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IAC(IAC) - 2025 Q2 - Quarterly Report

PART I. FINANCIAL INFORMATION This section presents IAC Inc.'s unaudited consolidated financial statements and management's discussion and analysis of financial condition and results of operations Item 1. Consolidated Financial Statements This section presents IAC Inc.'s unaudited consolidated financial statements, including the balance sheet, statement of operations, comprehensive operations, shareholders' equity, and cash flows, along with detailed notes explaining significant accounting policies, financial instruments, debt, segment information, income taxes, and discontinued operations Consolidated Balance Sheet This statement provides a snapshot of the company's assets, liabilities, and shareholders' equity at specific points in time Balance Sheet Summary | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :----------------------------- | :------------------------------- | | Total Assets | $7,360,395 | $9,688,644 | | Total Liabilities | $2,417,883 | $3,384,500 | | Total Shareholders' Equity | $4,937,503 | $6,278,973 | - Total assets decreased by approximately $2.3 billion, and total liabilities decreased by approximately $966 million from December 31, 2024, to June 30, 2025. Total shareholders' equity also decreased by approximately $1.3 billion10 Consolidated Statement of Operations This statement details the company's revenues, expenses, and net earnings or losses over specific reporting periods Statement of Operations Summary | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Revenue | $586,928 | $634,393 | $1,157,417 | $1,258,683 | | Operating income (loss) | $575 | $(21,489) | $36,351 | $(84,910) | | Net earnings (loss) attributable to IAC shareholders | $211,452 | $(142,232) | $(5,353) | $(97,201) |\n| Basic earnings (loss) per share | $2.64 | $(1.71) | $(0.07) | $(1.17) |\n| Diluted earnings (loss) per share | $2.57 | $(1.71) | $(0.07) | $(1.17) | - Revenue decreased by 7% for the three months ended June 30, 2025, and by 8% for the six months ended June 30, 2025, compared to the prior year periods. The company reported a significant turnaround in net earnings attributable to IAC shareholders, moving from a loss of $(142,232) thousand in Q2 2024 to a gain of $211,452 thousand in Q2 202512 Consolidated Statement of Comprehensive Operations This statement presents net earnings alongside other comprehensive income or loss components, reflecting total non-owner changes in equity Statement of Comprehensive Operations Summary | Metric | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Net earnings (loss) | $210,633 | $(141,467) | $(3,935) | $(96,495) | | Total other comprehensive (loss) income, net of income taxes | $(109) | $377 | $1,105 | $4,270 | | Comprehensive income (loss) attributable to IAC shareholders | $211,343 | $(141,814) | $(4,681) | $(92,736) | - Comprehensive income attributable to IAC shareholders significantly improved from a loss of $(141,814) thousand in Q2 2024 to an income of $211,343 thousand in Q2 202514 Consolidated Statement of Shareholders' Equity This statement outlines the changes in each component of shareholders' equity, including common stock, retained earnings, and other comprehensive income Shareholders' Equity Summary | Metric | Balance at December 31, 2024 (in thousands) | Balance at June 30, 2025 (in thousands) | | :----------------------------------- | :---------------------------------------- | :-------------------------------------- | | Total IAC shareholders' equity | $5,577,898 | $4,911,092 | | Noncontrolling interests | $701,075 | $26,411 | | Total shareholders' equity | $6,278,973 | $4,937,503 | - Total IAC shareholders' equity decreased by $666.8 million from December 31, 2024, to June 30, 2025. Noncontrolling interests saw a substantial decrease of $674.6 million, primarily due to the Angi Inc. spin-off101728 Consolidated Statement of Cash Flows This statement categorizes cash inflows and outflows from operating, investing, and financing activities, showing changes in liquidity Cash Flow Summary | Cash Flow Activity | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Operating activities attributable to continuing operations | $(2,691) | $60,155 | | Investing activities attributable to continuing operations | $(374,421) | $244,038 | | Financing