What changed in this filing

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Item 1A. Risk Factors

2021-02-25 compared with 2020-02-28 · 300 added, 427 removed, 10 unchanged (99% of the section changed)

Cautionary Statement Regarding Forward-Looking Information

This annual report on Form 10-K contains “forward‑looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995.

The use of words such as “anticipates,” “estimates,” “expects,” “plans” and “believes,” among others, generally identify forward-looking statements.

These forward-looking statements include, among others, statements relating to:

IAC’s future financial performance, IAC’s business prospects and strategy, including the separation of Match Group

from IAC, anticipated trends and prospects in the industries in which IAC’s businesses operate and other similar matters.

These forward-looking statements are based on IAC management's expectations and assumptions about future events as of the date of this annual report, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict.

Actual results could differ materially from those contained in these forward‑looking statements for a variety of reasons, including, among others, the risk factors set forth below.

Other unknown or unpredictable factors that could also adversely affect IAC’s business, financial condition and results of operations may arise from time to time.

In light of these risks and uncertainties, the forward‑looking statements discussed in this annual report may not prove to be accurate.

Accordingly, you should not place undue reliance on these forward-looking statements, which only reflect the views of IAC management as of the date of this annual report.

IAC does not undertake to update these forward‑looking statements.

Risks Related to Our Business and Operations

Our success depends, in substantial part, on our continued ability to market, distribute and monetize our products and services through search engines, digital app stores and social media platforms.

The marketing, distribution and monetization of our products and services depends on our ability to cultivate and maintain cost-effective and otherwise satisfactory relationships with search engines, digital app stores and social media platforms, in particular, those operated by Google, Apple and Facebook.

These platforms could decide not to market and distribute some or all of our products and services, change their terms and conditions of use at any time (and without notice), favor their own products and services over ours and/or significantly increase their fees.

While we expect to maintain cost-effective and otherwise satisfactory relationships with these platforms, no assurances can be provided that we will be able to do so and our inability to do so in the case of one or more of these platforms could have a material adverse effect on our business, financial condition and results of operations.

In particular, as consumers increasingly access our products and services through applications (both mobile and desktop), we (primarily in the case of our Match Group and Mosaic Group businesses) increasingly depend upon the Apple App Store and the Google Play Store to distribute our mobile and desktop browser applications.

Both Apple and Google have broad discretion to change their respective terms and conditions applicable to the distribution of our mobile applications, including those relating to the amount of (and requirement to pay) certain fees associated with purchases facilitated by Apple and Google through our mobile applications, their ability to interpret their respective terms and conditions in ways that may limit, eliminate or otherwise interfere with our ability to distribute applications through their stores, the features we may provide in our products and services, our ability to access information about our subscribers and users that they collect and the manner in which we market in-app products.

Apple or Google could also make changes to their operating systems or payment services that could negatively affect our businesses.

We cannot assure you that Apple or Google will not limit, eliminate or otherwise interfere with the distribution of our applications, the features we provide in our products and services, our ability to access information about our subscribers and users that they collect and the manner in which we market our in-app products.

Risks relating to our business

The dating industry is competitive, with low switching costs and a consistent stream of new products and entrants, and innovation by our competitors may disrupt our business.

The dating industry is competitive, with a consistent stream of new products and entrants.

Some of our competitors may enjoy better competitive positions in certain geographical regions, user demographics or other key areas that we currently serve or may serve in the future.

These advantages could enable these competitors to offer products that are more appealing to users and potential users than our products or to respond more quickly and/or cost-effectively than us to new or changing opportunities.

In addition, within the dating industry generally, costs for consumers to switch between products are low, and consumers have a propensity to try new approaches to connecting with people and to use multiple dating products at the same time.

As a result, new products, entrants and business models are likely to continue to emerge.

It is possible that a new product could gain rapid scale at the expense of existing brands through harnessing a new technology or a new or existing distribution channel, creating a new or different approach to connecting people or some other means.

Potential competitors include larger companies that could devote greater resources to the promotion or marketing of their products and services, take advantage of acquisition or other opportunities more readily or develop and expand their products and services more quickly than we do.

Potential competitors also include established social media companies that may develop products, features, or services that may compete with ours or operators of mobile operating systems and app stores.

For example, Facebook has introduced a dating feature on its platform, which it has rolled out in North America and other markets and has stated it plans to roll out globally.

These social media and mobile platform competitors could use strong or dominant positions in one or more markets, and ready access to existing large pools of potential users and personal information regarding those users, to gain competitive advantages over us, including by offering different product features or services that users may prefer or offering their products and services to users at no charge, which may enable them to acquire and engage users at the expense of our user growth or engagement.

If we are not able to compete effectively against our current or future competitors and products that may emerge, the size and level of engagement of our user base may decrease, which could have an adverse effect on our business, financial condition and results of operations.

The limited operating history of our newer brands and products makes it difficult to evaluate our current business and future prospects.

We seek to tailor each of our brands and products to meet the preferences of specific communities of users.

Building a given brand or product is generally an iterative process that occurs over a meaningful period of time and involves considerable resources and expenditures.

Although certain of our newer brands and products have experienced significant growth over relatively short periods of time, the historical growth rates of these brands and products may not be an indication of future growth rates for such products or our newer brands and products generally.

We have encountered, and may continue to encounter, risks and difficulties as we build our newer brands and products.

The failure to successfully scale these brands and products and address these risks and difficulties could adversely affect our business, financial condition and results of operations.

Our growth and profitability rely, in part, on our ability to attract and retain users through cost-effective marketing efforts.

Any failure in these efforts could adversely affect our business, financial condition, and results of operations.

Attracting and retaining users for our products involve considerable expenditures for online and offline marketing.

Historically, we have had to increase our marketing expenditures over time in order to attract and retain users and sustain our growth.

Evolving consumer behavior can affect the availability of profitable marketing opportunities.

For example, as traditional television viewership declines and as consumers spend more time on mobile devices rather than desktop computers, the reach of many of our traditional advertising channels continues to contract.

Similarly, as consumers communicate less via email and more via text messaging, messaging apps and other virtual means,

the reach of email campaigns designed to attract new and repeat users (and retain current users) for our products is adversely impacted.

Additionally, changes proposed by large tech platforms, such as Apple and Google, to advertisers’ ability to access and use unique advertising identifiers, cookies and other information to acquire potential users, may adversely impact our advertising efforts.

To continue to reach potential users and grow our businesses, we must identify and devote more of our overall marketing expenditures to newer advertising channels, such as mobile and online video platforms.

Generally, the opportunities in and sophistication of newer advertising channels and methods continue to be less developed, proven and precise, making it more difficult to assess returns on investment associated with our advertising efforts and to cost-effectively identify potential users.

There can be no assurance that we will be able to continue to appropriately manage our marketing efforts in response to these and other trends in the advertising industry.

Any failure to do so could adversely affect our business, financial condition and results of operations.

Our business and results of operations have been and may continue to be adversely affected by the recent COVID-19 outbreak or other similar outbreaks.

Our business could be materially and adversely affected by the outbreak of a widespread health epidemic or pandemic, including the Coronavirus Disease 2019 (COVID-19) pandemic.

The COVID-19 pandemic has reached across the globe, resulting in the implementation of significant governmental measures intended to control the spread of the virus, including lockdowns, closures, quarantines, and travel bans, as well as changes in consumer behavior as individuals have become reluctant to engage in social activities with people outside their households.

While some of these measures have been relaxed in certain parts of the world, ongoing and future prevention and mitigation measures, as well as the potential for some of these measures to be reinstituted in the event of repeat waves of the virus, are likely to have an adverse impact on global economic conditions and consumer confidence and spending, and could materially adversely affect demand, or users’ ability to pay, for our products and services.

A public health epidemic, including COVID-19, poses the risk that Match Group or its employees, contractors, vendors, and other business partners may be prevented or impaired from conducting ordinary course business activities for an indefinite period of time, including due to shutdowns necessitated for the health and wellbeing of our employees, the employees of business partners, or shutdowns that may be requested or mandated by governmental authorities.

For example, early on in the pandemic, certain of our customer support vendors were impacted by government mandated shutdowns which adversely impacted the capability of the affected brands to respond timely and effectively to user inquiries and requests.

In addition, in response to the COVID-19 outbreak, we have taken several precautions that may adversely impact employee productivity, such as continuing to allow employees to work remotely, imposing travel restrictions, and ongoing closures of office locations.

The ultimate extent of the impact of any epidemic, pandemic, or other health crisis on our business will depend on multiple factors that are highly uncertain and cannot be predicted, including its severity, location and duration, and actions taken to contain or prevent further its spread.

Additionally, the COVID-19 pandemic could increase the magnitude of many of the other risks described in this annual report, and have other adverse effects on our operations that we are not currently able to predict.

If our business and the markets in which we operate experience a prolonged occurrence of adverse public health conditions, such as COVID-19, it could materially and adversely affect our business, financial condition, and results of operations.

See “Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Trends affecting our business—Impacts of the Coronavirus.”

Foreign currency exchange rate fluctuations could adversely affect our results of operations.

We operate in various international markets, including jurisdictions within the European Union (which we refer to as the “EU”) and Asia.

During periods of a strengthening U.S.

dollar, our international revenues will be reduced when translated into U.S.

In addition, as foreign currency exchange rates fluctuate, the translation of our international revenues into U.S.

dollar-denominated operating results affects the period-over-period comparability of such results and can result in foreign currency exchange gains and losses.

The departure of the United Kingdom from the European Union, commonly referred to as “Brexit,” has caused, and may continue to cause, volatility in currency exchange rates between the U.S.

dollar and the British Pound and the full impact of Brexit remains uncertain.

See ‘‘Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations—Principles of Financial Reporting—Effects of Changes in Foreign

Exchange Rates on Revenue,“ and Item 7A—Quantitative and Qualitative Disclosures About Market Risk—Foreign Currency Exchange Risk.”

Distribution and marketing of, and access to, our products relies, in significant part, on a variety of third-party platforms, in particular, mobile app stores.

If these third parties limit, prohibit, or otherwise interfere with or change their policies in any material way, it could adversely affect our business, financial condition, and results of operations.

We market and distribute our products (including related mobile applications) through a variety of third-party distribution channels, including Facebook, which has rolled out its own dating product.

Our ability to market our brands on any given property or channel is subject to the policies of the relevant third party.

Certain platforms and channels have, from time to time, limited or prohibited advertisements for our products for a variety of reasons, including poor behavior by other industry participants.

There is no assurance that we will not be limited or prohibited from using certain marketing channels in the future.

If this were to happen with a significant marketing channel and/or for a significant period of time, our business, financial condition and results of operations could be adversely affected.

Additionally, our mobile applications are almost exclusively accessed through the Apple App Store and Google Play Store.

Both Apple and Google have broad discretion to change their policies regarding their mobile operating systems and app stores in ways that may limit, eliminate or otherwise interfere with our ability to distribute or market our applications through their stores, our ability to update our applications, including to make bug fixes or other feature updates or upgrades, the features we provide, our ability to access native functionality or other aspects of mobile devices, and our ability to access information about our users that they collect.

To the extent either or both of them do so, our business, financial condition and results of operations could be adversely affected.

In addition, the use of certain of our products and services also depends, in part, on social media platforms.

For example, many users of Match Group’s Tinder, Hinge and certain other dating products historically registered for (and logged into) these dating products exclusively through their Facebook profiles.

While Match Group launched an alternate authentication method that allows users to register for (and log into) Tinder, Hinge and other affected products using their mobile phone number, no assurances can be provided that users will no longer register for (and log into) these products through their Facebook profiles.

Facebook has broad discretion to change its terms and conditions applicable to the data collected by its platform (and the use of such data) and to interpret its terms and conditions in ways that could limit, eliminate or otherwise interfere with our ability to use Facebook as an authentication method or to allow Facebook to use such data to gain a competitive advantage.

If any such event were to occur, our, business, financial condition and results of operations could be adversely affected.

Our success depends, in part, upon the continued migration of certain markets and industries online and the continued growth and acceptance of online products and services as effective alternatives to traditional offline products and services.

Through our various businesses, we provide a variety of online products and services that continue to compete with their traditional offline counterparts.

We believe that the continued growth and acceptance of online products and services generally will depend, to a large extent, on the continued growth in commercial use of the Internet (particularly abroad) and the continued migration of traditional offline markets and industries online.

For example, the success of the businesses within our Match Group segment depends, in substantial part, on the continued migration of the dating market online, our ability to continue to provide dating products that users find more efficient, effective, comfortable and convenient relative to traditional means of meeting people and the continued erosion of stigma surrounding online dating (particularly in emerging markets and other parts of the world).

If for any reason the dating market does not continue to migrate online as quickly as (or at lower levels than) we expect and/or a meaningful number of users do not embrace our dating products (and/or return to offline dating products and services), our business, financial condition and results of operations could be adversely affected.

Similarly, the success of the businesses within our ANGI Homeservices segment and our Care.com business depends, in substantial part, on the continued migration of the home services and care-related services markets online.

