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Item 7. Management’s Discussion and Analysis

2026-02-25 compared with 2025-02-19 · 100 added, 176 removed, 284 unchanged (49% of the section changed)

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For a discussion of our financial condition and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024.

NerdWallet, Inc.

(NerdWallet, we, our, or us) provides consumers and small and mid-sized businesses (SMBs) with trusted guidance across a broad range of finance topics through a digital platform that integrates independent editorial content, comparison tools, data-driven product marketplaces, and access to regulated financial services offered through our subsidiaries.

Our mission is to provide clarity for all of life’s financial decisions.

Our vision is a world where everyone makes financial decisions with confidence.

At NerdWallet, we empower consumers—both individuals and small and mid-sized businesses (SMBs)—to make smarter financial decisions with confidence via our digital platform.

Technology, paired with the dramatic growth in innovative financial products, has changed the way consumers manage their financial lives;

consumers are more comfortable than ever comparing and shopping for financial products online.

At NerdWallet, we are leveraging this transformation to democratize access to trustworthy financial guidance by incorporating our proprietary data science models into our platform—ultimately helping to improve the financial well-being of consumers and the financial services industry as a whole.

In addition to our historical offerings, with our acquisition of Next Door Lending LLC (NDL) in October 2024, we expanded our offerings in the mortgage space to include mortgage lending services.

As the financial services industry becomes more fragmented and complex, we believe the need for trustworthy and knowledgeable financial guidance increases.

Our objective remains the same:

serve as a trusted financial ecosystem that consumers and SMBs can rely on to learn about various financial topics, shop for products, connect their data and receive data-driven nudges.

We deliver guidance to consumers through educational content, tools and calculators, product marketplaces and our app.

Our platform delivers unique value across many financial products, including credit cards, mortgages, insurance, SMB products, personal loans, banking, investing and student loans.

We expanded our guidance to the United Kingdom (UK) with our acquisition of Know Your Money (KYM) in 2020, and expanded organically into Canada during 2021 as well as Australia during 2022.

Across every touchpoint, the cornerstone of our platform is consumers’ trust in the independent, objective and relevant guidance we provide, free of charge.

This trusted guidance has helped us build a large, loyal and well-informed audience of consumers who turn to us as a resource for many of their money questions and to shop for the best financial products for them.

Due to this unique combination of a loyal audience, trusted guidance and tailored recommendations from our underlying machine learning technology, we have become an attractive partner for financial services providers wanting to access these high-value consumers—consumers who might not otherwise trust financial services providers’ recommendations.

By operating at the intersection of consumers and financial services providers, NerdWallet drives value for both.

Through our platform, our financial services partners can reach a substantial audience.

After doing research on our platform, consumers are better informed about the financial decision they’re about to make, which makes them primed and ready to transact.

Consumers who visit NerdWallet tend to share a few other characteristics that make them attractive customers to our financial services partners:

we have received feedback from our financial services partners that our users’ approval rates can be significantly higher than those applying through other channels and they are more eager to explore additional opportunities and products, driving demand for NerdWallet’s financial services partners.

Our Financial Model

We built our business to provide unbiased and trusted guidance to consumers.

Through this guidance, we attract users to our platform and use data science models to match them with relevant products from our financial services partners.

Given our mission is to provide clarity for all of life’s financial decisions, we take actions that aim to prioritize user experience over revenue per user.

We believe that taking a long-term view will increase our revenue and grow our business.

In addition, we do not always look to maximize the number of our financial services partners on our platform;

we instead aim to have products for consumers available on our platform that enable the best match.

We seek to increase the number of consumers who come to NerdWallet pursuing our financial content, guidance, and tech-driven recommendations.

We generate revenue by successfully matching those consumers with our financial services partners, from whom we generate fees.

These fees from which we recognize revenue include revenue per action, revenue per click, revenue per lead, and revenue per funded loan.

Key Factors Affecting Our Performance

Ability to Generate High Quality, Engaging Consumer Resources

Delivering financial guidance and resources on a broad set of topics is core to our value proposition.

In order to maintain our position as a trusted destination for personal and SMB financial guidance, we produce high-quality financial guidance, which is developed by our independent team of writers and editors.

Our editorial and product teams continuously improve our content, tools and resources to ensure that our platform reflects the latest consumer finance trends and related products from our financial services partners.

We plan to continue investing in our growing base of high-value content and tools, which enable us to generate more traffic, enhancing monetizing activities with our financial services partners and ultimately, our financial performance.

Ability to Attract and Engage Consumers

Our ability to increase user engagement, whether by increasing the frequency with which consumers and SMBs visit our platform, or the amount of resources they consume on our platform, is critical to the growth of our business.

We focus on attracting users to NerdWallet who are interested in multiple financial products that we review and then use machine learning to help them find financial products for their needs.

For example, if an individual comes to our platform to learn more about credit cards, we hope to bring that individual back to NerdWallet at a later time to explore other financial products, often via automated contextual “nudges.” Our ability to attract and engage those visitors directly impacts our ability to earn revenue from financial services partners.

As such, we plan to continue investing in content, technology and marketing in order to attract and engage consumers.

Ability to Deepen Our Relationships with Our Financial Services Partners

We worked wit h hundreds of financial services partners during 2024.