activities attributable to continuing operations | $(298,694) | $(24,098) | | Net (decrease) increase in cash and cash equivalents and restricted cash | $(703,796) | $319,760 | - Net cash from operating activities for continuing operations shifted from a positive $60.2 million in H1 2024 to a negative $(2.7) million in H1 2025. Investing activities saw a significant outflow of $(374.4) million in H1 2025, primarily due to the Angi Inc. spin-off cash distribution, compared to an inflow of $244.0 million in H1 2024. Financing activities also resulted in a larger cash outflow of $(298.7) million in H1 2025, mainly due to principal payments on Term Loans and treasury stock repurchases23231232 Note 1—The Company and Summary of Significant Accounting Policies This note describes IAC Inc.'s business, recent corporate changes like the Angi spin-off, and the key accounting principles applied in its financial statements - IAC Inc. is comprised of category-leading businesses like People Inc. (formerly Dotdash Meredith Inc.) and Care.com, and holds strategic equity positions in MGM Resorts International and Turo Inc.27155 - On March 31, 2025, IAC completed the spin-off of Angi Inc., making Angi an independent public company. Angi's operations are now presented as discontinued operations in IAC's consolidated financial statements for periods prior to the spin-off28157 - Revenue from Google represented 16% of total revenue for both the three and six months ended June 30, 2025, down from 20% in the prior year periods. The Services Agreement with Google was extended to March 31, 2026, with potential impacts on Search revenue due to changes in economic terms effective April 1, 20254445168169 Deferred Revenue | Deferred Revenue | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Balance at January 1 | $56,633 | $93,683 | | Balance at June 30 | $65,074 | $69,433 | Note 2—Financial Instruments and Fair Value Measurements This note details the company's financial instruments, including investments in MGM and Turo, and their fair value measurement and related impacts Investment in MGM Resorts International | Investment in MGM | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :----------------------------- | :------------------------------- | | Carrying Value | $2,225,844 | $2,242,672 | - IAC owns 23.8% of MGM Resorts International common shares and accounts for this investment using the fair value option. For the three months ended June 30, 2025, the Company recorded an unrealized pre-tax gain of $307.4 million on its MGM investment, compared to a loss of $179.3 million in the prior year period. The cumulative unrealized net pre-tax gain through June 30, 2025, is $962.0 million52203204 Long-term Investments | Long-term Investments | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :----------------------------- | :------------------------------- | | Equity securities without readily determinable fair values | $409,574 | $438,534 | - The Company net settled its Turo warrant on July 23, 2024, for 4.5 million shares of Series E-2 preferred stock, reclassifying its fair value of $70.0 million to equity securities without readily determinable fair values63 Note 3—Long-term Debt This note provides information on the company's long-term debt, including refinancing activities, interest rates, and compliance with debt covenants Long-term Debt Breakdown | Debt Type | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :----------------------------- | :------------------------------- | | Term Loan A-1 due May 14, 2030 | $350,000 | — | | Term Loan B-2 due June 16, 2032 | $700,000 | — | | 7.625% Senior Secured Notes due June 15, 2032 | $400,000 | — | | Term Loan A due December 1, 2026 | — | $297,500 | | Term Loan B-1 due December 1, 2028 | — | $1,182,500 | | Total long-term debt | $1,450,000 | $1,480,000 | - People Inc. completed a debt refinancing in Q2 2025, replacing existing Term Loans with new Term Loan A-1 ($350M), Term Loan B-2 ($700M), and 7.625% Senior Secured Notes ($400M), extending maturity dates and resulting in a net debt decrease of $21.3 million. The refinancing also included a new $150 million revolving credit facility69170237 - People Inc. maintains interest rate swaps with a notional amount of $350 million to hedge a portion of its variable-rate Term Loan B-2, synthetically converting it to a fixed rate of