LendingTree(TREE) - 2025 Q2 - Quarterly Results

Preliminary Q2 2025 Results and Revised 2025 Guidance LendingTree announced strong preliminary Q2 2025 financial results, exceeding prior guidance and leading to a raised full-year 2025 outlook Executive Summary LendingTree announced strong preliminary Q2 2025 financial results, exceeding prior guidance with double-digit revenue growth across all segments, improved capital position, and a raised full-year 2025 outlook - All three business segments produced double-digit year-over-year revenue growth in the second quarter[2] - The company's capital position has improved significantly, with net leverage falling to 3x at the end of the second quarter[2] - Management expressed increased confidence in continued improvement for the second half of the year, with the third-quarter forecast ahead of previous expectations[2] Updated Financial Outlook This section provides LendingTree's preliminary Q2 2025 results and updated financial guidance for Q3 and the full year 2025 Q2 2025 Preliminary Results Preliminary Q2 2025 results surpassed prior guidance, with revenue reaching $250 million, Variable Marketing Margin $83.6 million, and Adjusted EBITDA $31.8 million Q2 2025 Preliminary Results vs. Prior Guidance | Metric | Preliminary Q2 2025 Result (in millions) | Previous Guidance (in millions) | | :--- | :--- | :--- | | Revenue | $250 | $241 - $248 | | Variable Marketing Margin | $83.6 | $80 - $84 | | Adjusted EBITDA | $31.8 | $29 - $31 | Q3 2025 Preliminary Outlook LendingTree projects continued growth for Q3 2025, with revenue expected between $273 million and $281 million and Adjusted EBITDA between $34 million and $36 million Q3 2025 Preliminary Financial Outlook | Metric | Q3 2025 Guidance Range (in millions) | | :--- | :--- | | Revenue | $273 - $281 | | Variable Marketing Margin | $86 - $89 | | Adjusted EBITDA | $34 - $36 | Full-Year 2025 Updated Outlook Reflecting strong performance, the company raised its full-year 2025 revenue forecast to $1.0 - $1.05 billion, with corresponding increases to Variable Marketing Margin and Adjusted EBITDA guidance Full-Year 2025 Updated Outlook vs. Prior Outlook | Metric | Updated 2025 Outlook (in millions) | Prior 2025 Outlook (in millions) | | :--- | :--- | :--- | | Revenue | $1,000 - $1,050 | $955 - $995 | | Variable Marketing Margin | $329 - $336 | $319 - $332 | | Adjusted EBITDA | $119 - $126 | $116 - $124 | Reconciliation of Non-GAAP Measures to GAAP This section provides detailed reconciliations of LendingTree's non-GAAP financial measures, including Variable Marketing Expense, Variable Marketing Margin, and Adjusted EBITDA, to their respective GAAP equivalents Variable Marketing Expense Reconciliation For Q2 2025, GAAP Selling and marketing expense of $176.8 million was reconciled to non-GAAP Variable marketing expense of $166.5 million by excluding $10.3 million in non-variable costs Reconciliation of Selling and Marketing Expense to Variable Marketing Expense (Q2 2025) | Line Item | Amount (in thousands) | | :--- | :--- | | Selling and marketing expense (GAAP) | $176,753 | | Less: Non-variable selling and marketing expense | ($10,285) | | Variable marketing expense (Non-GAAP) | $166,468 | Variable Marketing Margin Reconciliation The company reconciled its Q2 2025 GAAP Net Income of $8.9 million to a non-GAAP Variable Marketing Margin of $83.6 million, representing 33% of revenue after various adjustments Reconciliation of Net Income to Variable Marketing Margin (Q2 2025) | Line Item | Amount (in thousands) | | :--- | :--- | | Net income (GAAP) | $8,862 | | Adjustments (Cost of revenue, G&A, etc.) | $74,786 | | Variable marketing margin (Non-GAAP) | $83,648 | Adjusted EBITDA Reconciliation For Q2 2025, GAAP Net Income of $8.9 million was reconciled to a non-GAAP Adjusted EBITDA of $31.8 million, representing a 13% margin after various add-backs Reconciliation of Net Income to Adjusted EBITDA (Q2 2025) | Line Item | Amount (in thousands) | | :--- | :--- | | Net income (GAAP) | $8,862 | | Adjustments (Amortization, Depreciation, Interest, etc.) | $22,931 | | Adjusted EBITDA (Non-GAAP) | $31,793 | Principles of Financial Reporting This section defines LendingTree's non-GAAP measures, Variable Marketing Margin and Adjusted EBITDA, explaining their use for evaluating marketing effectiveness and operating performance, while noting the inability to reconcile forward-looking non-GAAP guidance to GAAP Definitions of Non-GAAP Measures LendingTree defines Variable Marketing Margin as a measure of marketing efficiency and Adjusted EBITDA as a primary metric for evaluating business operating performance, both excluding specific items - Variable marketing margin is a measure of the efficiency of the Company's operating model, representing revenue after subtracting variable marketing expense[12] - Adjusted EBITDA is a primary metric by which LendingTree evaluates the operating performance of its businesses and on which internal budgets and compensation are based[13] - The company cannot reconcile projected Variable Marketing Margin or Adjusted EBITDA to GAAP results due to the unknown effect of legal matters, tax considerations, and other variable items[15] Additional Information This section includes a safe harbor statement regarding forward-looking information and an overview of LendingTree's business operations Safe Harbor Statement This section provides a standard legal disclaimer for forward-looking statements, cautioning that actual results may differ due to various risk factors including economic conditions, competition, and regulatory changes - The press release contains forward-looking statements subject to risks and uncertainties[16] - Key risk factors include adverse economic conditions (particularly interest rates and inflation), changes in relationships with network partners, competition, and evolving laws and regulations[16][18] About LendingTree, Inc. LendingTree is one of the largest online financial platforms in the U.S., empowering consumers by providing access to loans, credit cards, and insurance offers through a network of over 430 financial partners - LendingTree is one of the nation's largest online financial platforms, providing customers access to offers on loans, credit cards, and insurance[20] - The company operates a network of over 430 financial partners to provide these offers to consumers[20]