These companies are essential to helping us serve consumers and grow our business .

Having a broad range of financial services partners across all of our verticals is important in offering consumers a wide selection of attractive products.

Furthermore, all of our revenue is generated from our financial services partners, and as such, relationships with new and existing financial services partners are critical to the success of our business.

We continuously aim to selectively add new financial services partners to our platform and to add coverage for additional verticals from existing partners.

That said, maximizing the number of our financial services partners on our platform isn’t our primary focus—our focus is quality, and we aim to offer all of the top financial products on our platform .

The success of our relationships with financial services partners is in large part based on our ability to provide them with interested and qualified consumers.

Economic Conditions and the Financial Well-Being of Consumers

Our business is reliant on economic conditions in the U.S.

Any changes in the financial well-being of consumers, including as a result of inflation, economic recession, unemployment, government stimulus, or changes in monetary policy will affect the demand for various financial services products and therefore impact the number of individuals visiting our platform and our ability to earn revenue from matches completed on our platform.

In particular, fluctuations in interest rates affect many of the products offered by our financial services partners, especially mortgages, personal loans, and banking products.

Typically, when interest rates decline, we see accelerated consumer demand for loans which in turn leads to increased traffic to our platform.

Conversely, when interest rates increase, we see slowed consumer demand for loans and accelerated demand for banking products.

Our marketing strategy leverages multiple channels across brand marketing, performance marketing and organic marketing.

Sales and marketing expense consists of:

brand marketing, primarily advertising costs to increase brand awareness;

performance marketing, primarily costs to drive traffic directly to our platform;

and organic and other, primarily personnel-related costs for content and other marketing and sales teams.

In 2024, approximately 15% of our total marketing expense was attributable to brand marketing, 63% to performance marketing, and the remainder to organic and other marketing expenses.

In 2023, approximately 21% of our total marketing expense was attributable to brand marketing, 51% to performance marketing, and the remainder to organic and other marketing expenses.

We evaluate the success of our brand marketing by measuring aided brand awareness, which has grown consistently on an annual basis since 2019.

We are able to adjust our marketing spend to reflect changes in external factors and consumer behavior.

Performance marketing spend can be adjusted more quickly than brand marketing, which typically involves pre-committing to spend in future periods.

We increased sales and marketing expense in 2023 by 7% compared to 2022, and in 2024 by 17% compared to 2023.

In 2024, over 70% of all traffic to NerdWallet came organically through direct or unpaid channels, reflecting the strength of our brand and organic marketing efforts.

Our in-house, award-winning and experienced editorial team leverages search-engine optimization best practices and technology, and designs interfaces to help consumers easily find the information they are seeking.

Our editorial team also optimizes page structure to increase visibility, not only for organic search results, but also for Google’s premium features such as FAQs, featured snippets, and video results.

Personnel-related expenses within organic marketing reflect our continued investment in building a comprehensive set of skills and expertise across our editorial team.

We will continue to invest in our marketing channels going forward, and believe that our marketing strategy will continue to position NerdWallet as the trusted brand of choice in personal finance, improve traffic acquisition at all levels of the funnel, drive engagement and enable us to scale quickly across new consumer finance verticals and geographies.

We have made acquisitions to expand into new verticals;

to enter new markets and geographies;

Our platform enables users to compare financial products, access educational resources, receive personalized insights, and connect with third-party providers across credit cards, banking, insurance, lending, investing, wealth management, and other financial categories.

We generate revenue primarily through referral fees, lead generation, and partner-based monetization, as well as through revenue derived from brokering and advisory services.

Our business model is designed to be partner-neutral and to support transparent consumer and SMB choice by offering side-by-side comparisons and unbiased information supported by editorial standards.

We have made acquisitions and established subsidiaries to expand into new verticals;

to enter new markets;

and to grow our platform so that our users have better outcomes.

Our recent acquisitions include:

Recent acquisitions include:

• Next Door Lending.

In October 2024, we acquired NDL, a mortgage broker that offers a selection of loan products for home purchase and refinance, including cash-out refinance and debt consolidation, across a range of maturities and interest rates.

In October 2024, we acquired Next Door Lending LLC (NDL), a mortgage broker that offers a selection of loan products for home purchase and refinance, including cash-out refinance and debt consolidation, across a range of maturities and interest rates.

Through NDL, we offer consumers access to government-sponsored entity-conforming loans, FHA insured loans, VA guaranteed loans and jumbo loans.

• On the Barrelhead.

In July 2022, we acquired On the Barrelhead, Inc.

(OTB), a data-driven platform that provides consumers and SMBs with credit-driven product recommendations.

Given the success of our Fundera acquisition within our SMB products verticals, we are leveraging our vertical integration playbook to fully integrate OTB’s technology and expertise within our Loans portfolio.

By pairing OTB’s loan matching platform with NerdWallet’s trusted brand and massive reach, we can offer our users more personalized and compelling recommendations, leading to better customer experiences and improved monetization.

In October 2020, we acquired Fundera, Inc.

(Fundera), an online platform which connects SMBs with lenders and other resources.

Fundera’s SMB-focused advice and loan comparison offerings, together with its strong brand and consultative sales approach, enables us to better support SMBs.