approximately 7.32% until April 1, 202781253 - The governing agreements require People Inc. to maintain a consolidated net leverage ratio of no greater than 5.5 to 1.0, and its ratio was less than 4.0 to 1.0 as of June 30, 2025. IAC contributed $80 million to People Inc. in June 2025, which was subsequently distributed to IAC in July 2025, improving People Inc.'s leverage ratio and reducing interest rates7374247 Note 4—Accumulated Other Comprehensive Loss This note presents the components of accumulated other comprehensive income or loss, such as foreign currency translation adjustments and unrealized gains or losses on derivatives Accumulated Other Comprehensive Loss Components | Component | Balance at January 1, 2025 (in thousands) | Balance at June 30, 2025 (in thousands) | | :----------------------------------- | :---------------------------------------- | :-------------------------------------- | | Foreign Currency Translation Adjustment | $(12,703) | $(9,799) | | Unrealized Gains (Losses) On Interest Rate Swaps | $1,307 | $(1,303) |\n| Total Accumulated Other Comprehensive (Loss) Income | $(11,396) | $(11,102) | - Accumulated other comprehensive loss slightly decreased from $(11,396) thousand at January 1, 2025, to $(11,102) thousand at June 30, 2025. This change was primarily driven by a positive foreign currency translation adjustment, partially offset by unrealized losses on interest rate swaps86 Note 5—Segment Information This note disaggregates the company's financial performance by its operating segments, including People Inc., Care.com, and Search Revenue by Segment | Segment | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | People Inc. Total | $427,370 | $425,161 | $820,441 | $815,701 | | Care.com | $82,020 | $87,650 | $170,872 | $180,177 | | Search | $61,690 | $101,756 | $132,019 | $210,229 | | Emerging & Other | $15,877 | $19,886 | $34,164 | $53,900 | | Total Revenue | $586,928 | $634,393 | $1,157,417 | $1,258,683 | Adjusted EBITDA by Segment | Segment Adjusted EBITDA | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | People Inc. Total | $69,621 | $66,424 | $149,912 | $96,666 | | Care.com | $5,839 | $2,695 | $20,333 | $19,128 | | Search | $5,101 | $4,645 | $8,110 | $9,022 | | Emerging & Other | $(6,338) | $(6,507) | $(10,856) | $(27,146) | | Total Segment Adjusted EBITDA | $74,223 | $67,257 | $167,499 | $97,670 | - People Inc. revenue increased 1% for both the three and six months ended June 30, 2025, driven by Digital growth (9% and 8% respectively) offsetting Print declines (9% and 8% respectively). Search revenue decreased significantly by 39% and 37% for the three and six months, respectively, due to channel mix and reduced marketing through affiliate partners92172174 - Total Segment Adjusted EBITDA increased by 15% for the three months and 103% for the six months ended June 30, 2025, primarily due to People Inc.'s improved performance, including a $36.2 million gain from a lease termination98199 Note 6—Pension and Post-retirement Benefit Plans This note outlines the net periodic benefit costs and obligations associated with the company's pension and post-retirement benefit plans Net Periodic Benefit Cost (Credit) | Net Periodic Benefit Cost (Credit) | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Pension Domestic | $77 | $(596) | $114 | $(643) | | Pension International | $12 | $(1) | $24 | $(1) | | Post-Retirement Domestic | $53 | $52 | $106 | $103 | - Net periodic benefit cost for domestic pension plans shifted from a credit of $(596) thousand in Q2 2024 to a cost of $77 thousand in Q2 2025, and from a credit of $(643) thousand in H1 2024 to a cost of $114 thousand in H1 2025105 Note 7—Income Taxes This note details the company's income tax provision or benefit, effective tax rates, and unrecognized tax benefits Income Tax Metrics | Income Tax 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 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Income tax (provision) benefit | $(63,040) thousand | $40,432 thousand | $16,194 thousand | $(6,095) thousand | | Effective income tax rate | 23% | 22% | 46% | N/A (provision despite loss) | - For Q2 2025, the Company recorded an income tax provision of $63.0 million (23% effective rate), higher than the statutory rate due to deferred tax adjustments, state taxes, and research credits. For H1 2025, an income tax benefit