If for any reason these markets do not migrate online as quickly as (or at lower levels than) we expect and consumers and service professionals (and members and caregivers) continue, in large part, to rely on traditional offline efforts to connect with one another, our business, financial condition and results of operations could be adversely affected.

Lastly, as it relates to our advertising-supported businesses, our success also depends, in part, on our ability to compete for a share of available advertising expenditures as more traditional offline and emerging media companies continue to enter the online advertising market, as well as on the continued growth and acceptance of online advertising generally.

If for any reason online advertising is not perceived as effective (relative to traditional advertising) and related mobile and other advertising models are not accepted, web browsers, software programs and/or other applications that limit or prevent advertising from being displayed become commonplace and/or the industry fails to effectively manage click fraud, the market for online advertising will be negatively impacted.

Any lack of growth in the market for online advertising could adversely affect our business, financial condition and results of operations.

Marketing efforts designed to drive visitors to our various brands and businesses may not be successful or cost-effective.

Traffic building and conversion initiatives involve considerable expenditures for online and offline advertising and marketing.

We have made, and expect to continue to make, significant expenditures for search engine marketing (primarily in the form of the purchase of keywords, which we purchase primarily through Google and, to a lesser extent, Microsoft and Yahoo!), online display advertising and traditional offline advertising (including television and radio campaigns) in connection with these initiatives, which may not be successful or cost-effective.

Historically, we have had to increase advertising and marketing expenditures over time in order to attract and convert consumers, retain users and sustain our growth.

Our ability to market our brands on any given property or channel is subject to the policies of the relevant third-party seller, publisher of advertising (including search engines and social media platforms with extraordinarily high levels of traffic and numbers of users) or marketing affiliate.

As a result, we cannot assure you that these parties will not limit or prohibit us from purchasing certain types of advertising (including the purchase by IAC of advertising with preferential placement), advertising certain of our products and services and/or using one or more current or prospective marketing channels in the future.

If a significant marketing channel took such an action generally, for a significant period of time and/or on a recurring basis, our business, financial condition and results of operations could be adversely affected.

In addition, if we fail to comply with the policies of third-party sellers, publishers of advertising and/or marketing affiliates, our advertisements could be removed without notice and/or our accounts could be suspended or terminated, any of which could adversely affect our business, financial condition and results of operations.

In addition, our failure to respond successfully to rapid and frequent changes in the pricing and operating dynamics of search engines, as well as changing policies and guidelines applicable to keyword advertising (which may be unilaterally updated by search engines without advance notice), could adversely affect both our paid search engine marketing efforts and free search engine traffic.

Such changes could adversely affect paid listings (both their placement and pricing), as well as the ranking of our brands and businesses within search results, any or all of which could increase our costs (particularly if free traffic is replaced with paid traffic) and adversely affect the effectiveness of our marketing efforts overall.

Evolving consumer behavior (specifically, increased consumption of media through digital means) can also affect the availability of cost-effective marketing opportunities.

To continue to reach consumers, engage with users and grow in this environment, we will need to identify and devote more of our overall marketing expenditures to newer digital advertising channels (such as online video and other digital platforms), as well as target consumers and users via these channels.

Since newer advertising channels are undeveloped and unproven relative to traditional channels (such as television), it could be difficult to assess returns on our related marketing investments, which could adversely affect our business, financial condition and results of operations.

Lastly, certain of our businesses also enter into various arrangements with third parties (including advertising agencies) to drive visitors to our various brands and businesses, which arrangements are generally more cost-effective than traditional marketing efforts.

If these businesses are unable to renew existing (and enter into new) arrangements of this nature, sales and marketing costs as a percentage of revenue would increase over the long-term, which could adversely affect our business, financial condition and results of operations.

In addition, the quality and convertibility of traffic and leads generated through third-party arrangements are dependent on many factors, most of which are outside our control.

If the quality and/or convertibility of traffic and leads do not meet the expectations of the users of our various products and services, our paid listings providers and/or advertisers, our business, financial condition and results of operations could be adversely affected.

Our brands and businesses operate in especially competitive and evolving industries.

The industries in which our brands and businesses operate are competitive, with a consistent and growing stream of new products and entrants.

Some of our competitors may enjoy better competitive positions in certain geographical areas, user demographics and/or other key areas that we currently serve or may serve in the future.

Generally (and particularly in the case of the businesses within our Match Group and ANGI Homeservices segments), we compete with social media platforms with access to large existing pools of potential users and their personal information, which means these platforms can drive visitors to their products and services, as well as better tailor products and service to individual users, at little to no cost relative to our efforts.

For example, our dating business competes with Facebook, which introduced a dating feature on its platform that it has rolled out in North America and certain other markets and has stated it plans to roll out globally.

We also compete generally with search engine providers and online marketplaces that can market their products and services online in a more prominent and cost-effective manner than we can.

Any of these advantages could enable our competitors to offer products and services that are more appealing to consumers than our products and services, respond more quickly and/or cost effectively than we do to evolving market opportunities and trends and/or display their own integrated or related products and services in a more prominent manner than our products and services in search results, which could adversely affect our business, financial condition and results of operations.

In addition, costs to switch among products and services are low or non-existent and consumers generally have a propensity to try new products and services (and use multiple products and services simultaneously).

As a result, we expect the continued emergence of new products and services, entrants and business models in the various industries in which our brands and businesses operate.

Our inability to compete effectively against new products, services and competitors could result in decreases in the size and levels of engagement of our various user and subscriber bases, which could adversely affect our business, financial condition and results of operations.

We rely on Internet search engines to drive traffic to our various properties.

Certain operators of search engines offer products and services that compete directly with our products and services.

If links to websites offering our products and services are not displayed prominently in search results, traffic to our properties could decline and our business could be adversely affected.

In addition to paid marketing, we rely heavily on Internet search engines, such as Google, to drive traffic to our properties through their unpaid search results.

Although search results have allowed us to attract a large audience with low organic traffic acquisition costs in the past, if they fail to continue to drive sufficient traffic to our properties, we may need to increase our marketing spend to acquire additional traffic.

We cannot assure you that the value we ultimately derive from any such additional traffic would exceed the cost of acquisition, and any increase in marketing expense may in turn harm our operating results.

The amount of traffic we attract from search engines is due in large part to how and where information from (and links to websites offering our products and services) are displayed on search engine results pages.

The display, including rankings, of unpaid search results can be affected by a number of factors, many of which are not in our direct control, and may change frequently.

Search engines have made changes in the past to their ranking algorithms, methodologies and design layouts that have reduced the prominence of links to websites offering our products and services, and negatively impacted traffic to such websites, and we expect that search engines will continue to make such changes from time to time in the future.

However, we may not know how (or otherwise be in a position) to influence actions of this nature taken by search engines.

With respect to search results in particular, even when search engines announce the details of their methodologies, their parameters may change from time to time, be poorly defined or be inconsistently interpreted.

In addition, in some instances, search engines may change their displays or rankings in order to promote their own competing products or services, or the products or services of one or more of our competitors.

Any such action could negatively impact the search rankings of links to websites offering our products and services, or the prominence with which such links appear in search results.

Our success depends on the ability of our products and services to maintain a prominent position in search results, and in the event operators of search engines promote their own competing products in the future in a manner that

has the effect of reducing the prominence or ranking of our products and services, our business, financial condition and results of operations could be adversely affected.

Our success depends, in part, on our ability to build, maintain and/or enhance our various brands.

Through our various businesses, we own and operate a number of widely known consumer brands with strong brand appeal and recognition within their respective markets and industries, as well as a number of emerging brands that we are in the process of building.

We believe that our success depends, in large part, on our continued ability to maintain and enhance our established brands, as well as build awareness of (and loyalty to) our emerging brands.

Events that could adversely impact our brands and brand-building efforts include (among others):

product and service quality concerns, consumer complaints and lawsuits, ineffective advertising, inappropriate and/or unlawful actions taken by users, service professionals and caregivers, actions taken by governmental or regulatory authorities, data protection and security breaches and related bad publicity.

The occurrence or any of these events could, in turn, adversely affect our business, financial condition and results of operations.

Our success depends, in part, on our ability to continue to develop and monetize versions of our products and services for mobile and other digital devices.

As consumers increasingly access our products and services through mobile and other digital devices (including through digital voice assistants), we will need to continue to devote significant time and resources to ensure that our products and services are accessible across these platforms (and multiple platforms generally).

If we do not keep pace with evolving online, market and industry trends (including the introduction of new and enhanced digital devices and changes in the preferences and needs of our users and consumers generally), offer new and/or enhanced products and services in response to such trends that resonate with consumers, monetize products and services for mobile and other digital devices as effectively as our traditional products and services and/or maintain related systems, technology and infrastructure in an efficient and cost-effective manner, our business, financial condition and results of operations could be adversely affected.

In addition, the success of our mobile and other digital products and services depends on their interoperability with various third-party operating systems, technology, infrastructure and standards, over which we have no control.

Any changes to any of these things that compromise the quality or functionality of our mobile and digital products and services could adversely affect their usage levels and/or our ability to attract consumers and advertisers, which could adversely affect our business, financial condition and results of operations.

Our brands and businesses are sensitive to general economic events or trends, particularly those that adversely impact advertising spending levels and consumer confidence and spending behavior.

A significant portion of our consolidated revenue (and a substantial portion of our net cash from operations that we can freely access), is attributable to online advertising, primarily revenue from our Dotdash and Applications segments and our Ask Media Group business.

Accordingly, events and trends that result in decreased advertising expenditures and/or levels of consumer confidence and discretionary spending could adversely affect our business, financial condition and results of operations.

Similarly, the businesses within our ANGI Homeservices segment are particularly sensitive to events and trends that could result in consumers delaying or foregoing home services projects and/or service professionals being less likely to pay for consumer matches and Marketplace subscriptions, which could result in decreases in Marketplace service requests and directory searches.

Any such decreases could result in turnover at the Marketplace and/or in any of our directories, adversely impact the number and quality of service professionals at the Marketplace and in our directories and/or adversely impact the reach of (and breath of services offered through) the Marketplace and our directories, any or all of which could adversely affect our business, financial condition and results of operations.

Our ability to communicate with our users, subscribers and consumers via e-mail (or other sufficient means) is critical to our success .

As consumers increasingly communicate via mobile and other digital devices and messaging and social media apps, usage of e-mail (particularly among younger consumers) has declined and we expect this trend to continue.

In addition, deliverability and other restrictions could limit or prevent our ability to send e-mails to users, subscribers and consumers.

A continued and significant erosion in our ability to communicate with users, subscribers and consumers via e-mail could adversely impact the user experience, engagement levels and conversion rates, which could adversely affect our business, financial condition and results of operations.

We cannot assure you that any alternative means of communication (for example, push notifications and text messaging) will be as effective as e-mail has been historically.

Our success depends, in part, on our ability to access, collect and use personal data about our users and subscribers.

We depend on search engines, digital app stores and social media platforms, in particular, those operated by Google, Apple and Facebook, to market, distribute and monetize our products and services.

Our subscribers and users engage with these platforms directly, and in the case of digital app stores, may be subject to requirements regarding the use of their payment systems for various transactions.

As a result, these platforms may receive personal data about our users and subscribers that we would otherwise receive if we transacted with our users and subscribers directly.

Certain of these platforms have restricted our access to personal data about our users and subscribers obtained through their platforms.

If these platforms limit or increasingly limit, eliminate or otherwise interfere with our ability to access, collect and use personal data about our users and subscribers that they have collected, our ability to identify and communicate with a meaningful portion of our user and subscriber bases may be adversely impacted.

If so, our customer relationship management efforts, our ability to identify, target and reach new segments of our user and subscriber bases and the population generally, the efficiency of our paid marketing efforts, the rates we are able to charge advertisers seeking to reach users and subscribers on our various properties and our ability to develop and implement safety features, policies and procedures for certain of our products and services could be adversely affected.

We cannot assure you that search engines, digital app stores and social media platforms upon which we rely will not limit or increasingly limit, eliminate or otherwise interfere with our ability to access, collect and use personal data about our users and subscribers that they have collected.

To the extent that any or all of them do so, our business, financial condition and results of operations could be adversely affected.

We may need to offset increasing digital app store fees by decreasing traditional marketing expenditures, increasing user volume or monetization per user or by engaging in other efforts to increase revenue or decrease costs generally .

We increasingly rely upon the Apple App Store and the Google Play Store to distribute the mobile applications of our various businesses.

While some of our mobile applications are generally free to download from these stores, many of our mobile applications (primarily our dating and Mosaic Group applications) are subscription-based and/or offer in-app à la carte features for a fee.

We determine the prices at which these subscriptions and à la carte features are sold;

however, all related purchases must be processed through the in-app payment systems provided by Apple and, to a lesser extent, Google.

As a result, we pay Apple and Google, as applicable, a meaningful share (generally 30%, and in the case of subscription-based products, 30% for the first twelve months of a subscription and 15% thereafter) of the revenue we receive from these transactions.