This acquisition is a first step to enable deeper integration within existing verticals, which couples our top of funnel strength with Fundera ’ s monetization strategy, including recurring revenue from loan renewals.

Combining the strengths of each business will allow NerdWallet to accelerate our growth in the SMB market, and will also serve as a playbook for further vertical integrations.

• Know Your Money.

In September 2020, we acquired Notice Media Ltd.

(doing business as Know Your Money), an online provider of financial guidance and tools geared towards consumers and SMBs in the UK.

KYM’s UK expertise and NerdWallet’s existing brand recognition have provided us a strong foothold in the UK region.

We believe the acquisition will allow us to accelerate our international growth.

• NerdWallet Insurance Experts .

In March 2025, we established NerdWallet Insurance Experts, LLC (NWIE), an insurance agency.

Through NWIE, we provide property and casualty brokerage services to assist consumers to compare quotes and connect with licensed carriers or agents to obtain insurance policies.

• NerdWallet Wealth Partners .

In June 2025, we acquired an SEC-registered investment adviser and created NerdWallet Wealth Partners, LLC, which provides traditional investment advisory services, such as financial planning and discretionary investment management.

Non-GAAP Financial Measures

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Non-GAAP operating income (loss):

We define non-GAAP operating income (loss) as income (loss) from operations adjusted to exclude depreciation and amortization, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) change in fair value of contingent consideration related to earnouts, (4) deferred compensation related to earnouts, (5) acquisition-related costs, and (6) restructuring charges.

We define non-GAAP operating income (loss) as income (loss) from operations adjusted to exclude depreciation and amortization, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) acquisition-related costs, and (4) restructuring charges.

We also reduce income from operations, or increase loss from operations, for capitalized internally developed software costs.

Adjusted EBITDA:

We define adjusted EBITDA as net income (loss) from continuing operations adjusted to exclude depreciation and amortization, interest income (expense), net, other gains (losses), net, and provision (benefit) for income taxes, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) change in fair value of contingent consideration related to earnouts, (4) deferred compensation related to earnouts, (5) stock-based compensation, (6) acquisition-related costs, and (7) restructuring charges.

We define adjusted EBITDA as net income (loss) from continuing operations adjusted to exclude depreciation and amortization, interest income (expense), net, other gains (losses), net, and provision (benefit) for income taxes, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) stock-based compensation, (4) acquisition-related costs, and (5) restructuring charges.

The above items are excluded from our non-GAAP operating income (loss) and adjusted EBITDA measures because these items are non-cash in nature, or because the amounts are not driven by core operating results and renders comparisons with prior periods less meaningful.

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Although these are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and non-GAAP operating income (loss) and adjusted EBITDA do not reflect all cash requirements for such replacements or for new capital expenditure requirements;

• Non-GAAP operating income (loss) and adjusted EBITDA exclude certain acquisition-related costs, including acquisition-related retention compensation under compensatory retention agreements with certain key employees, acquisition-related transaction expenses, contingent consideration fair value adjustments related to earnouts, and deferred compensation related to earnouts;

• Non-GAAP operating income (loss) and adjusted EBITDA exclude restructuring charges primarily consisting of severance payments, stock-based compensation, employee benefits, and related expenses for impacted employees, as well as contract termination costs, associated with our Restructuring Plan;

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We generate substantially all of our revenue through fees paid by our financial services partners in the form of either revenue per action, revenue per click, revenue per lead, and revenue per funded loan arrangements.

For these revenue arrangements, in which a partner pays only when a consumer satisfies the criteria set forth within the arrangement, revenue is recognized generally when we match the consumer with the financial services partner.

For these revenue arrangements, in which a partner pays only when a consumer or SMB satisfies the criteria set forth within the arrangement, revenue is recognized generally when we match the consumer or SMB with the financial services partner.

For some of our arrangements, the transaction price is considered variable and an estimate of the constrained transaction price is recorded when the match occurs.

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Cost of revenue

Cost of revenue consists primarily of amortization expense associated with capitalized software development costs and developed technology intangible assets related to our acquisitions, credit scoring fees, account linking fees , and third-party data center costs.

We expect our cost of revenue to increase in absolute dollars for the foreseeable future to the extent that our business continues to grow.

We expect our cost of revenue to vary as a percentage of revenue in the near term, and it may eventually decrease over time as a percentage of revenue as our business grows and recognizes economies of scale.

However, this percentage may fluctuate from year to year depending on the timing and extent of our investments in experiences requiring third-party data, credit scoring and account linking fees.

We expect our cost of revenue to decrease in absolute dollars in the next few years, as amortization of capitalized software development costs decline following years of decreasing levels of capitalized software development costs, and to then increase in absolute dollars for the foreseeable future to the extent that our business continues to grow.

We expect our cost of revenue to vary as a percentage of revenue in the next few years, and it may eventually decrease over time as a percentage of revenue as our business grows and recognizes economies of scale.

However, this percentage may fluctuate from year to year depending on the timing and extent of our investments in experiences requiring third-party service and data costs.

Research and development

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Sales and marketing

Sales and marketing expenses include advertising and promotion costs, costs related to brand campaign fees, marketing, business operations team, and editorial personnel and related costs, including stock-based compensation.

