Group 1 - IAC will participate in the Oppenheimer 28th Annual Technology, Internet & Communications Conference on August 13, 2025, featuring a fireside chat with key executives [1] - Christopher Halpin, Executive Vice President, COO and CFO of IAC, and Neil Vogel, CEO of People Inc., will be the speakers at the event [1] - The fireside chat will be available for live webcast and replay on IAC's investor relations website [1] Group 2 - IAC is a company that builds and evolves businesses, guided by curiosity and a desire to innovate or acquire new products and brands [2] - The company has developed into 10 independent, publicly-traded companies and has a history of financially-disciplined opportunism [2] - IAC's current portfolio includes category-leading businesses such as People Inc. and Care.com, along with strategic equity positions in MGM Resorts International and Turo Inc. [2]

Financial Data and Key Metrics Changes - People Inc achieved a 9% digital revenue growth in Q2, up from 7% in Q1, marking a return to core sessions growth [6][9] - Consolidated IAC adjusted EBITDA increased by 15% in the quarter, with guidance for full-year EBITDA set between $247 million and $285 million [9][45] - The refinancing of $1.4 billion in debt at People Inc was completed, replacing the original acquisition capital structure with new bank debt and bonds [6] Business Line Data and Key Metrics Changes - MGM reported a 36% net revenue growth in Q2, with increased guidance for the full year to at least $2.7 billion in revenue and at least $150 million in EBITDA [8] - Care.com has seen a divergence in performance, with enterprise business growing solidly while consumer revenue has declined from pandemic highs [41][42] - Digital margins for People Inc reached just under 29% in FY 2024, with Q2 digital EBITDA flat year-over-year at $63 million despite a 9% revenue growth [37][38] Market Data and Key Metrics Changes - The percentage of traffic from Google has decreased from 52% to 28%, while non-Google search sessions have increased at a 29% CAGR [32][33] - Approximately 36% of digital revenue now comes from off-platform sources, indicating a shift in revenue generation strategies [30][31] Company Strategy and Development Direction - The rebranding to People Inc aims to reflect the company's focus on premium content created by people for people, emphasizing the importance of human expertise [11][14] - The company is actively pursuing M&A opportunities and exploring strategic divestitures to bolster cash balances [10][69] - A focus on diversifying audience sources and reducing reliance on Google traffic is central to the company's strategy, with investments in email, events, and syndication businesses [24][25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving revenue goals despite challenges posed by AI and changes in Google's search algorithms [21][32] - The company anticipates continued growth in off-platform audiences and improved monetization, guiding for 7% to 9% digital revenue growth in Q3 [58] - Management acknowledged the need to optimize the matching process on Care.com to drive growth in both consumer and enterprise segments [90][91] Other Important Information - The company has maintained guidance for Care.com at $45 million to $55 million, while corporate run rate costs have been reduced to $110 million to $115 million [46] - The company is exploring new pricing and packaging strategies to better meet consumer needs in the care marketplace [90] Q&A Session Summary Question: Can you elaborate on the trajectory of sessions, including Google Search and off-platform views? - Management expects O&O sessions to be slightly down in Q3 due to tough comps but anticipates flat to slightly up growth going forward, with off-platform growth continuing [50][51] Question: Can you provide insights on the 2Q PeopleLink digital revenue? - Digital advertising grew 5% in Q2, with strong performance in performance marketing and licensing, while core sessions growth was 2% [55][56] Question: Why is the new brand name People Inc the right choice? - The name reflects the company's goal of achieving platform scale with premium branded environments, resonating well with clients and employees [64][66] Question: What is the current state of the M&A landscape? - The company is actively pursuing both small and large acquisition opportunities, focusing on creative and defensible businesses [69][70] Question: What factors need to change for Care.com to grow faster? - The company needs to drive consumer demand and improve the matching process between care seekers and providers, while expanding into senior and pet care markets [90][91]