of $16.2 million (46% effective rate) was recorded, influenced by nontaxable stock-based compensation expense reversal due to the former CEO's restricted stock award forfeiture109207209 - Unrecognized tax benefits, including interest and penalties, increased to $15.9 million at June 30, 2025, from $14.6 million at December 31, 2024, primarily due to research credits. The Company expects a potential decrease of $0.3 million by June 30, 2026, from settlements and statute expirations113 Note 8—Earnings (Loss) Per Share This note explains the calculation of basic and diluted earnings per share, including factors affecting share count and net earnings Earnings (Loss) Per Share | EPS 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 | | :----------------------------------- | :------------------------------- | :------------------------------- | :----------------------------- | :----------------------------- | | Basic EPS | $2.64 | $(1.71) | $(0.07) | $(1.17) | | Diluted EPS | $2.57 | $(1.71) | $(0.07) | $(1.17) | - Basic and diluted EPS significantly improved from losses in Q2 2024 to positive earnings in Q2 2025. The calculation of EPS for 2025 was impacted by the forfeiture of the former CEO's restricted stock award on January 13, 2025, which was a participating security117122124 Note 9—Financial Statement Details This note provides additional disaggregated information for various balance sheet and income statement line items, such as cash and other income Cash & Equivalents | Cash & Equivalents | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :----------------------------- | :------------------------------- | | Cash and cash equivalents | $1,093,866 | $1,381,736 | | Total cash and cash equivalents and restricted cash | $1,103,459 | $1,807,255 | - Total cash and cash equivalents and restricted cash decreased by $703.8 million from December 31, 2024, to June 30, 2025127 Allowance for Credit Losses | Allowance for Credit Losses | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Balance at January 1 | $7,409 | $7,695 | | Balance at June 30 | $6,745 | $6,243 | Other Income, Net | Other Income, Net | Three Months Ended June 30, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2025 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Interest income | $11,270 | $16,962 | $25,734 | $33,850 | | Net (downward) upward adjustments to equity securities and net gain (loss) on sales of investments and businesses | $(11,219) | $2,262 | $(18,845) | $28,203 | | Unrealized increase in the estimated fair value of a warrant | — | $30,624 | — | $20,393 | | Total Other income, net | $2,828 | $50,123 | $10,516 | $80,444 | Note 10—Contingencies This note describes the company's exposure to various legal proceedings and contingent liabilities, and management's assessment of their potential impact - The Company is subject to various lawsuits and contingent matters in the ordinary course of business. Accruals are established when an unfavorable outcome is probable and estimable. Management believes current claims will not materially impact liquidity, results, or financial condition, but acknowledges inherent uncertainties132 Note 11—Related Party Transactions This note discloses transactions and relationships with entities considered related parties, including Angi, Vimeo, and Expedia Group - Following the Angi spin-off on March 31, 2025, Angi is no longer considered a related party, though certain pre-existing agreements (e.g., services agreement, employee matters agreement) survive the Distribution137139140 - IAC and Vimeo Inc. remain related parties due to common beneficial ownership by Mr. Diller, with certain separation and commercial agreements still in effect142 - IAC and Expedia Group are related parties due to Mr. Diller's role as Chairman and Senior Executive for both. They share ownership and costs for two aircraft and have a five-year lease agreement for office space in IAC's New York City headquarters, with payments not material for the reported periods144146147 Note 12—Discontinued Operations This note presents the financial results and related information for business segments that have been divested or spun off, such as Angi Inc - Angi Inc. is presented as discontinued operations in IAC's consolidated financial statements for all periods prior to its spin-off on March 31, 2025. The Company does