NerdWallet(NRDS) - 2022 Q2 - Quarterly Report

Revenue Performance - Revenue for the three months ended June 30, 2022, was $125.2 million, a 37% increase from$ 91.6 million in the same period of 2021[71]. - Credit card revenue increased by $24.7 million, or 82%, for the three months ended June 30, 2022, driven by improved user experiences[72]. - Loans revenue decreased by$ 8.3 million, or 26%, for the three months ended June 30, 2022, primarily due to a 55% drop in mortgages revenue[73]. - Other verticals revenue increased by $17.2 million, or 58%, for the three months ended June 30, 2022, with significant growth in SMB products revenue[74]. User Metrics - Monthly Unique Users (MUUs) averaged 20 million for the three months ended June 30, 2022, a 2% increase compared to the same period in 2021[60]. - The company expects MUUs to grow over time, although fluctuations may occur due to macroeconomic conditions and consumer behavior trends[60]. Expenses and Costs - Total costs and expenses for the three months ended June 30, 2022, were$ 134.2 million, up from $114.3 million in the same period of 2021[69]. - Cost of revenue increased by$ 0.9 million, or 12%, for the three months ended June 30, 2022, and by $2.1 million, or 15%, for the six months ended June 30, 2022, compared to the same periods in 2021[76]. - Research and development expenses rose by$ 5.3 million, or 36%, for the three months ended June 30, 2022, and by $10.5 million, or 39%, for the six months ended June 30, 2022, primarily due to increased personnel-related costs[77]. - Sales and marketing expenses increased by$ 6.2 million, or 8%, for the three months ended June 30, 2022, and by $33.7 million, or 22%, for the six months ended June 30, 2022, mainly driven by higher performance marketing expenses[79]. - General and administrative expenses surged by$ 6.4 million, or 72%, for the three months ended June 30, 2022, and by $10.6 million, or 59%, for the six months ended June 30, 2022, largely due to increased personnel-related costs and acquisition-related expenses[80]. - Total costs and expenses increased by$ 19.9 million, or 17%, for the three months ended June 30, 2022, and by $54.9 million, or 25%, for the six months ended June 30, 2022, compared to the same periods in 2021[75]. Profitability and Loss - Net loss for the three months ended June 30, 2022, was$ 9.3 million, a decrease of $4.6 million or 33% compared to the same period in 2021[70]. - Adjusted EBITDA is used alongside GAAP measures to assess performance and was impacted by increased revenue and expenses[64]. - Adjusted EBITDA increased by$ 12.7 million for the three months ended June 30, 2022, and by $21.6 million for the six months ended June 30, 2022, compared to the same periods in 2021[85]. Cash Flow and Liquidity - Cash and cash equivalents were$ 125.8 million as of June 30, 2022, down from $167.8 million as of December 31, 2021[89]. - Net cash used in operating activities decreased by$ 3.7 million to $14.4 million for the six months ended June 30, 2022, compared to$ 18.1 million for the same period in 2021[97]. - Net cash used in investing activities increased by $5.1 million to$ 15.9 million for the six months ended June 30, 2022, primarily due to a $2.5 million increase in property and equipment purchases and a$ 2.6 million increase in capitalized software development costs[98]. - Net cash used in financing activities decreased by $2.0 million to$ 11.5 million for the six months ended June 30, 2022, compared to $13.5 million for the same period in 2021[99]. - The company experienced a net decrease in cash and cash equivalents of$ 42.0 million for the six months ended June 30, 2022, compared to a decrease of $42.3 million for the same period in 2021[96]. - The company anticipates significant investments in personnel and related expenses to support growth, which may impact liquidity and cash flows[93]. - The company may seek additional capital resources through equity sales or debt financing to support future growth and acquisitions[95]. Acquisition and Investments - The company completed the acquisition of On the Barrelhead, Inc. for approximately$ 70 million in cash and 4.9 million shares of Class A common stock[58]. - As of June 30, 2022, the company had no outstanding balance on its credit facility and had borrowed $70 million to finance the acquisition of OTB[94]. Tax and Compliance - The effective tax rate for the three and six months ended June 30, 2022, was (1.8%) and (7.7%), respectively, compared to 36.4% and 24.2% for the same periods in 2021[83]. - The company was in compliance with all covenants of its credit facility as of June 30, 2022[94]. - There were no material changes in critical accounting policies during the six months ended June 30, 2022[101]. Market Risks - The company is exposed to market risks primarily due to fluctuations in interest rates and foreign currency exchange rates[103]. - The company maintains effective disclosure controls and procedures as of June 30, 2022[105].