Financial Data and Key Metrics Changes - IAC reported a 15% increase in adjusted EBITDA for the quarter, with guidance for full-year EBITDA set between $247 million and $285 million [7][44] - Digital revenue growth accelerated to 9% in Q2, up from 7% in Q1, marking a return to core sessions growth [5][45] - The refinancing of $1.4 billion in debt at People Inc. was completed, replacing the original acquisition capital structure with new bank debt and bonds at attractive pricing [5] Business Line Data and Key Metrics Changes - People Inc. achieved 9% digital revenue growth, with core sessions growth returning despite macro volatility [5] - MGM reported a 36% net revenue growth in Q2, with increased full-year revenue guidance to at least $2.7 billion [6] - Care.com is seeing promising signs of growth in engagement metrics following a product and brand revitalization [7][42] Market Data and Key Metrics Changes - The percentage of traffic from Google has decreased from 52% to 28%, while overall sessions have increased [31][27] - Off-platform views have become a significant revenue source, contributing to approximately one-third of digital revenue [28][29] - The digital margins for People Inc. reached just under 29% in FY 2024, with expectations for continued growth in adjusted EBITDA margins [36] Company Strategy and Development Direction - The rebranding to People Inc. aims to reflect the company's focus on premium content created by people for people, enhancing its market positioning [10][66] - The company is actively pursuing M&A opportunities and exploring strategic divestitures to bolster its cash balance [9][68] - A focus on diversifying audience sources and reducing reliance on Google traffic is central to the company's strategy [23][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to maintain growth despite challenges posed by AI and changes in Google’s search algorithms [77][78] - The company anticipates continued growth in off-platform audiences and improved monetization strategies [49][56] - Management remains optimistic about the long-term revenue growth target of 10% for digital revenue, driven by various initiatives [95] Other Important Information - Care.com has relaunched its platform, enhancing user experience and aiming to drive consumer engagement [41][42] - The company is focusing on optimizing its product offerings and marketing strategies to capture a larger share of the addressable market [88][90] Q&A Session Summary Question: Can you elaborate on the trajectory of sessions, including Google Search and off-platform views? - Management expects O&O sessions to be flat to slightly up in the future, with continued growth in off-platform views [48][49] Question: What are the factors affecting the 2Q PeopleLink digital revenue? - Digital advertising grew 5%, with strong performance in performance marketing and licensing, despite some challenges in core sessions [53][54] Question: What is the current penetration of Google AI reviews? - AI reviews are present in approximately 50% to 55% of searches where the company's content appears [75] Question: What is the outlook for M&A opportunities? - The company is actively evaluating both public and private opportunities, focusing on quality defensible businesses and AI applications [68][70] Question: What factors need to be addressed for Care.com to grow faster? - The company needs to improve product experience, expand pricing and packaging options, and enhance matching capabilities between care seekers and providers [88][90]

Financial Performance & Guidance - IAC's consolidated Adjusted EBITDA grew by 15% [8] - Full-year 2025 Adjusted EBITDA guidance is between $247 million and $285 million [8] - People Inc expects Q3 2025 Digital revenue growth of 7%-9% and total Adjusted EBITDA between $68 million and $73 million [54] - For FY 2025, People Inc expects Digital revenue growth between 7%-10% [54] People Inc (Formerly Dotdash Meredith) - Digital revenue growth accelerated to 9% [8] - Digital Adjusted EBITDA margin was 24% in Q2 2025 [32] - People Inc's Digital revenue for Q2 2025 was $260 million [32] - People Inc's Digital Adjusted EBITDA for Q2 2025 was $63 million [32] Care.com - Care.com's revenue for the last twelve months ending June 30, 2025, was $360 million [46] - Care.com's Adjusted EBITDA for the last twelve months ending June 30, 2025, was $46 million [46] - Care.com expects revenue declines of 4%-7% in Q3 [54]