not expect significant cash flows from discontinued operations post-Distribution150236 Discontinued Operations Financials | Metric | January 1 through March 31, 2025 (in thousands) | Three Months Ended June 30, 2024 (in thousands) | Six Months Ended June 30, 2024 (in thousands) | | :----------------------------------- | :-------------------------------------------- | :-------------------------------------------- | :-------------------------------------------- | | Revenue | $245,913 | $315,134 | $620,524 | | Operating income from discontinued operations | $20,358 | $9,490 | $13,733 | | Earnings (loss) from discontinued operations, net of tax | $15,313 | $3,225 | $(1,247) | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations This section provides management's perspective on IAC's financial performance, condition, and liquidity for the three and six months ended June 30, 2025, compared to the prior year. It details revenue and expense trends across segments, discusses the Angi spin-off, and outlines the company's financial position, cash flows, debt, and capital resources General This section provides an overview of recent corporate developments, including rebranding, spin-offs, and key agreements impacting the company's operations - Dotdash Meredith Inc. was rebranded 'People Inc.' on July 31, 2025, and is a key component of IAC's category-leading businesses, alongside Care.com and strategic equity positions in MGM and Turo155 - The spin-off of Angi Inc. was completed on March 31, 2025, making Angi an independent public company and reclassifying its operations as discontinued in IAC's financial statements prior to that date157 - The Services Agreement with Google was amended and extended to March 31, 2026, with potential impacts on Search revenue due to changes in economic terms effective April 1, 2025168169 Results of Operations for the Three and Six Months Ended June 30, 2025 Compared to the Three and Six Months Ended June 30, 2024 This section analyzes the company's revenue and expense trends across its segments for the current and prior year periods, highlighting key performance drivers Revenue Performance by Segment | Metric | Q2 2025 (in thousands) | Q2 2024 (in thousands) | % Change (QoQ) | H1 2025 (in thousands) | H1 2024 (in thousands) | % Change (YoY) | | :----------------------------------- | :--------------------- | :--------------------- | :------------- | :--------------------- | :--------------------- | :------------- | | Total Revenue | $586,928 | $634,393 | (7)% | $1,157,417 | $1,258,683 | (8)% | | People Inc. Revenue | $427,370 | $425,161 | 1% | $820,441 | $815,701 | 1% | | Care.com Revenue | $82,020 | $87,650 | (6)% | $170,872 | $180,177 | (5)% | | Search Revenue | $61,690 | $101,756 | (39)% | $132,019 | $210,229 | (37)% | | Emerging & Other Revenue | $15,877 | $19,886 | (20)% | $34,164 | $53,900 | (37)% | - People Inc. Digital revenue increased by 9% in Q2 2025 and 8% in H1 2025, driven by advertising, performance marketing, and licensing revenue, including contributions from the OpenAI Partnership. Print revenue declined by 9% in Q2 2025 and 8% in H1 2025 due to portfolio optimization and audience migration to digital172174 - Search revenue decreased significantly due to reduced traffic acquisition costs and lower revenue from affiliate partners, as well as a decline in search queries from legacy business-to-business operations172174175 Operating Expenses | Expense Category | Q2 2025 (in thousands) | Q2 2024 (in thousands) | % Change (QoQ) | H1 2025 (in thousands) | H1 2024 (in thousands) | % Change (YoY) | | :----------------------------------- | :--------------------- | :--------------------- | :------------- | :--------------------- | :--------------------- | :------------- | | Cost of revenue | $201,971 | $253,351 | (20)% | $407,254 | $512,818 | (21)% | | Selling and marketing expense | $185,825 | $177,311 | 5% | $366,739 | $365,388 | 0% | | General and administrative expense | $117,343 | $126,006 | (7)% | $180,167 | $253,478 | (29)% | | Product development expense | $49,826 | $53,380 | (7)% | $100,039 | $116,623 | (14)% | | Depreciation | $7,980 | $9,124 | (13)% | $19,926 | $21,848 | (9)% | | Amortization of intangibles | $23,408 | $36,710 | (36)% | $46,941 | $73,438 | (36)% | - Operating income significantly improved from a loss of $(21.5) million in Q2 2024 to an income