Our marketing strategy leverages multiple channels across brand marketing, performance marketing and organic marketing.

Sales and marketing expenses consist of:

performance marketing, primarily costs to drive traffic directly to our platform;

brand marketing, primarily advertising costs to increase brand awareness;

and organic and other marketing, primarily personnel-related costs, including stock-based compensation, for content and other marketing and sales teams.

We are able to adjust our marketing spend to reflect changes in external factors and consumer and SMB behavior.

Performance marketing spend can be adjusted more quickly than brand marketing, which typically involves pre-committing to spend in future periods.

We expect our sales and marketing expenses to continue to increase in absolute dollars for the foreseeable future, primarily to support the growth of our existing business and expansion into new verticals.

Over time, we expect sales and marketing expenses to decrease as a percentage of revenue as our business grows and recognizes economies of scale.

Over time, we expect our sales and marketing expenses to increase as a percentage of revenue as our business grows and expands.

However, this percentage may fluctuate from period to period depending on the timing and extent of our sales and marketing expenses.

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We expect our general and administrative expenses to increase in absolute dollars for the foreseeable future primarily to support the growth of our business.

Additional expenses may include increased headcount, enhanced systems, processes, and controls as well as increased expenses in the areas of insurance, compliance, investor relations, and professional services.

Additional expenses may include increased personnel-related costs, enhanced systems, processes, and controls as well as increased expenses in the areas of insurance, compliance, investor relations, and professional services.

For these reasons, we expect general and administrative expenses to vary as a percentage of revenue in the near term, but eventually to decrease as a percentage of revenue as our business grows and recognizes economies of scale.

This percentage may fluctuate from period to period depending on the timing and extent of our general and administrative expenses.

Change in fair value of contingent consideration related to earnouts

Our acquisitions of Fundera and KYM included earn-out provisions which required us to pay additional consideration based on the achievement of certain performance measures for a stated period after the acquisition date.

We measured this contingent consideration at fair value as of the acquisition date and record it as a liability on our consolidated balance sheet.

The fair value of each contingent consideration liability is remeasured at the end of each reporting period, with any changes in fair value recognized as income or expense from operations in our consolidated income statement.

As of December 31, 2022, Fundera’s revenue and profitability milestones for 2022 were achieved and the contingent consideration liability was recorded at the full payout amount, with the contingent consideration liability paid in full during 2023.

Other income (expense), net

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56.3 61.6 59.8

Change in fair value of contingent consideration related to earnouts — — 6.7

Total costs and expenses 771.4 678.2 595.8

Income (loss) from operations 9.4 3.6 (19.0)

Income from Operations

Other income (expense), net:

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Interest expense (0.6) (0.7) (0.8)

Other losses, net

Other gains (losses), net

0.4 (8.5) (0.1)

Total other income (expense), net 3.0 (4.4) 2.7

Income (loss) before income taxes 5.0 6.3 (20.0)

Income before income taxes

Income tax provision (benefit) 19.5 (25.4) 18.1

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General and administrative 7 9 10

Change in fair value of contingent consideration related to earnouts — — 1

Total costs and expenses 92 99 99

Income (loss) from operations 1 1 (4)

Income from Operations

Other income (expense), net:

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Interest expense — — —

Other losses, net

Other gains (losses), net

Total other income (expense), net — — —

Income (loss) before income taxes 1 1 (4)

Income before income taxes

Income tax provision (benefit) 2 (3) 3

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Our income from operations increased $55.8 million, or 590%, for 2025 compared to 2024.

The increase was driven by an $88.2 million increase in revenues, partially offset by an $82.4 million increase in costs and operating expenses, primarily due to increases of $69.1 million in sales and marketing expenses and $9.5 million in cost of revenue.

We had net income of $30.4 million for 2024, as compared to a net loss of $11.8 million for 2023.

The change reflects a $5.8 million increase in income from operations, and $4.4 million of other expense, net in 2024 as compared to other income, net of $2.7 million in 2023, which were more than offset by a $25.4 million income tax benefit in 2024 as compared to an income tax provision of $18.1 million in 2023.

The increase was driven by a $149.0 million increase in revenues, partially offset by a $93.2 million increase in costs and operating expenses, primarily due to a $114.1 million increase in sales and marketing expenses partially offset by a $15.8 million decrease in research and development expenses.

Our net income increased $18.3 million, or 60%, for 2025 compared to 2024, primarily driven by the $55.8 million increase in income from operations, as well as $3.0 million of other income, net in 2025 as compared to other expense, net of $4.4 million in 2024, partially offset by a $19.5 million income tax provision in 2025 as compared to an income tax benefit of $25.4 million in 2024.

Comparison of the Years Ended December 31, 2025 and 2024

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Total revenue $ 836.6 $ 687.6 $ 149.0 22 %

Revenue increased $88.2 million, or 15%, for 2024 compared to 2023, driven by strong growth in Insurance products revenue as well as SMB products revenues, partially offset by lower Credit cards, Loans and Emerging verticals revenues.

Revenue increased $149.0 million, or 22%, for 2025 compared to 2024, driven by strong growth in Insurance, Emerging verticals and Loans revenues, partially offset by lower Credit cards and SMB products.