Core Insights - IAC reported a revenue of $586.93 million for the quarter ended June 2025, marking a year-over-year decline of 38.2% and a surprise of -2.53% compared to the Zacks Consensus Estimate of $602.19 million [1] - The earnings per share (EPS) for the same period was $2.57, a significant increase from $0.01 a year ago, resulting in an EPS surprise of +956.67% against a consensus estimate of -$0.30 [1] Revenue Performance - Revenue from Emerging & Other was $15.9 million, slightly above the average estimate of $14.96 million, but represented a year-over-year decline of 85.2% [4] - Search revenue totaled $61.7 million, below the average estimate of $77.09 million, reflecting a year-over-year decrease of 39.4% [4] - Care.com revenue was reported at $82 million, closely matching the estimated $82.06 million [4] - Desktop Search revenue was $10.2 million, falling short of the average estimate of $13.11 million, with a year-over-year decline of 41.7% [4] - Ask Media Group Search revenue was $51.4 million, compared to the average estimate of $64.18 million, indicating a year-over-year change of -39% [4] - Intersegment eliminations reported $0 million, contrasting with the average estimate of -$0.29 million, representing a 100% year-over-year change [4] Adjusted EBITDA - Adjusted EBITDA for Care.com was $5.8 million, exceeding the average estimate of $4.15 million [4] - Corporate Adjusted EBITDA was reported at -$22.8 million, better than the average estimate of -$25.22 million [4] - Adjusted EBITDA for Emerging & Other was -$6.3 million, slightly better than the average estimate of -$6.93 million [4] - Search Adjusted EBITDA was $5.1 million, surpassing the average estimate of $4.54 million [4] Stock Performance - IAC shares returned +0.1% over the past month, while the Zacks S&P 500 composite increased by +0.6% [3] - The stock currently holds a Zacks Rank 4 (Sell), suggesting potential underperformance relative to the broader market in the near term [3]

Group 1: Earnings Performance - IAC reported quarterly earnings of $2.57 per share, significantly beating the Zacks Consensus Estimate of a loss of $0.3 per share, representing an earnings surprise of +956.67% [1] - The company posted revenues of $586.93 million for the quarter ended June 2025, missing the Zacks Consensus Estimate by 2.53%, and down from $949.53 million year-over-year [2] Group 2: Market Performance - IAC shares have declined approximately 10% since the beginning of the year, contrasting with the S&P 500's gain of 6.1% [3] - The current Zacks Rank for IAC is 4 (Sell), indicating expectations of underperformance in the near future [6] Group 3: Future Outlook - The consensus EPS estimate for the upcoming quarter is breakeven on revenues of $615.9 million, while for the current fiscal year, it is -$2.47 on revenues of $2.48 billion [7] - The outlook for the industry, specifically the Diversified Operations sector, is currently in the top 21% of Zacks industries, suggesting potential positive impacts on stock performance [8]

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](index=3&type=page&id=Item%201.%20Consolidated%20Financial%20Statements) 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](index=3&type=section&id=Consolidated%20Balance%20Sheet) 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 billion**[10](index=10&type=chunk) [Consolidated Statement of Operations](index=4&type=section&id=Consolidated%20Statement%20of%20Operations) 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 2025[12](index=12&type=chunk) [Consolidated Statement of Comprehensive Operations](index=5&type=section&id=Consolidated%20Statement%20of%20Comprehensive%20Operations) 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 2025[14](index=14&type=chunk) [Consolidated Statement of Shareholders' Equity](index=6&type=section&id=Consolidated%20Statement%20of%20Shareholders%27%20Equity) 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-off**[10](index=10&type=chunk)[17](index=17&type=chunk)[28](index=28&type=chunk) [Consolidated Statement of Cash Flows](index=8&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) 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 repurchases**[23](index=23&type=chunk)[231](index=231&type=chunk)[232](index=232&type=chunk) [Note 1—The Company and Summary of Significant Accounting Policies](index=9&type=section&id=Note%201%E2%80%94The%20Company%20and%20Summary%20of%20Significant%20Accounting%20Policies) 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.**[27](index=27&type=chunk)[155](index=155&type=chunk) - 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-off**[28](index=28&type=chunk)[157](index=157&type=chunk) - **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, 2025[44](index=44&type=chunk)[45](index=45&type=chunk)[168](index=168&type=chunk)[169](index=169&type=chunk) 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](index=12&type=section&id=Note%202%E2%80%94Financial%20Instruments%20and%20Fair%20Value%20Measurements) 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 million**[52](index=52&type=chunk)[203](index=203&type=chunk)[204](index=204&type=chunk) 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 values**[63](index=63&type=chunk) [Note 3—Long-term Debt](index=16&type=section&id=Note%203%E2%80%94Long-term%20Debt) 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 facility**[69](index=69&type=chunk)[170](index=170&type=chunk)[237](index=237&type=chunk) - **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, 