While we are constantly innovating on and creating our own payment systems and methods, given the increasing distribution of our mobile applications through digital app stores and strict in-app payment system requirements, we may need to offset these increased digital app store fees by decreasing traditional marketing expenditures as a percentage of revenue, increasing user volume or monetization per user or engaging in other efforts to increase revenue or decrease costs generally, or our business, financial condition and results of operations could be adversely affected.

Additionally, to the extent Google changes its terms and conditions or practices to require us to process purchases of subscriptions and à la carte features through its in-app payment system, our business, financial condition and results of operations could be adversely affected.

Our success depends, in part, of the ability of ANGI Homeservices and Care.com to establish and maintain relationships with quality service professionals and caregivers.

We will need to continue to attract, retain and grow the number of skilled and reliable service professionals who can provide home services across ANGI Homeservices platforms and caregivers who can provide care-related services across Care.com platforms.

If we do not offer innovative products and services that resonate with consumers and service professionals (and members and caregivers) generally, as well provide service professionals and caregivers with an attractive return on their marketing and advertising investments, the number of service professionals and caregivers affiliated with ANGI Homeservices and Care.com platforms, respectively, would decrease.

Any such decrease would result in smaller and less diverse networks and directories of service professionals and caregivers, and in turn, decreases in service requests, directory searches and member requests for caregivers, which could adversely impact our business, financial condition and results of operations.

We depend upon arrangements with Google.

A meaningful portion of our consolidated revenue (and a substantial portion of our net cash from operations that we can freely access) is attributable to a services agreement with Google.

Pursuant to this agreement, we display and syndicate paid listings provided by Google in response to search queries generated by users of our Applications and Ask Media Group properties.

In exchange for making our search traffic available to Google, we receive a share of the revenue generated by the paid listings supplied to us, as well as certain other search‑related services.

Our current agreement with Google expires on March 31, 2020.

In February 2019, we amended this agreement, effective as of April 1, 2020, to extend the expiration date of our agreement to March 31, 2023;

provided, however, that beginning September 2020 and each September thereafter, we or Google may, after discussion with the other party, terminate the services agreement, effective on September 30 of the year

following the year such notice is given.

We believe that the amended agreement, taken as a whole, is comparable to our current agreement with Google.

The amount of revenue we receive from Google depends on a number of factors outside of our control, including the amount Google charges for advertisements, the efficiency of Google’s system in attracting advertisers and serving up paid listings in response to search queries and parameters established by Google regarding the number and placement of paid listings displayed in response to search queries.

In addition, Google makes judgments about the relative attractiveness (to advertisers) of clicks on paid listings from searches performed on our properties and these judgments factor into the amount of revenue we receive.

Google also makes judgments about the relative attractiveness (to users) of paid listings from searches performed on our properties and these judgments factor into the number of advertisements we can purchase.

Changes to the amount Google charges advertisers, the efficiency of Google’s paid listings network, Google's judgment about the relative attractiveness to advertisers of clicks on paid listings from our properties or to the parameters applicable to the display of paid listings generally could result in a decrease in the amount of revenue we receive from Google and could adversely affect our business, financial condition and results of operations.

We have experienced such changes in the past and such changes could come about in the future for a number of reasons, including general market conditions, competition or policy and operating decisions made by Google.

In the past, Google has made changes to its policies under our services agreement, as well as made industry-wide changes to its policies and practices, that have negatively impacted our Desktop and Ask Media Group businesses.

Our services agreement with Google also requires that we comply with certain guidelines for the use of Google brands and services, including the Chrome browser and Chrome Web Store.

These guidelines govern which of our products and applications may access Google services or be distributed through its Chrome Web Store, and the manner in which Google’s paid listings are displayed within search results across various third-party platforms and products (including our properties).

Our services agreement also requires that we establish guidelines to govern certain activities of third parties to whom we syndicate paid listings, including the manner in which these parties drive search traffic to their websites and display paid listings.

Google may generally unilaterally update its policies and guidelines without advance notice, which could in turn require modifications to, prohibit and/or render obsolete certain of our products, services and/or business practices or impair the distribution of some of our products and services, any of which could be costly to address or otherwise adversely affect our business, financial condition and results of operations.

Google has made changes in the past that have adversely affected our results of operations and may do so again in the future.

Noncompliance with Google’s guidelines by us or the third parties to whom we are permitted to syndicate paid listings or through which we secure distribution arrangements for certain of our Applications and Ask Media Group properties could, if not cured, result in the suspension of some or all Google services to our properties (or the websites of our third-party partners) and/or the termination of the services agreement by Google.

The termination of the services agreement by Google, the curtailment of our rights under the agreement, including the failure to allow our products to access Google services (whether pursuant to the terms thereof or otherwise), and/or the failure of Google to perform its obligations under the agreement would have an adverse effect on our business, financial condition and results of operations.

If any of these events were to occur, we may not be able to find another suitable alternate provider of paid listings (or if an alternate provider were found, the economic and other terms of the agreement and the quality of paid listings may be inferior relative to our arrangements with, and the paid listings supplied by, Google) or otherwise replace the lost revenues.

Foreign currency exchange rate fluctuations could adversely affect us.

We operate in various foreign markets, primarily in various jurisdictions within the European Union, and as a result, are exposed to foreign exchange risk for both the Euro and British Pound (“GBP”).

During the fiscal years ended December 31, 2019 and 2018, approximately 35% and 34% of our total revenues, respectively, were international revenues.

We translate international revenues into U.S.

Dollar-denominated results.

As a result, as foreign currency exchange rates fluctuate, the translation of the statement of operations of our international businesses into U.S.

Dollars affects the period-over-period comparability of operating results.

We are also exposed to foreign currency exchange gains and losses to the extent we or our subsidiaries conduct transactions in, and/or have assets and/or liabilities that are denominated in, a currency other than the relevant entity's functional currency.

For details regarding exchange rates and foreign currency exchange gains and losses for the fiscal years ended December 31, 2019 and 2018, see “Item 7A - Quantitative and Qualitative Disclosures About Market Risk-Foreign Currency Exchange Risk.”

The exit from the European Union by the United Kingdom may cause disruptions to capital and currency markets worldwide, and the full impact of this event remains uncertain.

The exit from the European Union by the United Kingdom could result in exchange rate and other market and economic volatility, which could adversely affect our operating results.

We have not hedged foreign currency exposures historically given that related gains or losses were not material to the Company.

As we continue to grow and expand our international operations, our exposure to foreign exchange rate fluctuations will increase and if significant, could adversely affect our business, financial condition and results of operations.

We may not be able to protect our systems, technology and infrastructure from cyberattacks and cyberattacks experienced by third parties may adversely affect us.

We are regularly under attack by perpetrators of malicious technology-related events, such as the use of botnets, malware or other destructive or disruptive software, distributed denial of service attacks, phishing, attempts to misappropriate user information and account login credentials and other similar malicious activities.

The incidence of events of this nature (or any combination thereof) is on the rise worldwide.

While we continuously develop and maintain systems designed to detect and prevent events of this nature from impacting our systems, technology, infrastructure, products, services and users, have invested (and continue to invest) heavily in these efforts and related personnel and training and deploy data minimization strategies (where appropriate), these efforts are costly and require ongoing monitoring and updating as technologies change and efforts to overcome preventative security measures become more sophisticated.

Despite these efforts, some of our systems have experienced past security incidents, none of which had a material adverse effect on our business, financial condition and results of operations, and we could experience significant events of this nature in the future.

Any event of this nature that we experience could damage our systems, technology and infrastructure and/or those of our users, prevent us from providing our products and services, compromise the integrity of our products and services, damage our reputation, erode our brands and/or be costly to remedy, as well as subject us to investigations by regulatory authorities, fines and/or litigation that could result in liability to third parties.

Even if we do not experience such events firsthand, the impact of any such events experienced by third parties could have a similar effect.

We may not have adequate insurance coverage to compensate for losses resulting from any of these events.

If we (or any third-party with whom we do business or otherwise rely upon) experience(s) an event of this nature, our business, financial condition and results of operations could be adversely affected.

If personal, confidential or sensitive user information that we maintain and store is breached or otherwise accessed by unauthorized persons, it may be costly to mitigate and our reputation could be harmed.

We receive, process, store and transmit a significant amount of personal, confidential or sensitive user information and, in the case of certain of our products and services, enable users to share their personal information with each other.

While we continuously develop and maintain systems designed to protect the security, integrity and confidentiality of this information, we cannot guarantee that inadvertent or unauthorized use or disclosure will not occur or that third parties will not gain unauthorized access to this information.

When such events occur, we may not be able to remedy them, we may be required by law to notify regulators and impacted individuals and it may be costly to mitigate the impact of such events and to develop and implement protections to prevent future events of this nature from occurring.

When breaches of security (ours or that of any third-party we engage to store information) occur, we could face governmental enforcement actions, significant fines, litigation (including consumer class actions) and the reputation of our brands and business could be harmed, any or all of which could adversely affect our business, financial condition and results of operations.

In addition, if any of the search engines, digital app store or social media platform through which we market, distribute and monetize our products and services were to experience a breach, third parties could gain unauthorized access to personal data about our users and subscribers, which could indirectly harm the reputation of our brands and businesses and in turn, adversely affect our business, financial condition and results of operations.

See also “-The processing, storage, use and disclosure of personal data could give rise to liabilities and increased costs.”

Credit card data security breaches or fraud that we or third parties experience could adversely affect us.

Certain of our businesses accept payment (including recurring payments) via credit and debit cards and certain online payment service providers.

The ability of these businesses to access payment information on a real time‑basis without having to proactively reach out to users to process payments is critical to our success.

When we or a third party (including credit card processing companies, as well as any business that offers products and services online or offline generally) experience a data security breach involving credit card information, affected cardholders will often cancel their cards.

In the case of a breach experienced by a third-party, the more sizable the third-party’s customer base, the greater the number of accounts impacted and the more likely it is that our users would be impacted by such a breach.

If such a breach impacts our users, we would need to contact affected users to obtain new payment information.

It is likely that we would not be able to reach all users impacted by the breach, and even if we could, new payment information for some users

may not be obtained and pending transactions may not be processed, which could adversely affect our business, financial condition and results of operations.

Even if our users are not directly impacted by a given data security breach, they may lose confidence in the ability of providers of online products and services to protect their personal information generally.

As a result, they may stop using their credit cards online and choose alternative payment methods that are not as convenient for IAC or restricts our ability to process payments without significant effort, which could adversely affect our business, financial condition and results of operations.

If we fail to prevent credit card data security breaches and fraudulent credit card transaction, we could face litigation, governmental enforcement actions, fines, civil liability, diminished public perception of our security measures, higher credit card-related costs and substantial remediation costs, or credit card processors could cease doing business with ut, any of which could adversely affect our business, financial condition and results of operations.

The processing, storage, use and disclosure of personal data could give rise to liabilities and increased costs.

We receive, transmit and store a large volume of personal information and other user data in connection with the provision of online products and services, the processing of search queries and the display of advertising on our various properties.

The manner in which we share, store, use, disclose and protect this information is determined by the respective privacy and data security policies of our various businesses, as well as federal, state and foreign laws and regulations and evolving industry standards and practices, which are changing, and in some cases, inconsistent and conflicting and subject to differing interpretations.

In addition, new laws, regulations, standards and practices of this nature are proposed and adopted from time to time.

For example, a comprehensive European Union privacy and data protection reform, the General Data Protection Regulation (the “GDPR”), became effective in May 2018.

The GDPR, which applies to companies that are organized in the European Union or otherwise provide services to (or monitor) consumers who reside in the European Union, imposes significant penalties (monetary and otherwise) for non-compliance, as well as provides a private right of action for individual claimants.

The GDPR will continue to be interpreted by European Union data protection regulators, which may require that we make changes to our business practices, and could generate additional risks and liabilities.

The European Union is also considering an update to its Privacy and Electronic Communications Directive to impose stricter rules regarding the use of cookies.

In addition, in October 2015, the European Court of Justice invalidated the U.S.-EU Safe Harbor framework that had been in place since 2000 for the transfer of personal data from the European Economic Area (the “EEA”) to the United States.

Although U.S.

and European Union authorities reached a political agreement for the transfer of personal data from the EEA to the United States in February 2016 (the “EU-U.S.

Privacy Shield”), it is facing mounting legal challenges.

Certain of our businesses continue to rely on the EU-U.S.

Privacy Shield and it is unclear what effect these challenges will have on transfers of personal data from the EEA to the United States in reliance on this framework going forward.

If these businesses can no longer rely on the EU-U.S.

Privacy Shield in connection with the transfer of personal data from the EEA to the United States, they would need to make changes to their respective business practices to ensure compliance with the GDPR, which could be costly and adversely affect our business, financial condition and results of operations.