Insurance revenue increased $89.2 million, or 47%, for 2025 compared to 2024, primarily driven by a strong increase in auto insurance products revenue as carriers expanded budgets.

Credit cards revenue decreased $33.3 million, or 16%, for 2024 compared to 2023, primarily due to pressures in organic search traffic and reduced marketing spending by our financial services partners amidst a cautious underwriting environment.

SMB products revenue increased $8.6 million, or 9%, for 2024 compared to 2023, primarily driven by revenue growth in products such as business credit cards, loan renewals and banking as we continue to scale our product offerings, partially offset by a decrease in business loan originations.

Loans revenue decreased $17.1 million, or 17%, for 2024 compared to 2023, primarily due to a 32% decrease in personal loans revenue as we continue to work through a high interest rate environment, partially offset by higher mortgage loans revenue from both organic growth as well as incorporating our acquisition of NDL in October 2024.

Emerging verticals revenue decreased $16.6 million, or 12%, for 2024 compared to 2023, primarily due to a 14% decrease in banking revenue as consumer demand for banking products continued to moderate.

Credit cards revenue decreased $43.0 million, or 24%, for 2025 compared to 2024, primarily due to continued pressures in organic search traffic.

SMB products revenue decreased $9.8 million, or 9%, for 2025 compared to 2024, primarily due to continued pressures in organic search traffic, partially offset by an increase in business loan originations.

Loans revenue increased $48.9 million, or 58%, for 2025 compared to 2024, primarily driven by an 85% increase in personal loans revenue as well as a 33% increase in mortgage loans revenue reflecting incorporation of our acquisition of NDL in October 2024.

Emerging verticals revenue increased $63.7 million, or 51%, for 2025 compared to 2024, primarily driven by a 60% increase in banking revenue due to higher demand for banking products.

Costs and Expenses

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Cost of revenue

Cost of revenue increased $9.5 million, or 17%, for 2024 compared to 2023.

The increase was primarily attributable to increases of $6.5 million primarily related to third-party service charges and $3.9 million in amortization expense related to capitalized software development costs, partially offset by a $1.6 million decrease in amortization expense related to intangible assets.

Cost of revenue increased $0.2 million for 2025 compared to 2024.

The increase was primarily attributable to a $2.1 million increase related to third-party service and data charges, substantially offset by a $1.6 million decrease in amortization expense related to capitalized software development costs.

Research and development expense

Research and development expenses increased $2.0 million, or 3%, for 2024 compared to 2023.

The increase was primarily attributable to a $5.8 million restructuring charge as well as a $1.8 million increase in software and technology costs related to our platform, partially offset by a $4.0 million decrease in personnel-related costs for our engineering, data, and product management personnel and contractors.

Research and development expenses decreased $15.8 million, or 19%, for 2025 compared to 2024.

The decrease was primarily attributable to a $10.1 million decrease in personnel-related costs for our engineering, data, and product management personnel and contractors, as well as a $5.8 million restructuring charge in 2024.

Sales and marketing expense

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Total sales and marketing $ 584.7 100 % $ 470.6 100 %

We are able to adjust our marketing spend to reflect changes in external factors and consumer behavior.

We are able to adjust our marketing spend to reflect changes in external factors and consumer and SMB behavior.

Sales and marketing expenses increased $114.1 million, or 24%, for 2025 compared to 2024.

The increase was attributable to a $90.9 million increase in performance marketing expenses, partially offset by decreases of $15.8 million in brand marketing expenses and $6.0 million in organic and other marketing expenses primarily due to lower personnel-related costs partially offset by a $2.0 million restructuring charge.

The increase was attributable to a $119.5 million increase in performance marketing expenses, partially offset by decreases of $3.5 million in brand marketing expenses and $1.9 million in organic and other marketing expenses primarily due to a $2.0 million restructuring charge in 2024.

General and administrative expense

General and administrative expenses increased $1.8 million, or 3%, for 2024 compared to 2023, primarily attributable to a $1.2 million restructuring charge as well as higher personnel-related costs mainly due to stock-based compensation.

General and administrative expenses decreased $5.3 million, or 9%, for 2025 compared to 2024, primarily attributable to a $5.5 million decrease in personnel-related costs mainly due to stock-based compensation, as well as a $1.2 million restructuring charge in 2024.

Other income (expense), net

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Interest expense (0.6) (0.7) 0.1 (9 %)

Other losses, net

Other (gains) losses, net

0.4 (8.5) 8.9 NM

Total other income (expense), net $ 3.0 $ (4.4) $ 7.4 NM

The change in other income (expense), net for 2024 compared to 2023 was primarily attributable to an $8.1 million impairment on an equity investment, partially offset by higher interest income reflecting higher interest rates and average cash balances.

The change in other income (expense), net for 2025 compared to 2024 was primarily attributable to an $8.1 million impairment on an equity investment in 2024, partially offset by lower interest income reflecting lower interest rates and average cash balances.

Income tax provision (benefit)

We had an income tax benefit of $25.4 million for 2024, as compared to an income tax provision of $18.1 million in 2023.