2027[81](index=81&type=chunk)[253](index=253&type=chunk) - 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 rates**[73](index=73&type=chunk)[74](index=74&type=chunk)[247](index=247&type=chunk) [Note 4—Accumulated Other Comprehensive Loss](index=19&type=section&id=Note%204%E2%80%94Accumulated%20Other%20Comprehensive%20Loss) 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 swaps**[86](index=86&type=chunk) [Note 5—Segment Information](index=20&type=section&id=Note%205%E2%80%94Segment%20Information) 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 partners**[92](index=92&type=chunk)[172](index=172&type=chunk)[174](index=174&type=chunk) - **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 termination**[98](index=98&type=chunk)[199](index=199&type=chunk) [Note 6—Pension and Post-retirement Benefit Plans](index=26&type=section&id=Note%206%E2%80%94Pension%20and%20Post-retirement%20Benefit%20Plans) 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 2025[105](index=105&type=chunk) [Note 7—Income Taxes](index=26&type=section&id=Note%207%E2%80%94Income%20Taxes) 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 forfeiture**[109](index=109&type=chunk)[207](index=207&type=chunk)[209](index=209&type=chunk) - **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 expirations[113](index=113&type=chunk) [Note 8—Earnings (Loss) Per Share](index=28&type=section&id=Note%208%E2%80%94Earnings%20%28Loss%29%20Per%20Share) 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 security**[117](index=117&type=chunk)[122](index=122&type=chunk)[124](index=124&type=chunk) [Note 9—Financial Statement Details](index=31&type=section&id=Note%209%E2%80%94Financial%20Statement%20Details) 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, 2025[127](index=127&type=chunk) 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](index=33&type=section&id=Note%2010%E2%80%94Contingencies) 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 uncertainties**[132](index=132&type=chunk) [Note 11—Related Party Transactions](index=33&type=section&id=Note%2011%E2%80%94Related%20Party%20Transactions) 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 Distribution**[137](index=137&type=chunk)[139](index=139&type=chunk)[140](index=140&type=chunk) - **IAC** and **Vimeo Inc.** remain **related parties** **due to common beneficial ownership** by Mr. Diller, with certain **separation and commercial agreements** still in effect[142](index=142&type=chunk) - **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 periods[144](index=144&type=chunk)[146](index=146&type=chunk)[147](index=147&type=chunk) [Note 12—Discontinued Operations](index=35&type=section&id=Note%2012%E2%80%94Discontinued%20Operations) 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-Distribution**[150](index=150&type=chunk)[236](index=236&type=chunk) 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](index=37&type=page&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) 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](index=38&type=section&id=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 **Turo**[155](index=155&type=chunk) - 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 date[157](index=157&type=chunk) - 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, 2025[168](index=168&type=chunk)[169](index=169&type=chunk) [Results of Operations for the Three and Six Months Ended June 30, 2025 Compared to the Three and Six Months Ended June 30, 2024](index=43&type=section&id=Results%20of%20Operations%20for%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202025%20Compared%20to%20the%20Three%20and%20Six%20Months%20Ended%20June%2030%2C%202024) 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 digital**[172](index=172&type=chunk)[174](index=174&type=chunk) - **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 operations**[172](index=172&type=chunk)[174](index=174&type=chunk)[175](index=175&type=chunk) 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 EBITDA**[192](index=192&type=chunk)[194](index=194&type=chunk)[195](index=195&type=chunk) 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 accruals**[199](index=199&type=chunk) - **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 loss**[201](index=201&type=chunk)[202](index=202&type=chunk) - 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 2024[203](index=203&type=chunk) [Principles of Financial Reporting](index=56&type=section&id=PRINCIPLES%20OF%20FINANCIAL%20REPORTING) 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**)[215](index=215&type=chunk)[216](index=216&type=chunk) - 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 results**[215](index=215&type=chunk) [Financial Position, Liquidity and Capital Resources](index=61&type=section&id=FINANCIAL%20POSITION%2C%20LIQUIDITY%20AND%20CAPITAL%20RESOURCES) 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 **$262.7 million** of this cash, which **IAC may not freely access due to debt covenants**[228](index=228&type=chunk)[246](index=246&type=chunk) - **Net cash used in operating activities attributable to continuing operations** was **$(2.7) million** for H1 2025, a **decrease from $60.2 million provided** in H1 2024, primarily **due to changes in working capital and non-cash adjustments**[229](index=229&type=chunk)[230](index=230&type=chunk) - **Investing activities for continuing operations resulted in a net cash outflow** of **$(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 repurchases**[231](index=231&type=chunk)[232](index=232&type=chunk) - **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, 2025[241](index=241&type=chunk) - 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](index=244&type=chunk) - 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 capital**[249](index=249&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=63&type=page&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) 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 loss**[250](index=250&type=chunk)[251](index=251&type=chunk) - 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 effect**[252](index=252&type=chunk)[253](index=253&type=chunk)[254](index=254&type=chunk) [Item 4. Controls and Procedures](index=64&type=page&id=Item%204.%20Controls%20and%20Procedures) 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 CFO**[255](index=255&type=chunk) - **No material changes to the Company's internal control over financial reporting** occurred during the quarter ended June 30, 2025[256](index=256&type=chunk) 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](index=65&type=page&id=Item%201.%20Legal%20Proceedings) 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' standard**[264](index=264&type=chunk) - 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, 2025[266](index=266&type=chunk) [Item 1A. Risk Factors](index=66&type=page&id=Item%201A.%20Risk%20Factors) 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 occurred[270](index=270&type=chunk) - **Forward-looking statements are subject to various risks**, **including market conditions, Google policy changes, AI technology disruption, liquidity, and debt covenants**[268](index=268&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=67&type=page&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) 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 2025[271](index=271&type=chunk) 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 Authorization**[241](index=241&type=chunk) [Item 5. Other Information](index=69&type=page&id=Item%205.%20Other%20Information) 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, 2025[274](index=274&type=chunk) [Item 6. Exhibits](index=69&type=page&id=Item%206.%20Exhibits) 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](index=73&type=page&id=Signatures) This section contains the official certifications and signatures required for the submission of the Form 10-Q

[IAC Q2 2025 Financial Highlights](index=1&type=section&id=IAC%20Q2%202025%20Financial%20Highlights) [Overall Performance Summary](index=1&type=section&id=Overall%20Performance%20Summary) IAC's Q2 2025 revenue declined 7% to $586.9 million, yet profitability significantly improved with positive operating income and 15% Adjusted EBITDA growth, largely due to an MGM investment gain and People Inc.'s digital revenue growth Q2 2025 Financial Performance Summary | Metric | Q2 2025 | Q2 2024 | Growth | | :--- | :--- | :--- | :--- | | Revenue | $586.9M | $634.4M | -7% | | Operating income (loss) | $0.6M | ($21.5M) | NM | | Net earnings (loss) | $211.5M | ($142.2M) | NM | | Diluted earnings (loss) per share | $2.57 | ($1.71) | NM | | Adjusted EBITDA | $51.4M | $44.8M | 15% | - Dotdash Meredith has been rebranded as People Inc., leveraging its flagship brand, with Digital revenue growth accelerating to **9% in Q2 2025** from 7% in Q1 2025[2](index=2&type=chunk)[4](index=4&type=chunk) - IAC's Chairman, Barry Diller, expressed a strong appetite to deploy cash for stock buybacks or strategic acquisitions, despite quiet capital allocation in the quarter[3](index=3&type=chunk) - IAC holds a **24% stake in MGM Resorts International**, with **64.7 million shares valued at $2.3 billion** as of August 1, 2025[5](index=5&type=chunk)[14](index=14&type=chunk) [Discussion of Financial and Operating Results](index=3&type=section&id=Discussion%20of%20Financial%20and%20Operating%20Results) [Segment Performance Overview](index=3&type=section&id=Segment%20Performance%20Overview) IAC's Q2 2025 segment performance was mixed, with People Inc. showing modest revenue growth and strong operating income, while other segments faced revenue declines but mostly saw Adjusted EBITDA growth Q2 2025 Segment Performance | Segment | Revenue (Q2 2025) | Revenue Growth | Operating Income (Q2 2025) | Adjusted EBITDA (Q2 2025) | Adjusted