Also, the exit from the European Union by the United Kingdom could result in the application of new and conflicting data privacy and protection laws and standards to our operations in the United Kingdom and our handling of personal data of users located in the United Kingdom.

At the same time, many jurisdictions abroad in which we do business have already or are currently considering adopting privacy and data protection laws and regulations.

Moreover, multiple legislative proposals concerning privacy and the protection of user information are being considered by the U.S.

Congress and various U.S.

state legislatures (including those in Illinois, New York, Virginia and Washington).

state legislatures have already enacted privacy legislation, one of the strictest and most comprehensive of which is the California Consumer Privacy Act of 2018, which became effective January 1, 2020 (the “CCPA”).

The CCPA provides new data privacy rights for California consumers, including the right to know what personal information is being collected about them and how it is being used, as well as significant rights over the use of their personal information (including the right to have such information deleted and the right to object to the sale of such information) and new operational requirements for businesses (primarily providing consumers with enhanced privacy-related disclosures).

The CCPA restricts the ability of our businesses to use personal California user and subscriber information in connection with our various products, services and operations, which could adversely affect our business, financial condition and results of operations.

The CCPA also provides

consumers with a private right of action for security breaches, as well as provides for statutory damages of up to $750 per violation, with the California Attorney General maintaining authority to enforce the CCPA and seek civil penalties for intentional violations of the CCPA of up to $7,500 per violation.

In addition, a ballot initiative to address privacy matters has been filed with the Office of the California Attorney General, which is expected to be presented California voters in November 2020, could further restrict the ability of our businesses to use personal California user and subscriber information in connection with our various products, services and operations and/or impose additional operational requirements on our businesses, which could adversely affect our business, financial condition and results of operations.

Lastly, the Federal Trade Commission has also increased its focus on privacy and data security practices, as evidenced by the first-of-its-kind, $5 billion dollar fine against a social media platform for privacy violations.

While we believe that we comply with applicable privacy and data protection policies, laws and regulations and industry standards and practices in all material respects, we could still be subject to claims of non-compliance that we may not be able to successfully defend and/or significant fines and penalties.

Moreover, any non-compliance or perceived non-compliance by us (or any third-party we engage to store or process information) or any compromise of security that results in unauthorized access to (or use or transmission of) personal information could result in a variety of claims against us, including governmental enforcement actions, significant fines, litigation (including consumer class actions), claims of breach of contract and indemnity by third parties and adverse publicity.

When such events occur, our reputation could be harmed and the competitive positions of our various brands and businesses could be diminished, which could adversely affect our business, financial condition and results of operations.

Additionally, to the extent multiple U.S.

state-level (or European Union member-state level) laws are introduced with inconsistent or conflicting standards and there is no federal or European Union regulation to preempt such laws, compliance could be even more difficult to achieve and our potential exposure to the risks discussed above could increase.

Lastly, ongoing compliance with existing (and compliance with future) privacy and data protection laws worldwide could be costly.

The devotion of significant costs to compliance (versus to the development of products and services) could result in delays in the development of new products and services, us ceasing to provide problematic products and services in existing jurisdictions and us being prevented from introducing products and services in new and existing jurisdictions, any or all of which could adversely affect our business, financial condition and results of operations.

Our success depends, in part, on the integrity, quality, efficiency and scalability of our systems, technology and infrastructure, and those of third parties.

We rely on our systems, technology and infrastructure to perform well on a consistent basis.

From time to time in the past we have experienced (and in the future we may experience) occasional interruptions that make some or all of this framework and related information unavailable or that prevent us from providing products and services;

any such interruption could arise for any number of reasons.

We also rely on third-party data center service providers and cloud-based, hosted web service providers, as well as third-party computer systems and a variety of communications systems and service providers in connection with the provision of our products and services generally, as well as to facilitate and process certain payment and other transactions with users.

We have no control over any of these third parties or their operations.

The framework described could be damaged or interrupted at any time due to fire, power loss, telecommunications failure, natural disasters, acts of war or terrorism, acts of God and other similar events or disruptions.

Any event of this nature could prevent us from providing our products and services at all (or result in the provision of our products on a delayed or interrupted basis) and/or result in the loss of critical data.

While we and the third parties upon whom we rely have certain backup systems in place for certain aspects of our respective frameworks, none of our frameworks are fully redundant and disaster recovery planning is not sufficient for all eventualities.

In addition, we may not have adequate insurance coverage to compensate for losses from a major interruption.

When such damages, interruptions or outages occur, our reputation could be harmed and the competitive positions of our various brands and businesses could be diminished, any or all of which could adversely affect our business, financial condition and results of operations.

We also continually work to expand and enhance the efficiency and scalability of our framework to improve the consumer experience, accommodate substantial increases in the number of visitors to our various platforms, ensure acceptable load times for our various products and services and keep up with changes in user preferences.

If we do not do so in a timely and cost-effective manner, the user experience and demand across our brands and businesses could be adversely affected, which could adversely affect our business, financial condition and results of operations.

Diller and certain members of his family are able to exercise significant influence over the composition of our Board of Directors, matters subject to stockholder approval and our operations.

As of the date of this report, Mr.

Diller, his spouse, Diane von Furstenberg, and his stepson, Alexander von Furstenberg, collectively beneficially owned shares of Class B common stock and common stock that represented approximately 42.5% of the total outstanding voting power of IAC (based on the number of shares of IAC common stock outstanding on January 31, 2020).

For details regarding the IAC securities beneficially owned by Mr.

Von Furstenberg and Mr.

Von Furstenberg, see “Item 1-Business-Equity Ownership and Vote.”

As a result of shares of Class B common stock and common stock beneficially owned by these individuals, they are, collectively, currently in a position to influence, subject to our organizational documents and Delaware law, the composition of IAC’s Board of Directors and the outcome of corporate actions requiring shareholder approval, such as mergers, business combinations and dispositions of assets, among other corporate transactions.

In addition, this concentration of investment and voting power could discourage others from initiating a potential merger, takeover or other change of control transaction that may otherwise be beneficial to IAC and its shareholders, which could adversely affect the market price of IAC securities.

For example, Apple has indicated that in the future it will require app users to opt in before their identifier for advertisers (“IDFA”) can be accessed by an app (which is currently expected to come into effect in 2021).

As a consequence, the ability of advertisers to accurately target and measure their advertising campaigns at the user level may become significantly limited and we and other app developers may experience increased cost per registration.

Additionally, Apple and Google are known to retaliate against app developers who publicly or privately challenge their app store rules and policies, and such retaliation has and could adversely affect our business, financial condition and results of operations.

The success of our products will depend, in part, on our ability to access, collect, and use personal data about our users and subscribers.

We rely on the Apple App Store and Google Play Store to distribute and monetize our mobile applications.

Our users and subscribers engage with these platforms directly and may be subject to requirements regarding the use of their payment systems for various transactions.

As a result of this disintermediation, these platforms receive and do not share with us key user data that we would otherwise receive if we transacted with our users and subscribers directly.

If these platforms continue to or increasingly limit, eliminate, or otherwise interfere with our ability to access, collect, and use key user data, our ability to identify and communicate with a meaningful portion of our user and subscriber bases may be adversely impacted.

If so, our customer relationship management efforts, our ability to reach new segments of our user and subscriber bases and the population generally, the efficiency of our paid marketing efforts, the rates we are able to charge advertisers seeking to reach users and subscribers on our various properties, and our ability to identify and exclude users and subscribers whose access would violate applicable terms and conditions, including underage individuals and bad actors, may be negatively impacted, and our business, financial condition and results of operations could be adversely affected.

As the distribution of our products through app stores increases, in order to maintain our profit margins, we may need to offset increasing app store fees by decreasing traditional marketing expenditures, increasing user volume, or monetization per user or by engaging in other efforts to increase revenue or decrease costs generally, or our business, financial condition, and results of operations could be adversely affected.

We rely on the Apple App Store and the Google Play Store to distribute and monetize our mobile applications and related in-app products.

While our mobile applications are generally free to download from these stores, we offer our users the opportunity to purchase subscriptions and certain à la carte features within these applications.

We determine the prices at which these subscriptions and features are sold;

however, purchases of these subscriptions and features via our mobile applications are required to be processed through

the in-app payment systems provided by Apple and Google.

Due to these requirements, we pay Apple and Google, as applicable, a meaningful share (generally 30%) of the revenue we receive from these transactions.

While we are constantly innovating on and creating our own payment systems and methods, given the ever increasing distribution of our products through app stores and the strict mandates to use the in-app payments systems tied into Apple’s and Google’s app stores, we may need to offset these increased app store fees by decreasing traditional marketing expenditures as a percentage of revenue, increasing user volume or monetization per user, or by engaging in other efforts to increase revenue or decrease costs generally, or our business, financial condition and results of operations could be adversely affected.

Google announced that it will require all developers to process all in-app purchases of subscriptions and features entirely through their in-app payment system beginning on September 30, 2021.

To date, Google has not enforced such a requirement, but if Google does so, our business, financial condition and results of operations would be adversely affected.

We depend on our key personnel.

Our future success will depend upon our continued ability to identify, hire, develop, motivate and retain highly skilled individuals worldwide, particularly in the case of senior management.

Competition for well-qualified employees across IAC and its various businesses is intense and we must attract new (and retain existing) employees to compete effectively.

While we have established programs to attract new (and retain existing) employees, we may not be able to attract new (or retain existing) key and other employees in the future.

In addition, if we do not ensure the effective transfer of knowledge to successors and smooth transitions (particularly in the case of senior management) across our various businesses, our business, financial condition and results of operations generally, could be adversely affected.

We may experience risks related to acquisitions.

We have made numerous acquisitions in the past and we continue to seek to identify potential acquisition candidates that will allow us to apply our expertise to expand their capabilities, as well as maximize our existing assets.

If we do not identify suitable acquisition candidates or complete acquisitions on satisfactory pricing or other terms, our growth could be adversely affected.

Even if we complete what we believe to be suitable acquisitions, we may experience related operational and financial risks.

As a result, to the extent that we continue to grow through acquisitions, we will need to:

• properly value prospective acquisitions, especially those with limited operating histories;

successfully integrate the operations, as well as the various functions and systems, of acquired businesses with our existing operations, functions and systems;

• successfully identify and realize potential synergies among acquired and existing businesses;

• retain or hire senior management and other key personnel at acquired businesses;

• successfully manage acquisition‑related strain on management, operations and financial resources.

We may not be successful in addressing these challenges or any other problems encountered in connection with historical and future acquisitions, including the pending acquisition of Care.com.

In addition, the anticipated benefits of one or more acquisitions, including any that IAC expects to realize as a result of the acquisition of Care.com, may not be realized.

Also, future acquisitions could result in increased operating losses, potentially dilutive issuances of equity securities and/or the assumption of contingent liabilities.

Lastly, the value of goodwill and other intangible assets acquired could be impacted by one or more continuing unfavorable events and/or trends, which could result in significant impairment charges.

Our future success will depend upon our continued ability to identify, hire, develop, motivate and retain highly skilled individuals across the globe, with the continued contributions of our senior management being especially critical to our success.

Competition for well-qualified employees across Match Group and its various businesses is intense and our continued ability to compete effectively depends, in part, upon our ability to attract new employees.

Effective succession planning is also important to our future success.

If we fail to ensure the effective transfer of senior management knowledge and smooth transitions involving senior management across our various businesses, our ability to execute short and long term strategic, financial and operating goals, as well as our business, financial condition and results of operations generally, could be adversely affected.

Our success depends, in part, on the integrity of our systems and infrastructures and on our ability to enhance, expand, and adapt these systems and infrastructures in a timely and cost-effective manner.

To succeed, our systems and infrastructures must perform well on a consistent basis.

We have and may from time to time, experience system interruptions that make some or all of our systems or data unavailable and prevent our products from functioning properly for our users.

Any such interruption could arise for any number of reasons.

Further, our systems and infrastructures are vulnerable to damage from fire, power loss, telecommunications failures, acts of God and similar events.

While we have backup systems in place for certain aspects of our operations, not all of our systems and infrastructures are fully redundant, disaster recovery planning is not sufficient for all eventualities and our property and business interruption insurance coverage may not be adequate to fully compensate us for any losses that we may suffer.

Any interruptions or outages, regardless of the cause, could negatively impact our users’ experiences with our products, tarnish our brands’ reputations and decrease demand for our products, any or all of which could adversely affect our business, financial condition and results of operations.

We also continually work to expand and enhance the efficiency and scalability of our technology and network systems to improve the experience of our users, accommodate substantial increases in the volume of traffic to our various products, ensure acceptable load times for our products and keep up with changes in technology and user preferences.

Any failure to do so in a timely and cost-effective manner could adversely affect our users’ experience with our various products and thereby negatively impact the demand for our products, and could increase our costs, either of which could adversely affect our business, financial condition and results of operations.

We may not be able to protect our systems and infrastructure from cyberattacks and may be adversely affected by cyberattacks experienced by third parties.