We had an income tax provision of $19.5 million for 2025, as compared to an income tax benefit of $25.4 million in 2024.

Our effective tax rate was 28.6% and (505.5%) for 2025 and 2024, respectively, as compared to the U.S.

federal statutory income tax rate of 21%.

Our effective tax rate for 2025 is higher than the U.S.

federal statutory income tax rate of 21% primarily due to permanent impacts related to stock-based compensation and state taxes, partially offset by research and development credits.

Our effective tax rate for 2024 differs from the U.S.

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federal and majority state deferred tax assets are realizable, resulting in a valuation allowance release of $27.2 million.

Our effective tax rate for 2023 differs from the U.S.

federal statutory income tax rate of 21% primarily due to the valuation allowance previously maintained against our net U.S.

deferred tax assets and state taxes, partially offset by research and development credits.

Our tax benefit for 2023 primarily resulted from the requirement for us to capitalize and amortize research and development expenses, and an overall increase in our profitability before taxes.

As a result, we recorded a significant U.S.

current tax provision in 2023 with no corresponding deferred tax benefit for such capitalized expenses due to the valuation allowance maintained against our net U.S.

deferred tax assets.

On July 4, 2025, the United States enacted tax reform legislation through An Act to Provide for Reconciliation Pursuant to Title II of H.

14, commonly known as the One Big Beautiful Bill Act.

Included in this legislation are provisions that allow for the immediate expensing of domestic U.S.

research and development expenses, immediate expensing of certain capital expenditures, and other changes to the U.S.

taxation of profits derived from foreign operations.

We have incorporated the new legislation into our income tax provision, as applicable, and determined that there was no material impact on our tax provision for 2025.

Non-GAAP Financial Measures

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Year Ended December 31, 2025 2024 2023

Income (loss) from operations

Income from Operations

$ 65.2 $ 9.4 $ 3.6

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Acquisition-related retention 1.6 4.2 5.3

Deferred compensation related to earnouts — — 1.7

Acquisition-related expenses 2.3 0.6 0.1

Impairment of right-of-use asset

Loss on disposal of assets 0.4 — 0.2

Change in fair value of contingent consideration related to earnouts — — 6.7

Acquisition-related expenses 0.6 0.1 3.5

Restructuring

Capitalized internally developed software costs (20.4) (24.0) (32.4)

Non-GAAP operating income (loss) $ 47.6 $ 26.4 $ (1.0)

Operating income (loss) margin

1 % 1 % (4 %)

Non-GAAP operating income (loss) margin 1

Non-GAAP Operating Income

$ 96.0 $ 47.6 $ 26.4

Operating income margin

Non-GAAP operating income margin 1

Net Income (Loss)

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Acquisition-related retention 1.6 4.2 5.3

Deferred compensation related to earnouts — — 1.7

Acquisition-related expenses 2.3 0.6 0.1

Impairment of right-of-use asset — — 1.4

Loss on disposal of assets 0.4 — 0.2

Change in fair value of contingent consideration related to earnouts — — 6.7

Acquisition-related expenses 0.6 0.1 3.5

Restructuring

Interest (income) expense, net

Interest income, net

(2.6) (4.1) (2.8)

Other losses, net

Other gains (losses), net

(0.4) 8.5 0.1

Income tax provision (benefit) 19.5 (25.4) 18.1

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(20.4) (24.0) (32.4)

Non-GAAP operating income (loss)

$ 47.6 $ 26.4 $ (1.0)

Non-GAAP Operating Income $ 96.0 $ 47.6 $ 26.4

Net income (loss) margin

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Our non-GAAP operating income increased $48.4 million, or 102%, for 2025 compared to 2024.

The increase was driven by increases of $5.8 million in income from operations, and $15.4 million in adjustments to reconcile income from operations to non-GAAP operating income, including a $9.0 million restructuring charge and an $8.4 million decrease in capitalized internally developed software costs..

The increase was driven by a $55.8 million increase in income from operations, partially offset by a $7.4 million decrease in adjustments to reconcile income from operations to non-GAAP operating income, including a $9.0 million restructuring charge in 2024.

Adjusted EBITDA increased $37.1 million, or 35%, for 2025 compared to 2024.

The increase was primarily attributable to net income of $30.4 million for 2024, as compared to a net loss of $11.8 million for 2023, partially offset by a decrease in adjustments to reconcile adjusted EBITDA to net income (loss), including $43.5 million for income taxes and $2.5 million for stock-based compensation, partially offset by a $9.0 million restructuring charge and an $8.4 million increase in other losses, net.

The increase was attributable to increases of $18.3 million in net income and $18.8 million in adjustments to reconcile adjusted EBITDA to net income, primarily including $44.9 million for income taxes partially offset by a $9.0 million restructuring charge and an $8.1 million impairment on an equity investment, both in 2024, as well as a $7.7 million decrease for stock-based compensation.

Liquidity and Capital Resources

Our principal sources of liquidity to meet our business requirements and plans, both in the short-term (i.e., the next twelve months from December 31, 2024) and long-term (i.e., beyond the next twelve months), have historically been cash generated from operations and, more recently, borrowings under our credit facilities.

Our primary liquidity needs are related to the funding of general business requirements, including working capital requirements, research and development, and capital expenditures, as well as other liquidity requirements including, but not limited to, business combinations.

