LegalZoom.com(LZ) - 2024 Q3 - Quarterly Results

Financial Performance - Third quarter revenue was $168.6 million, a 1% increase year-over-year, with subscription revenue at $110.7 million, growing 5% year-over-year[3] - Net income for the quarter reached $11.1 million, representing 7% of revenue, compared to $7.5 million, or 5% of revenue, in the same period last year[3] - Adjusted EBITDA was $47.1 million, or 28% of revenue, up from $33.7 million, or 20% of revenue, year-over-year[3] - Gross profit for the same period was $113.9 million, up from $108.1 million in 2023, indicating a gross profit margin improvement[14] - Net income for the three months ended September 30, 2024, was $11.1 million, compared to $7.5 million in 2023, reflecting a year-over-year increase of 47%[14] - Adjusted EBITDA for the three months ended September 30, 2024, was $47.1 million, an increase from $33.7 million in 2023, resulting in an adjusted EBITDA margin of 28%[16] - Non-GAAP net income for Q3 2024 was $29,699,000, up 27.8% from $23,308,000 in Q3 2023[17] - Non-GAAP net income margin increased to 18% in Q3 2024, compared to 14% in Q3 2023[17] - Total net income for the nine months ended September 30, 2024, was $17,109,000, compared to $6,571,000 for the same period in 2023[17] Cash Flow and Assets - Cash flow from operating activities was $31.6 million, an increase of 15% compared to $27.4 million in the same period last year[4] - Free cash flow for the quarter was $22.0 million, compared to $19.4 million in the same period last year, reflecting a 13% increase[4] - Free cash flow for Q3 2024 was $21,975,000, a 12.8% increase from $19,448,000 in Q3 2023[19] - Net cash provided by operating activities for Q3 2024 was $31,613,000, compared to $27,441,000 in Q3 2023[19] - Free cash flow for the nine months ended September 30, 2024, was $93.1 million, down from $101.8 million in the same period of 2023[15] - The company’s cash and cash equivalents decreased to $112.5 million as of September 30, 2024, from $225.7 million at the end of 2023, indicating a significant cash outflow[15] Shareholder Actions - The company repurchased 3.8 million shares for $24.7 million, reducing outstanding shares by 2%[3] Future Guidance - For Q4 2024, revenue is expected to be between $158 million and $162 million, with adjusted EBITDA projected between $40 million and $44 million[5] - Full-year revenue guidance is updated to a range of $678 million to $682 million, with adjusted EBITDA expected between $144 million and $148 million[5] Subscription Metrics - Subscription units increased by 10% year-over-year, reaching 1,717 at the end of the period[4] - The company achieved a 300 basis point increase in subscription revenue mix year-over-year, indicating progress in its subscription business initiatives[1] Operating Expenses - LegalZoom's operating expenses remained stable at $97.6 million for the three months ended September 30, 2024, compared to $97.8 million in 2023, reflecting effective cost management[14] - Restructuring costs for Q3 2024 amounted to $5,917,000, significantly higher than $68,000 in Q3 2023[17] - Purchase of property and equipment for Q3 2024 was $9,638,000, compared to $7,993,000 in Q3 2023[19] Liabilities and Assets - Total current assets decreased to $167.2 million as of September 30, 2024, from $275.3 million at the end of 2023, primarily due to a reduction in cash and cash equivalents[13] - Total liabilities increased to $288.7 million as of September 30, 2024, compared to $279.0 million at the end of 2023, driven by higher deferred revenue[13]