We are regularly under attack by perpetrators of random or targeted malicious technology-related events, such as cyberattacks, computer viruses, worms, bot attacks or other destructive or disruptive software, distributed denial of service attacks and attempts to misappropriate customer information, including personal user data, credit card information and account login credentials.

While we have invested (and continue to invest) in the protection of our systems and infrastructure, in related personnel and training and in employing a data minimization strategy, where appropriate, there can be no assurance that our efforts will prevent significant breaches in our systems or other such events from occurring.

Some of our systems have experienced past security incidents, and, although they did not have a material adverse effect on our operating results, there can be no assurance of a similar result in the future.

Any cyber or similar attack we are unable to protect ourselves against could damage our systems and infrastructure, prevent us from providing our products, tarnish our brand

reputation, result in the disclosure of confidential or sensitive information of our users and/or be costly to remedy, as well as subject us to investigations by regulatory authorities and/or litigation that could result in liability to third parties.

The impact of cyber or similar attacks experienced by third parties who provide services to us or otherwise process data on our behalf could have a similar effect on us.

Moreover, even cyber or similar attacks that do not directly affect us or our third party service providers or data processors may result in widespread access to user account login credentials that such users have used across multiple internet sites, including our sites, or a loss of consumer confidence generally, which could make users less likely to use or continue to use online products generally, including our products.

The occurrence of any of these events could have an adverse effect on our business, financial condition and results of operations.

We face additional risks in connection with our international operations.

We currently operate in various jurisdictions abroad and may continue to expand our international presence.

Operating abroad, particularly in jurisdictions where we have limited experience, exposes us to additional risks, including:

• operational and compliance challenges caused by distance, language barriers and cultural differences;

• difficulties in staffing and managing international operations;

• differing levels (or lack) of social and technological acceptance of our products and services;

• slow or lagging growth in the commercial use and acceptance of the Internet;

• foreign currency fluctuations;

• restrictions on the transfer of funds among countries and back to the United States and related repatriation costs;

• differing and potentially adverse tax laws;

compliance challenges due to differences in laws and regulatory environments, particularly in the case of privacy, data security and intermediary liability laws, rules and regulations;

• competitive environments that favor local businesses;

• limitations on the level of intellectual property protection;

• trade sanctions, political unrest, terrorism, war and epidemics or the threat of any of these events.

The occurrence of any or all of these events could adversely affect our international operations, and in turn, our business, financial condition and results of operations.

Our success in international markets will also depend, in large part, on our ability to successfully complete international acquisitions, joint ventures or other transactions and integrate these businesses and operations with our own.

A variety of new laws, or new interpretations of existing laws, could subject us to claims or otherwise harm our business.

We are subject to a variety of laws and regulations in the U.S.

and abroad that involve matters that are important to or may otherwise impact our business, including, among others, broadband internet access, online commerce, advertising, privacy and data protection, intermediary liability, consumer protection, protection of minors, taxation and securities compliance.

These domestic and foreign laws, which in some cases can be enforced by private parties in addition to government entities, are constantly evolving and can be subject to significant change.

As a result, the application, interpretation and enforcement of these laws and regulations are often uncertain, particularly in the Internet industry, and may be interpreted and applied inconsistently from jurisdiction to jurisdiction, as well as in a manner that could conflict with our current policies and practices.

We face the same issues in the case of amended, proposed or new laws and regulations.

Compliance with applicable laws and regulations, as well as responding to any related inquiries, investigations or other government action, could be costly, delay or impede the development of new products and services, require modifications to existing products and services, require us to change or cease certain business practices and/or require significant management time and attention.

Non-compliance could subject us to remedies that could harm our business, such as fines, demands or orders that require us to modify or cease then current products and services, as well as result in negative publicity, any of which, if significant, could adversely affect our business, financial condition and results of operations.

We are particularly sensitive to laws and regulations that adversely impact the popularity or growth in use of the Internet and/or online products and services generally, restrict or otherwise unfavorably impact the ability or manner in which we provide our products and services, regulate the practices of third parties upon which we rely to provide our products and services and undermine open and neutrally administered Internet access.

For example, in February 2019, the Secretary of State for Digital, Culture, Media and Sport of the United Kingdom, indicated in public comments that his office intends to inquire as to the measures utilized by online dating platforms (including Tinder) to prevent access by underage users.

To the extent our dating business is required to implement new measures to prevent such access, our business, financial condition and results of operations could be adversely affected.

In addition, in April 2019, the United Kingdom published proposed legislation that would create a new regulatory body responsible for establishing duties of care for Internet companies and for assessing related compliance.

As proposed, failure to comply with the legislation could result in fines, blocking of services and personal liability for senior management.

To the extent our businesses are required to implement new measures and/or make changes to our products and services to ensure compliance, our business, financial condition and results of operations could be adversely affected.

Compliance with this legislation or similar or more stringent legislation in other jurisdictions could be costly, and the failure to comply could result in service interruptions and negative publicity, any or all of which could adversely affect our

business, financial condition and results of operations.

In addition, in December 2017, the U.S.

Federal Communications Commission (the “FCC”) adopted an order reversing net neutrality protections in the United States, including the repeal of specific rules against blocking, throttling or “paid prioritization” of content or services by Internet service providers.

To the extent Internet service providers take such actions, our business, financial condition and results of operations could be adversely affected.

In the case of the businesses within our Match Group, ANGI Homeservices, Vimeo and Applications segments, as well as our Care.com business, we are also sensitive to the adoption of any law or regulation affecting the ability of our businesses to periodically charge for recurring membership or subscription payments.

For example, the European Union Payment Services directive, which became effective in 2018, could impact the ability of our businesses to process auto-renewal payments for, as well offer promotional or differentiated pricing to, users who reside in the European Union, and similar new (and proposed changes to similar existing legislation or regulations) are being considered in many U.S.

The adoption of any law or regulation that adversely affects revenue from recurring membership or subscription payments could adversely affect our business, financial condition and results of operations.

We are also generally sensitive to the adoption of new tax laws.

The European Commission and several European countries have recently adopted (or intend to adopt) proposals that would change various aspects of the current tax framework under which certain of our European businesses are taxed, including proposals to change or impose new types of non-income taxes (including taxes based on a percentage of revenue).

For example, France enacted a Digital Services Tax in 2019, which is applicable to revenues over specified thresholds generated by businesses that provide intermediary services (any digital interface that enables users to contact and interact with others) to, and/or publish advertising-based user data linked to, users residing in France.

The proposal, which is applicable retroactively to revenues earned from and after January 1, 2019, would likely apply to certain of our businesses.

The United Kingdom previously enacted a similar proposal, the Digital Services Tax, which is applicable to revenues of social media platforms, online marketplaces and search engines linked to users residing in the United Kingdom and earned from and after April 1, 2020, which would likely apply to certain of our businesses.

One or more of these or similar proposed tax laws could adversely affect our business, financial condition and results of operations.

In addition, in the case of our ANGI Homeservices segment and to a lesser extent, our Care.com business, we are particularly sensitive to the adoption of worker classification laws, specifically, laws that could effectively require us to change our classification of certain of our service professionals and caregivers from independent contractors to employees, as well as changes to state and local laws or judicial decisions relating to the definition and/or classification of independent contractors.

For example, California recently passed a worker classification statute (AB 5), which effectively narrowed the definition of an independent contractor by requiring hiring entities to use a stricter test to determine a given worker’s classification.

In addition, AB 5 places the burden of proof for classifying workers as independent contractors on hiring entities and provides enforcement powers to the state and certain cities.

Also, legislative proposals concerning worker classification are being considered by various states, including New York and New Jersey.

Since we currently treat certain of our service professionals (and in limited cases, our caregivers) as independent contractors for all purposes, we do not withhold federal, state and local income or other employment related taxes, make federal or state unemployment tax or Federal Insurance Contributions Act payments or provide workers’ compensation insurance with respect to such individuals.

If we are required as the result of new laws to reclassify these individuals as employees, we could be exposed to various liabilities and additional costs, including exposure (for prior and future periods) under federal, state and local tax laws, and workers’ compensation, unemployment benefits, labor, and employment laws, as well as potential liability for penalties and interest, any or all of which could adversely affect our business, financial condition and results of operations.

We are involved in various legal proceedings and investigations challenging the classification of these individuals as independent contractors and may become involved in other proceedings and investigations in the future.

Lastly, in the case of the businesses within our Vimeo segment, we are also sensitive to the changes in laws and regulations that limit the liability of online intermediaries for copyright infringement by their users.

While the U.S.

Digital Millennium Copyright Act (the “DMCA”) currently provides a safe harbor for online intermediates, based primarily on the principles of notice and takedown.

If the DMCA is interpreted in a manner unfavorable to online providers, our business, financial condition and results of operations could be adversely affected.

In addition, in June 2019, the European Union passed the Directive on Copyright in the Digital State Market, which requires each European Union member state to adopt by June 2021 a regulatory framework that requires online intermediaries and copyright holders to use best efforts to license or takedown to infringing content.

To the extent this legislation or similar or more stringent legislation in the U.S.

or other jurisdictions abroad requires our businesses to implement new measures and/or make changes to our products and services to ensure compliance, which could be costly, our business, financial condition and results of operations could be adversely affected.

Our success depends, in part, on the integrity of third-party systems and infrastructure.

We rely on third parties, primarily data center and cloud-based, hosted web service providers, such as Amazon Web Services, as well as third party computer systems, broadband and other communications systems and service providers, in connection with the provision of our products generally, as well as to facilitate and process certain transactions with our users.

We have no control over any of these third parties or their operations.

Any changes in service levels at our data centers or hosted web service providers or any interruptions, outages or delays in our systems or those of our third party providers, deterioration in the performance of these systems, or cyber or similar attacks on these systems could impair our ability to provide our products or process transactions with our users, which would adversely impact our business, financial condition and results of operations.

If the security of personal and confidential or sensitive user information that we maintain and store is breached or otherwise accessed by unauthorized persons, it may be costly to mitigate the impact of such an event and our reputation could be harmed.

We receive, process, store, and transmit a significant amount of personal user and other confidential or sensitive information, including credit card information and user-to-user communications, and enable our users to share their personal information with each other.

In some cases, we engage third party service providers to store this information.

We continuously develop and maintain systems to protect the security, integrity and confidentiality of this information, but we have experienced past incidents and cannot guarantee that inadvertent or unauthorized use or disclosure will not occur in the future or that third parties will not gain unauthorized access to this information despite our efforts.

When such events occur, we may not be able to remedy them, be required by law to notify regulators and individuals whose personal information was used or disclosed without authorization, be subject to claims against us, including government enforcement actions, fines and litigation, and have to expend significant capital and other resources to mitigate the impact of such events, including developing and implementing protections to prevent future events of this nature from occurring.

When breaches of security (or the security of our service providers) occur, the perception of the effectiveness of our security measures, the security measures of our service providers and our reputation may be harmed, we may lose current and potential users and the our various brands’ reputation and competitive positions may be tarnished, any or all of which might adversely affect our business, financial condition and results of operations.

Our business is subject to complex and evolving U.S.

and international laws and regulations, including with respect to data privacy and platform liability.

These laws and regulations are subject to change and uncertain interpretation, and could result in changes to our business practices, increased cost of operations, declines in user growth or engagement, claims, monetary penalties, or otherwise harm our business.

We are subject to a variety of laws and regulations in the United States and abroad that involve matters that are important to or may otherwise impact our business.

See “Item 1—Business—Government regulation.” These U.S.

federal, state, and municipal and foreign laws and regulations, which in some cases can be enforced by private parties in addition to government entities, are constantly evolving and subject to change.

As a result, the application, interpretation, and enforcement of these laws and regulations are often uncertain, particularly in the rapidly evolving industry in which we operate, and may be interpreted and applied inconsistently from state to state and country to country and inconsistently with our current policies and practices.

These laws and regulations, as well as any associated inquiries, investigations or other government actions, may be costly to comply with and may delay or impede the development of new products, require changes to or cessation of

certain business practices, result in negative publicity, increase our operating costs, require significant management time and attention, and subject us to remedies that may harm our business, including fines or modifications to existing business practices.

In the case of tax laws, positions that we have taken or will take are subject to interpretation by the relevant taxing authorities.

While we believe that the positions we have taken to date comply with applicable law, there can be no assurances that the relevant taxing authorities will not take a contrary position, and if so, that such positions will not adversely affect us.

Any events of this nature could adversely affect our business, financial condition and results of operations.

Proposed or new legislation and regulations could also adversely affect our business.

See “Item 1—Business—Government regulation.” To the extent such new or more stringent measures are required to be implemented, impose new liability or limit or remove existing protections, our business, financial condition and results of operations could be adversely affected.

The adoption of any laws or regulations that adversely affect the popularity or growth in use of the internet or our services, including laws or regulations that undermine open and neutrally administered internet access, could decrease user demand for our service offerings and increase our cost of doing business.

For example, in December 2017, the Federal Communications Commission adopted an order reversing net neutrality protections in the United States, including the repeal of specific rules against blocking, throttling or “paid prioritization” of content or services by internet service providers.