EBITDA Growth | | :--- | :--- | :--- | :--- | :--- | :--- | | People Inc. | $427.4M | 1% | $34.8M | $69.6M | 5% | | Care.com | $82.0M | -6% | $3.0M | $5.8M | 117% | | Search | $61.7M | -39% | $5.1M | $5.1M | 10% | | Emerging & Other | $15.9M | -20% | ($9.2M) | ($6.3M) | 3% | | Corporate | N/A | N/A | ($33.1M) | ($22.8M) | -1% | [People Inc.](index=4&type=section&id=People%20Inc.) People Inc. revenue grew 1% to $427.4 million, driven by a 9% increase in Digital revenue, offsetting a Print decline, with operating income surging 90% due to lower amortization People Inc. Revenue by Stream | Revenue Stream | Q2 2025 | Q2 2024 | Growth | | :--- | :--- | :--- | :--- | | Digital | $260.4M | $238.1M | 9% | | Print | $173.5M | $191.7M | -9% | | **Total** | **$427.4M** | **$425.2M** | **1%** | - Digital revenue growth was driven by **Advertising (+5%)** from Health, Pharma, Tech, and Travel; **Performance Marketing (+14%)** fueled by 25% growth in affiliate commerce; and **Licensing (+23%)** benefiting from content syndication, Apple News+, and a new OpenAI partnership[8](index=8&type=chunk) - Digital operating income increased **46% to $38.1 million**, primarily due to lower amortization expenses as certain intangible assets became fully amortized in 2024, while Digital Adjusted EBITDA declined 1% due to higher costs and investments[9](index=9&type=chunk) [Care.com](index=6&type=section&id=Care.com) Care.com's revenue decreased 6% to $82.0 million due to declines in Consumer and Enterprise segments, yet operating income improved to $3.0 million, largely due to the absence of prior-year legal accruals - Revenue declined **6%** due to a **9% decrease in Consumer revenue** from lower platform subscriptions and a **4% decrease in Enterprise revenue** from lower product utilization[13](index=13&type=chunk) - Operating income turned positive to **$3.0 million**, and Adjusted EBITDA grew **117% to $5.8 million**, primarily due to the absence of a $9.5 million legal accrual present in Q2 2024[13](index=13&type=chunk) [Search](index=6&type=section&id=Search) The Search segment's revenue sharply declined **39% to $61.7 million** due to reduced traffic acquisition and desktop business declines, but operating income and Adjusted EBITDA both grew **10%** through cost management - Revenue fell **39%** due to a **39% decrease at Ask Media Group** and a **41% decrease at the Desktop business**, reflecting a strategic reduction in traffic acquisition[13](index=13&type=chunk) - Despite the revenue drop, operating income and Adjusted EBITDA increased by **10% to $5.1 million**, attributed to lower traffic acquisition and compensation costs[13](index=13&type=chunk) [Emerging & Other](index=6&type=section&id=Emerging%20%26%20Other) Emerging & Other segment revenue decreased **20% to $15.9 million**, primarily from lower IAC Films revenue, while the operating loss widened to **$9.2 million** due to higher stock-based compensation - The **20% revenue decline** was primarily caused by a **$4.7 million decrease in IAC Films revenue**, while Vivian Health revenue remained flat year-over-year, an improvement from Q1 2025[13](index=13&type=chunk) - Operating loss increased by **$2.4 million to $9.2 million**, reflecting **$2.6 million higher stock-based compensation expense**[13](index=13&type=chunk) [Corporate & Other Financial Items](index=7&type=section&id=Corporate%20%26%20Other%20Financial%20Items) Corporate operating loss narrowed to **$33.1 million** due to lower stock-based compensation, while a **$307.4 million unrealized gain** on the MGM investment significantly boosted pre-tax earnings, resulting in a **23% effective tax rate** - Corporate operating loss decreased by **$3.7 million**, mainly due to **$4.0 million lower stock-based compensation expense** related to a forfeited award from the former CEO[14](index=14&type=chunk)[16](index=16&type=chunk) - IAC's investment in MGM generated an unrealized gain of **$307.4 million in Q2 2025**, a significant reversal from the $179.3 million unrealized loss in Q2 2024[3](index=3&type=chunk)[14](index=14&type=chunk) - The company recorded an income tax provision of **$63.0 million**, resulting in an effective tax rate of **23%** for Q2 2025[15](index=15&type=chunk) [Financial Position and Cash Flow](index=8&type=section&id=Financial%20Position%20and%20Cash%20Flow) [Liquidity and Capital Resources](index=9&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, IAC held **$1.1 billion in cash**, with People Inc. refinancing **$1.47 billion of debt** to extend maturities, and **9.2 million shares** remaining for repurchase - As of June 30, 2025, the company had **$1.1 billion in cash and cash equivalents** and **$1.45 billion in long-term debt**, which is an obligation of People Inc[25](index=25&type=chunk) - People Inc. refinanced **$1.47 billion of debt**, extending maturities with new term loans and senior