adjusted EBITDA margins of 25% and 18%[99] - Adjusted EBITDA increased by $16.3 million, or 44%, for the three months ended September 30, 2025, and by $31.2 million, or 41%, for the nine months ended September 30, 2025, compared to the same periods in 2024[103] Cash Flow and Liquidity - Cash and cash equivalents rose to $120.6 million as of September 30, 2025, up from $66.3 million as of December 31, 2024[105] - Net cash provided by operating activities increased by $30.8 million for the nine months ended September 30, 2025, driven by a net income of $34.7 million compared to a net loss of $8.2 million in the same period of 2024[115] - Net cash used in investing activities decreased by $4.0 million for the nine months ended September 30, 2025, primarily due to a reduction in purchases of investments and capitalized software development costs[116] - Net cash used in financing activities decreased by $48.6 million for the nine months ended September 30, 2025, mainly due to a $50.3 million decrease in repurchases of Class A common stock[117] - The company repurchased 1.8 million shares of Class A common stock for $19.2 million during the nine months ended September 30, 2025[109] - The company maintains a $125.0 million senior secured revolving credit facility, with no outstanding balance as of September 30, 2025[110] - The company expects to fund operations and capital expenditures primarily with cash flows from operations, supplemented by cash on hand if needed[108] - The company had $5.8 million outstanding under a $15.0 million warehouse line of credit as of September 30, 2025[111] - The company anticipates that its current cash and cash equivalents, along with future cash flow from operations, will be sufficient to meet ongoing liquidity requirements for the next twelve months and beyond[112]

Financial Performance - Revenue for Q3 2025 was $215.1 million, representing a 12% increase year-over-year[5] - GAAP net income for Q3 2025 was $26.3 million, or $0.34 per diluted share, compared to $0.1 million in Q3 2024[5] - Non-GAAP operating income increased by 81% year-over-year to $41.3 million in Q3 2025[5] - Loans revenue surged by 66% year-over-year to $39.6 million, driven by growth in personal and mortgage loans[6] - Emerging verticals revenue grew by 83% year-over-year to $46.9 million, primarily due to banking product growth[6] - Insurance revenue increased by 3% year-over-year to $70.9 million[6] - Credit cards revenue decreased by 25% year-over-year to $34.1 million, impacted by headwinds in organic search traffic[6] - Net income for the nine months ended September 30, 2025, was $34.7 million, compared to a net loss of $8.2 million in the same period of 2024[17] - Non-GAAP operating income for the nine months ended September 30, 2025, was $71.3 million, representing a 132% increase compared to $30.8 million in 2024[26] - Adjusted EBITDA for the nine months ended September 30, 2025, was $108.3 million, a 41% increase from $77.1 million in 2024[26] - The company reported a significant increase in income from operations, reaching $45.8 million for the nine months ended September 30, 2025, compared to $0.7 million in 2024[26] Cash and Assets - Cash and cash equivalents rose by 68% year-over-year to $120.6 million[7] - Total assets increased to $492.8 million as of September 30, 2025, up from $437.6 million at the end of 2024[16] - Cash and cash equivalents at the end of the period increased to $120.6 million from $71.7 million in the previous year[17] Forecasts and Projections - The forecasted 2025 annual GAAP operating income is projected to be in the range of $59-$63 million, with non-GAAP operating income expected to be between $91-$95 million[29] - The forecasted adjusted EBITDA for 2025 is expected to be in the range of $141-$145 million[29] - Revenue is expected to be in the range of $207-$215 million, representing a 15% year-over-year increase at the midpoint[32] - GAAP operating income is projected to be between $13 million and $17 million for Q4 2025[31] - Non-GAAP operating income is anticipated to be in the range of $20 million to $24 million for Q4 2025[31] - Adjusted EBITDA is expected to be between $33 million and $37 million[32] - Full year 2025 GAAP operating income is forecasted to be between $59 million and $63 million[31] - Full year 2025 non-GAAP operating income is projected to be in the range of $91 million to $95 million[31] Marketing and Spending - The company underspent on brand marketing by $8 million in Q3 2025, with plans to return to typical spending levels in Q4[6] - Stock-based compensation decreased to $21.6 million for the nine months ended September 30, 2025, down 22% from $27.7 million in 2024[26] Risks and Strategic Focus - The company faces significant risks and uncertainties that may affect actual results compared to forward-looking statements[34] - The company aims to grow traffic, engagement, and monetization on its platform while expanding within existing and new verticals[37] - The company is focused on developing scalable technology and enhancing user engagement through personalized guidance[37]

Core Viewpoint - NerdWallet has announced a conference call to review its financial results for the third quarter of 2025, indicating a focus on transparency and communication with stakeholders [1] Financial Results - The conference call will provide insights into the company's financial performance for the third quarter of 2025, which is crucial for investors and analysts to assess the company's growth and profitability [1]

Group 1 - The stock market is experiencing volatility at all-time highs, suggesting a need for portfolio rotation strategies ahead of 2026 [1] - A recommendation is made to shift portfolios into reasonably priced technology companies, reflecting the analyst's extensive experience in the sector [1] Group 2 - The analyst, Gary Alexander, has a background in covering technology companies on Wall Street and has worked in Silicon Valley, providing insights into current industry trends [1] - Alexander has been a contributor to Seeking Alpha since 2017 and has been featured in various web publications, indicating a strong presence in the investment community [1]