To the extent internet service providers engage in such blocking, throttling, “paid prioritization” of content or similar actions as a result of this order and the adoption of similar laws or regulations, our business, financial condition and results of operations could be adversely affected.

We are subject to a number of risks related to credit card payments, including data security breaches and fraud that we or third parties experience, any of which could adversely affect our business, financial condition, and results of operations.

We accept payment from our users primarily through credit card transactions and certain online payment service providers.

When we or a third party experiences a data security breach involving credit card information, affected cardholders will often cancel their credit cards.

In the case of a breach experienced by a third party, the more sizable the third party’s customer base and the greater the number of credit card accounts impacted, the more likely it is that our users would be impacted by such a breach.

To the extent our users are affected by such a breach experienced by us or a third party, such users would need to be contacted to obtain new credit card information and process any pending transactions.

It is likely that we would not be able to reach all affected users, and even if we could, some users’ new credit card information may not be obtained and some pending transactions may not be processed, which could adversely affect our business, financial condition and results of operations.

Even if our users are not directly impacted by a given data security breach, they may lose confidence in the ability of service providers to protect their personal information generally, which could cause them to stop using their credit cards online or choose alternative payment methods that are less convenient or more costly for us or otherwise restrict our ability to process payments without significant user effort.

Additionally, if we fail to adequately prevent fraudulent credit card transactions, we may face litigation, fines, governmental enforcement action, civil liability, diminished public perception of our security measures, significantly higher credit card-related costs and remediation costs, or refusal by credit card processors to continue to process payments on our behalf, any of which could adversely affect our business, financial condition and results of operations.

Inappropriate actions by certain of our users could be attributed to us and damage our brands’ reputations, which in turn could adversely affect our business.

Users of our products have been, and may in the future be, physically, financially, emotionally or otherwise harmed by other individuals that such users met or may meet through the use of one of our products.

When one or more of our users suffers or alleges to have suffered any such harm, we have in the past, and could in the future, experience negative publicity or legal action that could damage our reputation and our brands.

Similar events affecting users of our competitors’ products have in the past, and could in the future, result in negative publicity for the dating industry generally, which could in turn negatively affect our business.

In addition, the reputations of our brands may be adversely affected by the actions of our users that are deemed to be hostile, offensive, defamatory, inappropriate, untrue or unlawful.

While we have systems and processes in place that aim to monitor and review the appropriateness of the content accessible through our products, and have adopted policies regarding illegal, offensive or inappropriate use of our products, our users have in the past, and could in the future, nonetheless engage in activities that violate our policies.

These safeguards may not be sufficient to avoid harm to our reputation and brands, especially if such hostile, offensive or inappropriate use is well-publicized.

We may fail to adequately protect our intellectual property rights or may be accused of infringing the intellectual property rights of third parties.

We rely heavily upon our trademarks and related domain names and logos to market our brands and to build and maintain brand loyalty and recognition, as well as upon trade secrets.

We also rely, to a lesser extent, upon patented and patent-pending proprietary technologies with expiration dates ranging from 2020 to 2037.

We rely on a combination of laws and contractual restrictions with employees, customers, suppliers, affiliates and others to establish and protect our various intellectual property rights.

We rely heavily upon our trademarks and related domain names and logos to market our brands and to build and maintain brand loyalty and recognition.

We also rely upon patented and patent-pending proprietary technologies and trade secrets relating to our products.

We rely on a combination of laws, and contractual restrictions with employees, customers, suppliers and others, to establish and protect our intellectual property rights.

For example, we have generally registered and continue to apply to register and renew, or secure by contract where appropriate, trademarks and service marks as they are developed and used, and reserve, register and renew domain names as we deem appropriate.

We also generally seek to apply for patents or for other similar statutory protections as and if we deem appropriate, based on then current facts and circumstances, and will continue to do so in the future.

No assurances can be given that these efforts will result in adequate trademark and service mark protection, adequate domain name rights and protections, the issuance of a patent or adequate patent protection against competitors and similar technologies.

Third parties could also create new products or methods that achieve similar results without infringing upon patents we own.

Despite these measures, challenges to our intellectual property rights could still arise, third parties could copy or otherwise obtain and use our intellectual property without authorization and/or laws regarding the enforceability of existing intellectual property rights could change in an adverse manner.

The occurrence of any of these events could result in the erosion of our brands and limitations on our ability to control marketing online using our various domain names, as well as impede our ability to effectively compete against competitors with similar technologies, any of which could adversely affect our business, financial condition and results of operations.

From time to time, we have been subject to legal proceedings and claims in the ordinary course of business related to alleged claims of infringement of the intellectual property of others by us and users of certain of our products and services and may need to institute legal proceedings in the future to enforce, protect or refine the scope of our intellectual property rights.

For example, in March 2018, our Match Group business filed a lawsuit against Bumble Trading Inc., which operates and markets the online dating application Bumble in the United States, for patent and trademark infringement, as well as trade secret misappropriation.

Bumble’s counterclaims request that our trademark registration for Tinder’s SWIPE trademark be canceled and that a number of our pending applications for trademark registration be denied.

This case is currently pending in Federal Court in the Western District of Texas.

Any legal proceedings related to intellectual property, regardless of outcome or merit, could be costly and result in diversion of and technical resources, which could adversely affect our business, financial condition and results of operations.

Risks Related to Our Liquidity, Indebtedness and Dilution

Our current and future indebtedness could affect our ability to operate our business, which could have a material adverse effect on our financial condition and results of operations.

As of December 31, 2019, we had total debt outstanding of approximately $3.1 billion, of which approximately $1.3 billion, $1.6 billion and $232.0 million was owed by IAC, Match Group and ANGI Homeservices, respectively.

As of that date, we, Match Group and ANGI Homeservices had borrowing availability of $250 million, $500 million and $250 million, respectively, under our revolving credit facilities.

Neither Match Group, ANGI Homeservices nor any of their respective subsidiaries guarantee any indebtedness of IAC or are currently subject to any of the covenants related to such indebtedness.

Similarly, neither IAC nor any of its subsidiaries (other than Match Group and its subsidiaries in the case of Match Group indebtedness and ANGI Homeservices and its subsidiaries in the case of ANGI Homeservices indebtedness) guarantee any indebtedness of Match Group or ANGI Homeservices nor are subject to any of the covenants related to such indebtedness.

The terms of the indebtedness of IAC, Match Group and ANGI Homeservices could:

limit our respective abilities to obtain additional financing to fund working capital needs, acquisitions, capital expenditures or other debt service requirements or for other purposes;

limit our respective abilities to use operating cash flow in other areas of our respective businesses because we must dedicate a substantial portion of these funds to service indebtedness;

limit our respective abilities to compete with other companies who are not as highly leveraged;

restrict any one or more of us from making strategic acquisitions, developing properties or exploiting business opportunities;

restrict the way in which one or more of us conducts business;

expose one or more of us to potential events of default, which if not cured or waived, could have a material adverse effect on our business, financial condition and operating results;

increase our respective vulnerabilities to a downturn in general economic conditions or in pricing of our various products and services;

• limit our respective abilities to react to changing market conditions in the various industries in which we do business.

Subject to certain restrictions, we and our subsidiaries may incur additional unsecured and secured indebtedness.

If additional indebtedness incurred in compliance with these restrictions is significant, the risks described above could increase.

Lastly, if an event a default has occurred or our leverage ratio exceeds specified thresholds, our ability to pay dividends, make distributions and repurchase or redeem our capital stock would be limited.

Match Group and ANGI Homeservices are subject to similar restrictions.

See “Item 7-Management's Discussion and Analysis of Financial Condition and Results of Operations-Financial Position, Liquidity and Capital Resources and Financial Position.”

We may not be able to generate sufficient cash to service all of our indebtedness.

The ability of IAC, Match Group and ANGI Homeservices to satisfy our respective debt obligations will depend upon, among other things:

our respective future financial and operating performance, which will be affected by prevailing economic conditions and financial, business, regulatory and other factors, many of which are beyond our control;

the future ability of IAC, Match Group and ANGI Homeservices to borrow under our respective revolving credit facilities, which will depend on, among other things, our ability to comply with the covenants governing our respective indebtedness.

Neither we, nor Match Group nor ANGI Homeservices may be able to generate sufficient cash flow from our respective operations and/or borrow under our respective revolving credit facilities in amounts sufficient to meet our scheduled debt obligations.

See also “-We may not freely access the cash of Match Group, ANGI Homeservices and their respective subsidiaries” below.

If so, we could be forced to reduce or delay capital expenditures, sell assets or seek additional capital in a manner that complies with the terms (including certain restrictions and limitations) of our current indebtedness.

If these efforts do not generate sufficient funds to meet our scheduled debt obligations, we would need to seek additional financing and/or negotiate with our lenders to restructure or refinance our indebtedness.

Our ability to do so would depend on the condition of the capital markets and our financial condition at such time.

Any such financing, restructuring or refinancing could be on less favorable terms than those governing our current indebtedness and would need to comply with the terms (including certain restrictions and limitations) of our existing indebtedness.

We may not freely access the cash of Match Group, ANGI Homeservices and their respective subsidiaries.

Potential sources of cash for IAC include our available cash balances, net cash from the operating activities of certain of our subsidiaries, availability under our revolving credit facility and proceeds from asset sales, including marketable securities.

While the ability of our operating subsidiaries to pay dividends or make other payments or advances to us depends on their individual operating results and applicable statutory, regulatory or contractual restrictions generally, in the case of Match Group and ANGI Homeservices, the terms of their indebtedness limit their ability to pay dividends or make distributions, loans or advances to stockholders, including IAC, in certain circumstances.

In addition, because Match Group and ANGI Homeservices are separate and distinct legal entities with public shareholders, they have no obligation to provide us with funds.

Our variable rate indebtedness subjects us to interest rate risk.

As of December 31, 2019, Match Group and ANGI Homeservices had $425 million and $275 million, respectively, outstanding under their term loans (and no amounts outstanding under their revolving credit facilities) .

Borrowings under these loans are, and any borrowings under the revolving credit facilities of IAC, Match Group or ANGI Homeservices will be, at

variable interest rates, which exposes us to interest rate risk.

For details regarding interest rates applicable to the variable rate indebtedness of Match Group and ANGI Homeservices described above as of December 31, 2019 and how certain increases and decreases in LIBOR rate would affect related interest expense, see “Item 7A-Quantitative and Qualitative Disclosures About Market Risk.”

You may experience dilution with respect to your investment in IAC, and IAC may experience dilution with respect to its investments in Match Group and ANGI Homeservices, as a result of compensatory equity awards.

We have issued various compensatory equity awards, including stock options, stock appreciation rights and restricted stock unit awards denominated in shares of our common stock, as well as in equity of our various consolidated subsidiaries, including Match Group and ANGI Homeservices.

For more information regarding these awards and their impact on our diluted earnings per share calculation, see “Note 11-Stock-Based Compensation" and "Note 10-Earnings Per Share," respectively, to the consolidated financial statements included in "Item 8-Consolidated Financial Statements and Supplementary Data.”

The issuance of shares of IAC common stock in settlement of these equity awards could dilute your ownership interest in IAC.

Awards denominated in shares of Match Group or ANGI Homeservices common stock that are settled in shares of those subsidiaries could dilute IAC’s ownership interest in Match Group and ANGI Homeservices, respectively.

The dilution of our ownership stake(s) in Match Group and/or ANGI Homeservices could impact our ability, among other things, to maintain Match Group and/or ANGI Homeservices as part of our consolidated tax group for U.S.

federal income tax purposes, to effect a tax-free distribution of our Match Group and/or ANGI Homeservices stake(s) to our stockholders or to maintain control of Match Group and/or ANGI Homeservices.

As we generally have the right to maintain our levels of ownership in Match Group and ANGI Homeservices to the extent Match Group or ANGI Homeservices issues additional shares of their respective capital stock in the future pursuant to investor rights agreements, we do not intend to allow any of the foregoing to occur and we expect that the Separation will be a tax-free distribution to our stockholders.

With respect to awards denominated in shares of our non-publicly traded subsidiaries, we estimate the dilutive impact of those awards based on our estimated fair value of those subsidiaries.

Those estimates may change from time to time, and the fair value determined in connection with vesting and liquidity events could lead to more or less dilution than reflected in our diluted earnings per share calculation.

Effective trademark protection may not be available or sought in every country in which our products are made available, and contractual disputes may affect the use of marks governed by private contract.

Similarly, not every variation of a domain name may be available or registered, even if available.

We generally seek to apply for patents or other similar statutory protections as and when we deem appropriate, based on then-current facts and circumstances, and will continue to do so in the future.

No assurances can be given that any patent application we have filed or will file will result in a patent being issued, or that any existing or future patents will afford adequate protection against competitors and similar technologies.

In addition, no assurances can be given that third parties will not create new products or methods that achieve similar results without infringing upon patents we own.