of $0.6 million in Q2 2025, and from a loss of $(84.9) million in H1 2024 to an income of $36.4 million in H1 2025. This was driven by decreases in amortization of intangibles, depreciation, and stock-based compensation expense, along with an increase in Adjusted EBITDA192194195 Adjusted EBITDA Performance | Adjusted EBITDA | Q2 2025 (in thousands) | Q2 2024 (in thousands) | % Change (QoQ) | H1 2025 (in thousands) | H1 2024 (in thousands) | % Change (YoY) | | :----------------------------------- | :--------------------- | :--------------------- | :------------- | :--------------------- | :--------------------- | :------------- | | Total Segment Adjusted EBITDA | $74,223 | $67,257 | 15% | $167,499 | $97,670 | 71% | | Corporate Adjusted EBITDA loss | $(22,785) | $(22,485) | (1)% | $(65,206) | $(47,357) | (38)% | | Total Adjusted EBITDA | $51,438 | $44,772 | 15% | $102,293 | $50,313 | 103% | - Total Adjusted EBITDA increased by 15% in Q2 2025 and 103% in H1 2025, primarily due to People Inc.'s improved performance, including a $36.2 million gain from a lease termination, and Care.com's increased Adjusted EBITDA due to lower legal accruals199 - Interest expense increased in Q2 2025 due to an $8.5 million extinguishment loss from debt refinancing and interest on new 2032 Notes, partially offset by lower interest rates and debt outstanding. For H1 2025, interest expense decreased due to lower rates and debt, despite the extinguishment loss201202 - The Company recorded a significant unrealized pre-tax gain of $307.4 million on its MGM investment in Q2 2025, a substantial improvement from a loss of $179.3 million in Q2 2024203 Principles of Financial Reporting This section explains the non-GAAP financial measures used by management, such as Adjusted EBITDA, and their reconciliation to GAAP results - Adjusted EBITDA is a non-GAAP financial measure used as the primary segment measure of profitability, excluding stock-based compensation, depreciation, and acquisition-related items (amortization of intangibles, goodwill/intangible asset impairments, and contingent consideration fair value changes)215216 - The Company provides Adjusted EBITDA to offer investors the same tools used internally for performance analysis, emphasizing that it should be considered supplementary to GAAP results215 Financial Position, Liquidity and Capital Resources This section assesses the company's financial health, including cash position, debt levels, cash flow activities, and capital allocation strategies Cash & Debt Position | Cash & Debt | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :----------------------------------- | :----------------------------- | :------------------------------- | | Total cash and cash equivalents | $1,093,866 | $1,381,736 | | Total long-term debt | $1,450,000 | $1,480,000 | - The Company's consolidated cash and cash equivalents decreased to $1.1 billion at June 30, 2025, from $1.38 billion at December 31, 2024. People Inc. holds $262.7 million of this cash, which IAC may not freely access due to debt covenants228246 - Net cash used in operating activities attributable to continuing operations was $(2.7) million for H1 2025, a decrease from $60.2 million provided in H1 2024, primarily due to changes in working capital and non-cash adjustments229230 - Investing activities for continuing operations resulted in a net cash outflow of $(374.4) million in H1 2025, largely due to a $386.6 million cash distribution related to the Angi spin-off. Financing activities used $(298.7) million, including $1.4 billion in Term Loan principal payments and $200.0 million for treasury stock repurchases231232 - IAC repurchased 4.5 million shares of common stock for $200.0 million in H1 2025, with 9.2 million shares remaining under the 2025 Share Authorization as of August 1, 2025241 - The Company expects 2025 capital expenditures to increase by 30% to 40% compared to $15.0 million in 2024, mainly due to capitalized software at People Inc.244 - Management believes existing cash, cash equivalents, and expected positive cash flows will be sufficient to fund operating requirements for the foreseeable future, but may need additional financing for acquisitions or to refinance existing capital249 Item 3. Quantitative and Qualitative Disclosures About Market Risk This section discusses the Company's exposure to market