Our principal sources of liquidity to meet our business requirements and plans, both in the short-term (i.e., the next twelve months from December 31, 2025) and long-term (i.e., beyond the next twelve months), have historically been cash generated from operations.

As of December 31, 2025 and 2024, we had cash and cash equivalents of $98.3 million and $66.3 million, respectively.

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A description of contractual commitments as of December 31, 2025 is included in Note 8–Commitments and Contingencies in the notes to the consolidated financial statements.

More broadly, we also have purchase obligations under contractual arrangements with vendors and service providers, including for certain web-hosting and cloud computing services, which do not qualify for recognition on our consolidated balance sheet but which we consider non-cancellable.

As of December 31, 2024, amounts to be spent under non-cancellable purchase obligations were $18.4 million over the next twelve months, and approximately $9 million in 2026.

More broadly, we also have purchase obligations under contractual arrangements with vendors and service providers, including for certain web-hosting and cloud computing services and advertising, which do not qualify for recognition on our consolidated balance sheet but which we consider non-cancellable.

As of December 31, 2025, amounts to be spent under non-cancellable purchase obligations were $13.5 million over the next twelve months, and approximately $4 million in 2027 and $1 million in 2028.

Trends, Uncertainties and Anticipated Sources of Funds

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Share Repurchase Program:

We announced on May 2, 2023 that our Board of Directors authorized a plan under which we may repurchase up to $20 million of our Class A common stock and, following our utilization of that share repurchase authorization, we announced on October 26, 2023, September 9, 2024 and October 29, 2024 that our Board of Directors approved additional share repurchase authorizations under which we may repurchase up to an additional $30 million, $50 million and $25 million, respectively, of our Class A common stock (collectively, the Repurchase Program).

We announced on May 2, 2023 that our Board of Directors authorized a plan under which we may repurchase up to $20 million of our Class A common stock and, following our utilization of that share repurchase authorization, we announced on October 26, 2023, September 9, 2024, October 29, 2024, September 13, 2025, and December 16, 2025 that our Board of Directors approved additional share repurchase authorizations under which we may repurchase up to an additional $30 million, $50 million, $25 million, $50 million, and $50 million, respectively, of our Class A common stock (collectively, the Repurchase Program).

Subject to market conditions and other factors, the Repurchase Program is intended to make opportunistic repurchases of our Class A common stock to reduce our outstanding share count.

Under the Repurchase Program, shares of Class A common stock may be repurchased in the open market through privately negotiated transactions or otherwise, in accordance with applicable securities laws and other restrictions.

The Repurchase Program does not have fixed expiration dates and does not obligate us to acquire any specific number of shares.

The timing and terms of any repurchases under the Repurchase Program are at management’s discretion and depend on a variety of factors, including business, economic and market conditions, regulatory requirements, prevailing stock prices and other considerations.

Under the Repurchase Program, shares of Class A common stock may be repurchased from time to time in the open market through privately negotiated transactions or otherwise, in accordance with applicable securities laws and other restrictions.

The Repurchase Program does not have fixed expiration dates, does not obligate us to acquire any specific dollar amount or number of shares, and may be amended, suspended or discontinued at any time.

The amount and timing of any repurchases are at management’s discretion and depend on a variety of factors, including business, economic and market conditions, regulatory requirements, prevailing stock prices and other considerations.

Additionally, we may, from time to time, enter into Rule 10b5-1 trading plans to facilitate repurchases.

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During 2025, we repurchased 5.8 million shares of Class A common stock for $70.3 million, including costs associated with the repurchases.

We believe our current cash and cash equivalents and future cash flow from operations, as well as access to our credit facility with JPMorgan Chase Bank and a syndicate of other lenders, subject to customary borrowing conditions, will be sufficient to meet our ongoing working capital, capital expenditure and other liquidity requirements for the next twelve months and beyond.

Additionally, we paid $0.3 million of excise taxes during 2025 which related to previous share repurchases.

On February 20, 2026, our Board of Directors approved an increase in the share repurchase authorization under which we may repurchase up to an additional $100.0 million of our Class A common stock under the Repurchase Program.

Between January 1, 2026 and February 23, 2026, we repurchased 4.5 million shares of Class A common stock for $50.6 million, including costs associated with the repurchases.

The remaining share repurchase authorization under the Repurchase Program is $104.7 million as of February 23, 2026.

Credit Facility:

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Warehouse Line of Credit:

NDL, a wholly-owned subsidiary, maintains a $15.0 million warehouse line of credit to provide NDL short-term funding for mortgage loans originated for sale.

Borrowings under the warehouse line of credit bear interest at the greater of the interest rate of the underlying mortgage loans held for sale or a minimum rate of 6%, and are secured by the underlying promissory notes of the mortgage loans held for sale as well as NDL’s other assets.

NDL, a wholly-owned subsidiary, maintains a $15.0 million warehouse line of credit, which may be increased to $18.75 million for up to 90 days subject to certain requirements, to provide NDL short-term funding for mortgage loans originated for sale.