secured notes due in 2030 and 2032[22](index=22&type=chunk)[25](index=25&type=chunk) - IAC has **9.2 million shares** remaining in its share repurchase authorization as of August 1, 2025[24](index=24&type=chunk) [Free Cash Flow](index=8&type=section&id=Free%20Cash%20Flow) IAC's Free Cash Flow for the first six months of 2025 was negative **$11.8 million**, a significant decrease from **$53.8 million** in 2024, primarily due to unfavorable working capital changes and higher capital expenditures Six Months Ended June 30 Free Cash Flow | Metric (Six Months Ended June 30) | 2025 | 2024 | | :--- | :--- | :--- | | Net cash from operating activities | ($2.7M) | $60.2M | | Capital expenditures | ($9.1M) | ($6.4M) | | **Free Cash Flow** | **($11.8M)** | **$53.8M** | - The **$65.6 million year-over-year decrease in Free Cash Flow** was mainly driven by unfavorable working capital and higher capital expenditures, partially offset by higher Adjusted EBITDA[17](index=17&type=chunk) [Outlook](index=15&type=section&id=Outlook) [Full Year 2025 Outlook](index=15&type=section&id=Full%20Year%202025%20Outlook) IAC projects full-year 2025 total Adjusted EBITDA between **$247 million and $285 million** and operating income between **$82 million and $140 million**, with People Inc. as the primary contributor FY 2025 Outlook ($ in millions) | FY 2025 Outlook ($ in millions) | Guidance Range | | :--- | :--- | | **Adjusted EBITDA** | | | People Inc. | $330 - $340 | | Care.com | $45 - $55 | | Search | $12 - $15 | | Emerging & Other | ($25) - ($15) | | Corporate | ($115) - ($110) | | **Total Adjusted EBITDA** | **$247 - $285** | | **Total Operating income** | **$82 - $140** | [Q3 and FY 2025 Additional Observations](index=15&type=section&id=Q3%20and%20FY%202025%20Additional%20Observations) IAC anticipates Q3 2025 People Inc. Digital revenue growth of **7%-9%** with Adjusted EBITDA of **$68-$73 million**, while Care.com revenue is projected to decline **4%-7%** - **People Inc.:** Q3 Digital revenue growth expected at **7%-9%**; FY 2025 Digital revenue growth expected at **7%-10%**[40](index=40&type=chunk) - **Care.com:** Q3 revenue expected to decline **4%-7%** with Adjusted EBITDA of **$6-$10 million**, which includes a $3 million real estate impairment charge[40](index=40&type=chunk) - **Search:** Q3 revenue is guided to be **$55-$65 million** with Adjusted EBITDA of **$3-$4 million**[40](index=40&type=chunk) [Detailed Financials and Supplementary Information](index=10&type=section&id=Detailed%20Financials%20and%20Supplementary%20Information) [GAAP Financial Statements](index=12&type=section&id=GAAP%20Financial%20Statements) IAC's GAAP financial statements show a shift to net earnings driven by the MGM investment, total assets of **$7.4 billion**, and a **$703.8 million net decrease in cash** for the first six months of 2025 due to financing and investing activities [Consolidated Statement of Operations](index=12&type=section&id=Consolidated%20Statement%20of%20Operations) IAC's Q2 2025 revenue was **$586.9 million**, with operating income improving to **$0.6 million**, and net earnings of **$210.6 million** primarily driven by a **$307.4 million unrealized gain** on the MGM investment Consolidated Statement of Operations ($ in thousands) | ($ in thousands) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Revenue | $586,928 | $634,393 | | Operating income (loss) | $575 | ($21,489) | | Unrealized gain (loss) on investment in MGM | $307,437 | ($179,284) | | Net earnings (loss) from continuing operations | $210,633 | ($144,692) | | Diluted earnings (loss) per share | $2.57 | ($1.71) | [Consolidated Balance Sheet](index=13&type=section&id=Consolidated%20Balance%20Sheet) As of June 30, 2025, IAC's total assets were **$7.36 billion**, a decrease from year-end 2024 due to the Angi Inc. spin-off, with **$1.09 billion in cash** and **$1.41 billion in long-term debt** Consolidated Balance Sheet ($ in thousands) | ($ in thousands) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$7,360,395** | **$9,688,644** | | Cash and cash equivalents | $1,093,866 | $1,381,736 | | Investment in MGM | $2,225,844 | $2,242,672 | | Long-term debt, net | $1,412,332 | $1,435,007 | | **Total Liabilities and Shareholders' Equity** | **$7,360,395** | **$9,688,644** | [Consolidated Statement of Cash Flows](index=14&type=section&id=Consolidated%20Statement%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash used in operating activities was **$2.7 million**, investing activities used **$374.4 million** (Angi Inc. spin-off), and financing activities used **$298.7 million**, resulting in a **$703.8 million net decrease in cash** Consolidated Statement of Cash Flows ($ in thousands) | ($ in thousands) | Six Months Ended June 30, 2025 | | :--- | :--- | | Net cash (used in) provided by operating activities | ($2,691) | | Net cash (used in) provided by investing activities | ($374,421) | | Net cash used in financing activities | ($298,694) | | **Net (decrease) in cash and cash equivalents** | **($703,796)** | [Reconciliation of GAAP to Non-GAAP Measures](index=16&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Measures) This section details reconciliations of operating income to Adjusted EBITDA, showing Q2 2025 total operating income of **$0.6 million** reconciled to Adjusted EBITDA of **$51.4 million** by adding back stock-based compensation, depreciation, and amortization Q2 2025 GAAP to Non-GAAP Reconciliation | Reconciliation for Q2 2025 ($ in millions) | Amount | | :--- | :--- | | Total Operating income (loss) | $0.6 | | Stock-based Compensation Expense | $19.5 | | Depreciation | $8.0 | | Amortization of Intangibles | $23.4 | | **Total Adjusted EBITDA** | **$51.4** | [Operating Metrics](index=10&type=section&id=Operating%20Metrics) This section details key operating metrics, highlighting People Inc.'s **9% Digital revenue growth** driven by Performance Marketing and Licensing, alongside revenue declines for Care.com and Search segments People Inc. Digital Revenue Metrics | People Inc. Revenue ($M) | Q2 2025 | Growth | | :--- | :--- | :--- | | Advertising | $161.2 | 5% | | Performance marketing | $61.1 | 14% | | Licensing and other | $38.1 | 23% | | **Total Digital** | **$260.4** | **9%** | - People Inc.'s Total Sessions decreased **5% to 2,444 million**, but Core Sessions, representing its most significant sites, increased **2% to 2,202 million**[27](index=27&type=chunk) [Dilutive Securities](index=11&type=section&id=Dilutive%20Securities) As of August 1, 2025, IAC had **80.2 million absolute shares outstanding**, with total potential dilution from equity awards estimated at **1.3 million shares**, resulting in **81.5 million total diluted shares** - As of August 1, 2025, total potential dilution from RSUs and options is approximately **1.3 million shares**, leading to a total diluted share count of **81.5 million**[30](index=30&type=chunk) - The company settles all equity awards on a net basis, with a cash withholding tax obligation of **$72.5 million** if all awards were exercised or vested on August 1, 2025[31](index=31&type=chunk) [Supplementary Information](index=19&type=section&id=Supplementary%20Information) This section defines non-GAAP measures like Adjusted EBITDA and Free Cash Flow, provides detailed operating metric definitions for key segments, and includes a Safe Harbor statement regarding forward-looking statements - Adjusted EBITDA is defined as operating income excluding stock-based compensation, depreciation, and certain acquisition-related items, serving as the company's primary segment measure of profitability[47](index=47&type=chunk)[48](index=48&type=chunk) - Free Cash Flow is defined as net cash from operating activities less capital expenditures, representing the cash generated by operating businesses[49](index=49&type=chunk) - The report contains a Safe Harbor statement outlining numerous risks and uncertainties that could cause actual results to differ from forward-looking statements, including competition from generative AI, unstable market conditions, and debt-related risks[64](index=64&type=chunk)

Group 1 - IAC will release its second quarter results after market close on August 4, 2025, and will host a conference call on August 5, 2025, at 8:30 a.m. ET to discuss these results [1] - The conference call will be accessible to the public through the investor relations section of IAC's website [1] Group 2 - IAC is a company that builds and evolves businesses, guided by curiosity and a desire to innovate or acquire new products and brands [2] - The company has developed into 10 independent, publicly-traded companies and has a history of financially-disciplined opportunism [2] - IAC's current portfolio includes category-leading businesses such as Dotdash Meredith and Care.com, along with strategic equity positions in MGM Resorts International and Turo Inc. [2]

Core Insights - The article emphasizes the importance of in-depth research in the casino and gaming sector, highlighting the availability of resources for investors [1] Group 1: Industry Overview - The casino and gaming sector is characterized by significant operational complexities and investment opportunities, necessitating specialized research and insights [1] - The House Edge provides actionable research for investing in the casino, online betting, and entertainment industries, indicating a focus on value investment strategies [2] Group 2: Expert Background - Howard Jay Klein, with 30 years of experience in major casino operations, leads The House Edge and utilizes management quality as a key factor in investment decisions [2] - Klein's extensive intelligence network spans various levels within the US gambling and entertainment sectors, enhancing the depth of research and insights provided [2]