risks, specifically equity price risk related to its investment in MGM Resorts International and interest rate risk associated with its variable-rate long-term debt - IAC's investment in MGM Resorts International (23.8% ownership, $2.2 billion carrying value at June 30, 2025) exposes it to equity price risk. A $2.00 change in MGM's share price would result in a $129.4 million unrealized gain or loss250251 - The Company's $1.05 billion variable-rate Term Loans (part of People Inc.'s $1.45 billion debt) expose it to interest rate risk. Interest rate swaps hedge $350 million of this debt to a fixed rate. A 100 basis point change in SOFR would impact annual interest expense by $7.0 million, net of the swap's effect252253254 Item 4. Controls and Procedures Management, including the Chairman and Senior Executive and CFO, evaluated the effectiveness of the Company's disclosure controls and procedures, concluding they were effective as of June 30, 2025. No material changes to internal control over financial reporting occurred during the quarter - The Company's disclosure controls and procedures were deemed effective as of June 30, 2025, following an evaluation by management, including the Chairman and Senior Executive and CFO255 - No material changes to the Company's internal control over financial reporting occurred during the quarter ended June 30, 2025256 PART II. OTHER INFORMATION This section covers legal proceedings, risk factors, equity sales, and internal controls, providing additional context to the financial statements Item 1. Legal Proceedings This section details ongoing shareholder litigation related to the 2020 MTCH Separation, which was remanded to the Chancery Court under an 'entire fairness' review standard. A settlement in principle for $30 million has been reached, with most covered by insurers, and is awaiting court approval - Shareholder litigation challenging the 2020 MTCH Separation was remanded to the Delaware Chancery Court for review under the 'entire fairness' standard264 - A settlement in principle has been reached, with $30 million to be paid to the plaintiff class. Approximately $29.8 million will be covered by defendants' insurers, and IAC will pay approximately $0.2 million. A hearing for court approval is scheduled for September 17, 2025266 Item 1A. Risk Factors This section provides a cautionary statement regarding forward-looking information and confirms that there have been no material changes to the risk factors previously disclosed in the Company's Annual Report on Form 10-K for the year ended December 31, 2024 - No material changes to the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024, have occurred270 - Forward-looking statements are subject to various risks, including market conditions, Google policy changes, AI technology disruption, liquidity, and debt covenants268 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds This section reports that the Company did not engage in any unregistered sales of equity securities during the quarter ended June 30, 2025. It also details share repurchase activity, with 563,807 shares bought back in April 2025 at an average price of $36.55 per share - The Company did not issue or sell any shares of its common stock or other equity securities through unregistered transactions during Q2 2025271 Share Repurchase Activity | Period | Total Number of Shares Purchased | Average Price Paid Per Share | | :----------------------------------- | :----------------------------- | :--------------------------- | | April 2025 | 563,807 | $36.55 | | May 2025 | — | — | | June 2025 | — | — | | Total | 563,807 | $36.55 | - As of August 1, 2025, IAC has 9.2 million shares remaining under its 2025 Share Authorization241 Item 5. Other Information This section states that no directors or officers adopted or terminated Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025 - No directors or officers adopted or terminated Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements during the quarter ended June 30, 2025274 Item 6. Exhibits This section lists all documents filed as exhibits to the Form 10-Q, including the Restated Certificate of Incorporation, Indenture, and amendments to the Credit Agreement, along with certifications Signatures This section contains the official certifications and signatures required for the submission of the Form 10-Q