Borrowings under the warehouse line of credit bear interest at the greater of the interest rate of the underlying mortgage loans held for sale, subject to a 5.25% minimum rate, and are secured by the underlying promissory notes of the mortgage loans held for sale, as well as NDL’s other assets.

The warehouse line of credit matures on February 1, 2027.

NDL had $2.5 million outstanding under the warehouse line of credit as of December 31, 2024, which is included in accrued expenses and other current liabilities on our consolidated balance sheet.

NDL had $6.9 million and $2.5 million outstanding under the warehouse line of credit with a weighted-average interest rate of 6.27% and 6.77% as of December 31, 2025 and 2024, respectively, which is included in accrued expenses and other current liabilities on our consolidated balance sheet.

The warehouse line of credit requires NDL to comply with certain minimum tangible net worth, liquidity and insurance requirements.

NDL was in compliance with all covenants as of December 31, 2024.

NDL was in compliance with all covenants as of December 31, 2025 and 2024, respectively.

See Note 7–Debt in the notes to the consolidated financial statements for further discussion.

Our future capital requirements may vary materially from those planned and will depend on certain factors, such as our growth and our operating results.

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Operating activities

Net cash provided by operating activities decreased $0.3 million in 2024 compared to 2023 as the impact of net income of $30.4 million in 2024 as compared to a net loss of $11.8 million in 2023 was more than offset by a $41.4 million decrease in non-cash charges and a $1.1 million increase in net cash outflow from changes in operating assets and liabilities.

The decrease in non-cash charges was primarily due to a $45.6 million decrease in deferred taxes, partially offset by a $5.7 million increase in other losses, net.

The increase in net cash outflow from changes in operating assets and liabilities was primarily due to increases of $37.7 million for accounts receivable and $5.1 million for other liabilities, partially offset by decreases of $14.9 million for accrued expenses and other current liabilities, $8.4 million for accounts payable, $2.6 million for prepaid expenses and other current assets, and $2.1 million for mortgage loans held for sale, as well as a $14.0 million payment for contingent consideration in 2023.

Net cash provided by operating activities increased $59.8 million in 2025 compared to 2024, as increases of $18.3 million in net income and $44.2 million in non-cash charges were partially offset by a $2.7 million increase in net cash outflow from changes in operating assets and liabilities.

The increase in non-cash charges was primarily due to a $62.1 million increase in deferred taxes, partially offset by decreases of $9.1 million for stock-based compensation and $6.8 million in other losses, net.

The increase in net cash outflow from changes in operating assets and liabilities was primarily due to increases of $10.2 million for accounts payable, $6.6 million for mortgage loans held for sale, and $2.7 million for accrued expenses and other current liabilities, partially offset by a $17.6 million decrease for accounts receivable.

Investing activities

Net cash used in investing activities increased $0.2 million in 2024 compared to 2023, primarily due to an $8.1 million purchase of an investment and $0.3 million of cash paid, net of cash acquired, for our acquisition of NDL in 2024, substantially offset by an $8.1 million decrease in capitalized software development costs.

Net cash used in investing activities increased $3.6 million in 2025 compared to 2024, primarily due to $12.8 million of cash paid, net of cash acquired, for acquisitions, partially offset by decreases of $6.1 million in purchases of investments and $3.8 million in capitalized software development costs.

Financing activities

Net cash used in financing activities increased $50.3 million in 2024, primarily due to a $60.1 million increase in repurchases of Class A common stock, a $3.9 million decrease from exercises of stock options and a $2.0 million net payment on our warehouse line of credit, partially offset by a $16.9 million payment in 2023 for contingent consideration recorded at the acquisition date.

Net cash used in financing activities decreased $10.4 million in 2025, primarily due to decreases of $9.9 million in repurchases of Class A common stock and $6.4 million related to our warehouse line of credit, partially offset by a $5.2 million decrease from exercises of stock options.

Critical Accounting Policies and Estimates

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deferred tax assets as of December 31, 2023.

During the three months ended December 31, 2024, we concluded that it was more likely than not that our net U.S.Federal and majority state deferred tax assets would be realized, with a significant improvement in our profitability, coupled with anticipated future earnings, deemed to provide positive evidence to support sufficient taxable income in future periods, and accordingly we recorded a valuation allowance release of $27.2 million.

During the three months ended December 31, 2024, we concluded that it was more likely than not that our net U.S.

Federal and majority state deferred tax assets would be realized, with a significant improvement in our profitability, coupled with anticipated future earnings, deemed to provide positive evidence to support sufficient taxable income in future periods, and accordingly we recorded a valuation allowance release of $27.2 million.

We continue to maintain a valuation allowance on our California deferred tax assets, which consist primarily of tax credits, as of December 31, 2025.

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JOBS Act Accounting Election

We are an emerging growth company, as defined in the JOBS Act.

We are an emerging growth company, as defined in the JOBS Act, until December 31, 2026.

Under the JOBS Act, emerging growth companies can delay adopting new or revised accounting standards until such time as those standards apply to private companies.

We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in the JOBS Act.

We have elected to use this extended transition period for complying with new or revised accounting standards that have different effective dates for public and private companies.

As a result, our financial statements may not be comparable to companies that comply with new or revised accounting pronouncements as of public company effective dates.

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 7. Management’s Discussion and Analysis