Despite these measures, our intellectual property rights may still not be protected in a meaningful manner, challenges to contractual rights could arise, third parties could copy or otherwise obtain and use our intellectual property without authorization, our existing trademarks, patents, or trade secrets may be determined to be invalid or unenforceable, or laws and interpretations of laws regarding the enforceability of existing intellectual property rights may change over time in a manner that provides less protection.

The occurrence of any of these events could tarnish of our brands’ reputation, limit our ability to market them, or impede our ability to effectively compete against competitors with similar technologies, any of which could adversely affect our business, financial condition and results of operations.

From time to time, we have been subject to legal proceedings and claims, including claims of alleged infringement of trademarks, copyrights, patents and other intellectual property rights held by third parties.

In addition, litigation may be necessary in the future to enforce our intellectual property rights, protect our trade secrets and patents or to determine the validity and scope of proprietary rights claimed by others.

For example, in June 2020, we settled our longstanding litigation with Bumble Trading Inc.

for patent and trademark infringement, as well as trade secret misappropriation.

Any litigation of this nature, regardless of outcome or merit, could result in substantial costs and diversion of management and technical resources, any of which could adversely affect our business, financial condition and results of operations.

We operate in various international markets, including certain markets in which we have limited experience.

As a result, we face additional risks in connection with certain of our international operations.

Operating internationally, particularly in countries in which we have limited experience, exposes us to a number of risks in addition to those otherwise described in this annual report, such as:

• operational and compliance challenges caused by distance, language, and cultural differences;

• difficulties in staffing and managing international operations;

• differing levels of social and technological acceptance of our products or lack of acceptance of them generally;

• compliance challenges due to different laws and regulatory environments, particularly in the case of privacy, data security, intermediary liability, and consumer protection;

• competitive environments that favor local businesses or local knowledge of such environments;

• limitations on the level of intellectual property protection;

• trade sanctions, political unrest, terrorism, war, and epidemics or the threat of any of these events (such as COVID-19).

The occurrence of any or all of the events described above could adversely affect our international operations, which could in turn adversely affect our business, financial condition, and results of operations.

We may experience operational and financial risks in connection with acquisitions.

We have made acquisitions in the past, have recently announced a pending acquisition and continue to seek potential acquisition candidates.

We may experience operational and financial risks in connection with historical and future acquisitions if we are unable to:

• properly value prospective acquisitions, especially those with limited operating histories;

• fully identify potential risks and liabilities associated with acquired businesses;

• successfully integrate the operations and accounting, financial controls, management information, technology, human resources, and other administrative systems, of the acquired businesses with our existing operations and systems;

• retain or hire senior management and other key personnel at acquired businesses;

• successfully support the acquired businesses in executing on strategic plans, including expansion into geographies where we have presence and experience.

Furthermore, we may not be successful in addressing other challenges encountered in connection with our acquisitions and the anticipated benefits of one or more of our acquisitions may not be realized.

In addition, such acquisitions can result in material diversion of management’s attention or other resources from our existing businesses.

The occurrence of any these events could have an adverse effect on our business, financial condition and results of operations.

We are subject to litigation, and adverse outcomes in such litigation could have an adverse effect on our financial condition.

We are, and from time to time may become, subject to litigation and various legal proceedings, including litigation and proceedings related to employment matters, intellectual property matters, privacy and consumer protection laws, as well as stockholder derivative suits, class action lawsuits and other matters, that involve claims for substantial amounts of money or for other relief or that might necessitate changes to our business or operations.

The defense of these actions is time consuming and expensive.

We evaluate these litigation claims and legal proceedings to assess the likelihood of unfavorable outcomes and to estimate, if possible, the amount of potential losses.

Based on these assessments and estimates, we may establish reserves and/or disclose the relevant litigation claims or legal proceedings, as and when required or appropriate.

These assessments and estimates are based on information available to management at the time of such assessment or estimation and involve a significant amount of judgment.

As a result, actual outcomes or losses could differ materially from those envisioned by our current assessments and estimates.

Our failure to successfully defend or settle any of these litigations or legal proceedings could result in liability that, to the extent not covered by our insurance, could have an adverse effect on our business, financial condition and results of operations.

See “Item 3—Legal Proceedings.”

Risks relating to our indebtedness

Our indebtedness may affect our ability to operate our business, which could have a material adverse effect on our financial condition and results of operations.

We and our subsidiaries may incur additional indebtedness, including secured indebtedness.

As of December 31, 2020, we had total debt outstanding of approximately $3.9 billion and borrowing availability of $749.8 million under our revolving credit facility.

Our indebtedness could have important consequences, such as:

• limiting our ability to obtain additional financing to fund working capital needs, acquisitions, capital expenditures, or other debt service requirements or for other purposes;

• limiting our ability to use operating cash flow to pursue acquisitions or invest in other areas, such as developing new brands, products, or exploiting business opportunities;

• restricting our business operations due to financial and operating covenants in the agreements governing our and certain of our subsidiaries’ existing and future indebtedness, including certain covenants that restrict the ability of our subsidiaries to pay dividends or make other distributions to us;

• exposing us to potential events of default (if not cured or waived) under financial and operating covenants contained in our or our subsidiaries’ debt instruments that could have a material adverse effect on our business, financial condition and operating results.

Although the terms of our credit agreement and the indentures related to our senior notes contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of qualifications and exceptions, and additional indebtedness incurred in compliance with these restrictions could be significant.

If new debt is added to our and our subsidiaries’ current debt levels, the risks described above could increase.

We may not be able to generate sufficient cash to service all of our indebtedness and may be forced to take other actions to satisfy our obligations under our indebtedness that may not be successful.

Our ability to satisfy our debt obligations will depend upon, among other things:

• our future financial and operating performance, which will be affected by prevailing economic conditions and financial, business, regulatory, and other factors, many of which are beyond our control;

• our future ability to borrow under our revolving credit facility, the availability of which will depend on, among other things, our complying with the covenants in the then-existing agreements governing our indebtedness.

There can be no assurance that our business will generate sufficient cash flow from operations, or that we will be able to draw under our revolving credit facility or otherwise, in an amount sufficient to fund our liquidity needs.

If our cash flows and capital resources are insufficient to service our indebtedness, we may be forced to reduce or delay capital expenditures, sell assets, seek additional capital or restructure or refinance our indebtedness.

These alternative measures may not be successful and may not permit us to meet our scheduled debt service obligations.

Our ability to restructure or refinance our debt will depend on the condition of the capital markets and our financial condition at such time.

Any refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further restrict our business operations.

In addition, the terms of existing or future debt agreements may restrict us from adopting some of these alternatives.

Variable rate indebtedness that we have incurred or may incur under our credit agreement will subject us to interest rate risk, which could cause our debt service obligations to increase significantly.

We currently have $425 million of indebtedness outstanding under our term loan and no outstanding borrowings under our revolving credit agreement.

Borrowings under term loan are, and any borrowings under

the revolving credit facility will be, at variable rates of interest.

Indebtedness that bears interest at variable rates exposes us to interest rate risk.

See “Item 7A—Quantitative and Qualitative Disclosures About Market Risk—Interest Rate Risk.”

Exchange of the exchangeable notes may dilute the ownership interests of existing stockholders or may otherwise depress the price of our common stock.

We are obligated as a guarantor under the indentures relating to the exchangeable notes.

The exchange of some or all of the exchangeable notes may dilute the ownership interests of our stockholders to the extent we deliver shares of our common stock upon exchange.

While the exchangeable note hedges are expected to reduce the potential dilutive effect on our common stock upon any exchange and/or offset any cash payment the issuers of the exchangeable notes would be required to make in excess of the principal amount of the exchanged notes, the warrants have a dilutive effect to the extent that the market price per share of our common stock exceeds the strike price of the warrants.

Any sales in the public market of our common stock issuable upon such exchange could adversely affect prevailing market prices of our common stock.

In addition, the existence of the exchangeable notes may encourage short selling of our common stock by market participants because the exchange of the exchangeable notes could be used to satisfy short positions.

In addition, the anticipated exchange of the exchangeable notes could depress the price of our common stock.

Risks relating to the Separation

For purposes of the risks relating to the Separation below only, references to:

(i) "IAC" means IAC/InterActiveCorp, a Delaware corporation, as in existence prior to the completion of the Separation, (ii) "Match Group" refers to Match Group, Inc., a Delaware corporation, as in existence prior to the completion of the Separation;

(iii) "New IAC" refers to IAC Holdings, Inc., a Delaware corporation and a direct wholly owned subsidiary of IAC prior to the completion of Separation and which will be referred to as IAC/InterActiveCorp from and after the completion of the Separation, and (iv) "New Match" means IAC, as in existence from and after the completion of the Separation and which will be renamed Match Group, Inc.

The Separation is subject to certain closing conditions that, if not satisfied or waived, will result in the Separation not being completed, which may cause the market price of IAC and Match Group securities to decline.

The completion of the Separation is subject to the satisfaction (or waiver) of a number of conditions, including the receipt of certain approvals from the stockholders of IAC and Match Group and the absence of material litigation.

Some of the conditions to the completion of the Separation are outside of the control of IAC and Match Group.

If any condition to the closing of the Separation is not satisfied or waived, the Separation will not be completed.

In addition, IAC and Match Group may terminate the transaction agreement in certain circumstances.

If the Separation is not completed, the market price of IAC and/or Match Group securities may fluctuate to the extent that then current market prices of those securities reflect a market assumption that the Separation will be completed (among other reasons).

Based on historical activity, any fluctuation in the market price of Match Group securities will likely result in a fluctuation in the market price of IAC securities.

If the Separation is not completed, IAC will have incurred significant costs, including certain investment banking, financing, legal and accounting fees and related expenses and the diversion of management resources, for which we will have received little or no benefit.

New IAC and New Match may not be able to achieve some or all of the benefits that they expect to result from the Separation.

Anticipated benefits that New IAC and New Match expect to result from the Separation may be delayed or not be achieved at all.

For example, there can be no assurances that, despite enhanced management focus, receipt of needed capital and

simplification of its corporate structure, New IAC will succeed in building and scaling its remaining businesses and growing through acquisitions.

Similarly, there can be no assurances that New Match will be able to take advantage of the improved strategic flexibility resulting from the elimination of a controlling shareholder and having a single class of "one share-one vote" common stock.

If these and other anticipated benefits are not achieved or delayed, the business, financial condition and results of operations of New IAC and/or New Match could be adversely affected.

If certain aspects of the Separation fail to qualify as a transaction that is generally tax-free for U.S.

federal income tax purposes, New IAC, New Match their respective stockholders could suffer material adverse consequences.

The completion of the Separation is conditioned upon, among other things, the receipt of tax opinions from IAC's outside counsel to the effect that certain aspects of the Separation and related transactions will be tax-free for U.S.

We may be unable to achieve some or all of the benefits that we expect to achieve through the Separation.

We believe that the intended strategic and financial benefits of the Separation should be achieved.

However, there can be no assurance of this or that we will be able to attract transaction partners using our capital stock as acquisition currency and that analysts and investors will regard our new corporate structure as more clear and simple than our former corporate structure.

If the transactions effected in connection with the Separation were to fail to qualify as generally tax-free for U.S.

federal income tax purposes, we and our stockholders could suffer material adverse consequences.

Following the completion of the Separation and the merger of Former Match Group into a wholly-owned subsidiary (“Merger Sub”) of Former IAC (the “Merger”), Former Match Group’s successor became a wholly-owned subsidiary of Match Group and most of Former IAC’s existing other subsidiaries came to be held under a separate public company.

Former IAC and IAC received opinions from outside counsel that the Separation and related transactions taken together, and the Merger, were tax-free for U.S.

federal income tax purposes.

These tax opinions will be based upon and rely on, among other things, various facts and assumptions, as well as certain representations, statements and undertakings of IAC, Match Group and New IAC, including those relating to past and future conduct.

If any of these representations, statements or undertakings is, or becomes, inaccurate or incomplete, or if any of the representations or covenants contained in any agreements and documents relating to the Separation or in any document relating to such tax opinions are inaccurate or not complied with by IAC, Match Group or New IAC, the tax opinions may be invalid and the conclusions reached therein could be jeopardized.

Even if these tax opinions are valid, no assurances can be provided that the U.S.

Internal Revenue Service (the "IRS") will agree that certain aspects of the Separation qualify for tax-free treatment for U.S.

These opinions were based upon and rely on various facts and assumptions, as well as certain representations and undertakings of Former IAC, Former Match Group, IAC, and Match Group, including relating to the past and future conduct of Former IAC, Former Match Group, IAC, and Match Group.

If any of these representations or undertakings is, or becomes, inaccurate or incomplete, or if any of the representations or covenants contained in any of the transaction-related agreements or in any document relating to the opinions of counsel is, or becomes, inaccurate or is not complied with by Former IAC, Former Match Group, IAC, Match Group, or any of their respective subsidiaries, the opinions of counsel may be invalid and the conclusions reached therein could be jeopardized.

Notwithstanding receipt of the opinions of counsel regarding the transactions, the U.S.

Internal Revenue Service (“IRS”) could determine that some or all of the transactions effected in connection with the Separation should be treated as taxable for U.S.

federal income tax purposes if it determines that any of the representations, assumptions or undertakings upon which the opinions of counsel were based are inaccurate or have not been complied with.

Moreover, even if the foregoing representations, assumptions or undertakings are accurate and have been complied with, the opinions of counsel merely represent the judgment of such counsel and are not binding on the IRS or any court, and the IRS or a court may disagree with the conclusions in the opinions of counsel.

Accordingly, there can be no assurance that the IRS will not assert that the transactions effected in connection with the Separation do not qualify for tax-free treatment for U.S.

federal income tax purposes or that a court would not sustain such a challenge.

In the event the IRS were to prevail with such a challenge, New IAC, New Match and their respective stockholders could suffer material adverse consequences.

Even if certain aspects of the Separation were otherwise to qualify as a tax-free transaction under Sections 355(a) and 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended (the "Code"), the Separation could result in taxable gain to New Match (but not its stockholders) under Section 355(e) of the Code if certain aspects of the Separation were deemed to be part of a plan (or series of related transactions) pursuant to which one or more persons acquire, directly or indirectly, shares representing a 50 percent or greater interest (by vote or value) in IAC (or after the completion of the Separation, New Match) or New IAC within two years before or after the Separation.

Following the Separation, New IAC and New Match will be parties to a tax matters agreement pursuant to which, among other things, each of them will be responsible for certain tax liabilities and obligations following the Separation.

Under the tax matters agreement, New IAC generally will be responsible for, and will indemnify New Match against, any liabilities incurred as a result of the failure of certain aspects of the Separation to qualify for the intended tax-free treatment unless, subject to certain exceptions, the failure to so qualify is attributable to Match Group’s (or, after the Separation, New Match’s) actions or failure to act, Match Group’s breach of certain representations or covenants or certain acquisitions of equity securities of New Match, in each case, described in the tax matters agreement.

The amount of any such liability for which New IAC or New Match would be responsible may be significant and, if incurred, could have a material adverse effect on New IAC's or New Match’s, as the case may be, business, financial condition and results of operations and, therefore, adversely affect the value of New IAC common stock or New Match common stock.

New IAC and New Match may not be able to engage in desirable capital-raising or strategic transactions following the Separation.

To preserve the tax-free treatment of certain aspects of the Separation, the tax matters agreement will, during the two-year period following the Separation, impose certain restrictions on New IAC and New Match (except in specific circumstances):

(i) ceasing to actively conduct certain of their respective businesses;

(2) entering into certain transactions or a series of transactions pursuant to which all or a portion of their outstanding capital stock would be acquired, whether by merger or otherwise;

(iii) liquidating or merging or consolidating with any other person;

(iv) issuing equity securities beyond certain thresholds;

(v) repurchasing shares of their outstanding capital stock (other than in certain open-market transactions);

or (vi) taking any other action that (or failing to take any other action, the failure of which) would certain aspects of the Separation, together with certain related transactions, to fail to qualify as a transaction that is generally tax-free for U.S.

In the event the IRS were to prevail with such a challenge, parties to the Separation, including Match Group could be subject to tax with respect to the Separation.

For example, if the transactions effected in connection with the Separation were to fail to qualify as a transaction that is generally tax-free for U.S.

federal income tax purposes under Sections 355 and 368(a)(1)(D) of the Internal Revenue Code of 1986 (as amended, the “Code”), in general, for U.S.

federal income tax purposes, we would recognize a taxable gain as if the distribution of New IAC stock in connection with the Separation had been sold in a taxable sale for its fair market value.

Even if the transactions effected in connection with the Separation were to otherwise qualify as a tax-free transaction under Sections 355 and 368(a)(1)(D) of the Code, taxable gain may be triggered under Section 355(e) of the Code if the transactions effected in connection with the Separation were, or later transactions are, deemed to be part of a plan (or series of related transactions) pursuant to which one or more persons acquire, directly or indirectly, shares representing a 50 percent or greater interest (by vote or value) in us or IAC.

For this purpose, any acquisitions of (i) Former IAC stock or Former Match Group stock before the Separation or (ii) IAC stock or Match Group stock within the period beginning two years before the Separation and ending two years after the Separation are presumed to be part of such a plan, although we or IAC may be able to rebut that presumption.

In addition to potential tax liabilities relating to Former Match Group, we and our subsidiaries could be liable to satisfy any tax liabilities relating to Former IAC or IAC with respect to the Separation if their tax-free treatment for U.S.

federal income tax purposes were successfully challenged by the IRS.

While, in some cases, IAC may be obligated under the Tax Matters Agreement to indemnify us for some or all of such taxes, even in those cases, there is no assurance that they will in fact indemnify us.

In addition, if the Merger were determined to be taxable for U.S.

federal income tax purposes, we would be subject to tax on the transfer of the assets of Former Match to Merger Sub.

If we or our subsidiaries were required to pay taxes imposed on us with respect to the Separation, our cash flows would be adversely affected.

We may not be able to engage in desirable capital-raising or strategic transactions following the Separation.

We believe we will generally be able to engage in desirable capital-raising or strategic transactions.

However, under current U.S.

federal income tax law, a distribution that otherwise qualifies for tax-free treatment can be rendered taxable to the distributing corporation and its stockholders as a result of certain post-distribution transactions, including certain acquisitions of shares or assets of both the distributing corporation and the corporation the stock of which is distributed.

To preserve the tax-free treatment of the transactions effected in connection with the Separation, the Tax Matters Agreement imposes certain restrictions on us and our subsidiaries during the two-year period following the Separation.

Except in specific circumstances, we are generally restricted from (1) ceasing to actively conduct certain of our businesses;

(2) entering into certain transactions or series of transactions pursuant to which all or a portion of our shares of common stock would be acquired, whether by merger or otherwise;

(3) liquidating or merging or consolidating with any other person;

(4) issuing equity securities beyond certain thresholds;

(5) repurchasing shares of our common stock, other than in certain open-market transactions;

or (6) taking or failing to take any other action that would cause the transactions effected in connection with the Separation to fail to qualify as a transaction that is generally tax-free for U.S.

federal income tax purposes under Sections 355 and 368(a)(1)(D) of the Code.

These restrictions may limit the ability of New IAC and New Match to pursue certain equity issuances, strategic transactions, repurchases or other transactions that they may otherwise believe to be in the best interests of their respective stockholders or that might increase the value of their respective businesses.

Also, the potential responsibility of New IAC and New Match for liabilities arising from the failure of certain aspects of the Separation to qualify for tax-free treatment, or their indemnity obligations to each other for such liabilities under the tax matters agreement, could discourage, delay or prevent certain third parties from acquiring New IAC or New Match.

After the Separation, actual or potential conflicts of interest may develop between New IAC’s management and directors, on the one hand, and the management and directors of New Match, on the other hand.

After the Separation, management and directors of New IAC may own New IAC and New Match common stock.

This ownership overlap could create (or appear to create) potential conflicts of interest when New IAC directors and executive officers face decisions that could have different implications for New IAC and New Match.

For example, potential conflicts of interest could arise in connection with the resolution of disputes regarding terms of the agreements governing the Separation and the relationship between New IAC and New Match following the Separation.

Potential conflicts of interest could also arise if New IAC and New Match were to enter into new commercial arrangements in the future.

In addition, Joseph Levin initially will serve as the executive chairman of New Match’s board of directors, while also serving as the Chief Executive Officer of New IAC.

Schiffman will initially serve as a director of New Match while also serving as an executive officer of New IAC and Alan G.

Spoon will serve as a director of both New IAC and New Match.

The fact that Messrs.

Levin, Schiffman and Spoon will hold positions with both companies following the completion of the Separation could create (or appear to create) potential conflicts of interest for each of them when facing decisions that may affect both companies, and each of them may also face conflicts of interest with regard to the allocation of his time between both companies.

These restrictions may limit our ability to pursue certain equity issuances, strategic transactions, repurchases or other transactions that we may otherwise believe to be in the best interests of our stockholders or that might increase the value of our business.

Actual or potential conflicts of interest may develop between our management and directors, on the one hand, and the management and directors of IAC, on the other hand.

Certain of our directors and executive officers and directors of IAC own both Match Group common stock and IAC common stock.

This ownership overlap could create, or appear to create, potential conflicts of interest when Match Group’s directors and IAC’s executive officers and directors face decisions that could have different implications for Match Group and IAC.

For example, potential conflicts of interest could arise in connection with the resolution of any dispute between Match Group and IAC regarding the terms of the agreements governing the Separation and the relationship between Match Group and IAC thereafter.

Potential conflicts of interest could also arise if Match Group and IAC enter into any commercial arrangements in the future.

In addition, Joseph Levin serves as the executive chairman of our board of directors, while also serving as the Chief Executive Officer and a director of IAC, Glenn H.

Schiffman serves as a director of Match Group while also serving as an executive officer of IAC, and Alan G.

Spoon serves as a director of each of Match Group and IAC.

We believe that having a limited number of senior IAC management members serve on our Board for a

transitional period will be beneficial to us.

However, the fact that Messrs.

Levin, Schiffman, and Spoon hold positions with both Match Group and IAC could create, or appear to create, potential conflicts of interest for each of them when facing decisions that may affect both Match Group and IAC, and each of them also faces conflicts of interest with regard to the allocation of his time between Match Group and IAC.

Our certificate of incorporation could prevent us from benefiting from corporate opportunities that might otherwise have been available to us.

Our certificate of incorporation includes a “corporate opportunity” provision in which Match Group and its affiliates renounce any interests or expectancy in corporate opportunities which become known to any of Match Group’s directors or officers who are also officers or directors of IAC.

Generally, Match Group’s officers or directors who are also IAC’s officers or directors will not be liable to Match Group or its stockholders for breach of any fiduciary duty because such person fails to communicate or offer to Match Group a corporate opportunity that has been communicated or offered to IAC, that may also be a corporate opportunity of Match Group or because such person communicates or offers to IAC any corporate opportunity that may also be a corporate opportunity of Match Group.

In order for any Match Group director or officer who is also an IAC director or officer not to be liable to Match Group or its stockholders, such opportunity cannot become known to the officer or director in his or her capacity as a Match Group director or officer and cannot be presented to any party other than IAC.

In addition, such officer or director cannot pursue such opportunity in his or her individual capacity.

The corporate opportunity provision may exacerbate conflicts of interest between Match Group and IAC because the provision effectively permits any of Match Group’s directors or officers who also serve as an officer or director of IAC to choose to direct a corporate opportunity to IAC instead of to Match Group.

Risks relating to ownership of our common stock

You may experience dilution due to the issuance of additional securities in the future .

Our dilutive securities consist of vested and unvested options to purchase shares of our common stock, restricted stock unit awards, equity awards denominated in the equity of our non-public subsidiaries but settleable in shares of our common stock, the exchangeable notes and the exchangeable note warrants.

These dilutive securities are reflected in our dilutive earnings per share calculation contained in our financial statements for fiscal years ended December 31, 2020, 2019 and 2018.

For more information, see “Note 10—Earnings per Share” to the consolidated financial statements included in “Part II, Item 8—Consolidated Financial Statements and Supplementary Data.” Intra-quarter movements in our stock price, could lead to more or less dilution than reflected in these calculations.

We do not expect to declare any regular cash dividends in the foreseeable future.

We have no current plans to pay cash dividends on our common stock.

Instead, we anticipate that all of our future earnings will be retained to support our operations and to finance the growth and development of our business.

We are not obligated to pay dividends on our common stock.

Consequently, investors may need to rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investment.

Investors seeking regular cash dividends should not purchase our common stock.

Provisions in our certificate of incorporation and bylaws or Delaware law may discourage, delay, or prevent a change of control of our company or changes in our management and, therefore, depress the trading price of our common stock.

Delaware corporate law and our certificate of incorporation and bylaws contain provisions that could discourage, delay or prevent a change in control of our company or changes in our management that the stockholders of our company may deem advantageous, including provisions which:

• authorize the issuance of “blank check” preferred stock that our board of directors could issue to increase the number of outstanding shares and to discourage a takeover attempt;

• establish a classified board of directors, as a result of which our board is divided into three classes, with each class serving for staggered three-year terms, which prevents stockholders from electing an entirely new board of directors at an annual meeting;

• prohibit stockholder action by written consent, thereby requiring all actions to be taken at a meeting of the stockholders;

• eliminate the ability of our stockholders to call special meetings of stockholders;

• provide that certain litigation against us can be brought only in Delaware (subject to certain exceptions);

• provide that the board of directors is expressly authorized to make, alter, or repeal our bylaws.

Any provision of our certificate of incorporation, our bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our common stock, and could also affect the price that some investors are willing to pay for our common stock.

Unresolved Staff Comments

Not applicable.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors