37 unchanged sentences
During 2024, the challenging interest rate environment and inflationary pressures have continued to present challenges for many of our mortgage lending partners.
−Removed: In our Home segment, mortgage rates have remained relatively consistent in the first and second quarters of 2024 compared to the fourth quarter of 2023, but nearly doubled compared to the first quarter of 2022.
+Added: In our Home segment, mortgage rates decreased slightly in the third quarter of 2024 compared to the fourth quarter of 2023, but more than doubled compared to the low rates seen in the third quarter of 2021.
The increased mortgage rates continue to cause reduced refinance volumes and continue to put pressure on purchase activity.
−Removed: In our Insurance segment, demand from our carrier partners has increased significantly and we continue to be optimistic about the second half of 2024.
+Added: In our Insurance segment, demand from our carrier partners has increased significantly and we continue to be optimistic about the remainder of 2024.
Segment Reporting
14 unchanged sentences
We dynamically adjust selling and marketing expenditures in all interest rate environments to optimize our results against these variables.
−Removed: According to Freddie Mac, the monthly average 30-year mortgage interest rates increased slightly from a monthly average of 6.82% in December 2023 to a monthly average of 6.92% in June 2024.
−Removed: On a quarterly basis, 30-year mortgage interest rates in the second quarter of 2024 averaged 6.99%, compared to 6.49% in the second quarter of 2023 and 7.29% in the fourth quarter of 2023.
+Added: According to Freddie Mac, the monthly average 30-year mortgage interest rates decreased from a monthly average of 6.82% in December 2023 to a monthly average of 6.18% in September 2024.
+Added: On a quarterly basis, 30-year mortgage interest rates in the third quarter of 2024 averaged 6.51%, compared to 7.04% in the third quarter of 2023 and 7.29% in the fourth quarter of 2023.
Typically, as mortgage interest rates rise, there are fewer consumers in the marketplace seeking refinancings and, accordingly, the mix of mortgage origination dollars will move toward purchase mortgages.
−Removed: According to Mortgage Bankers Association (“MBA”) data, total refinance origination dollars increased to 22% of total mortgage origination dollars in the second quarter of 2024 compared to 19% in the fourth quarter of 2023 and 20% in the second quarter of 2023.
−Removed: In the second quarter of 2024, total refinance origination dollars increased 24% from the fourth quarter of 2023 and increased 1% from the second quarter of 2023.
−Removed: Industry-wide mortgage origination dollars in the second quarter of 2024 increased 8% from the fourth quarter of 2023 and decreased 7% from second quarter of 2023.
+Added: According to Mortgage Bankers Association (“MBA”) data, total refinance origination dollars increased to 25% of total mortgage origination dollars in the third quarter of 2024 compared to 15% in the fourth quarter of 2023 and 14% in the third quarter of 2023.
+Added: In the third quarter of 2024, total refinance origination dollars increased 135% from the fourth quarter of 2023 and increased 118% from the third quarter of 2023.
+Added: Industry-wide mortgage origination dollars in the third quarter of 2024 increased 35% from the fourth quarter of 2023 and increased 21% from third quarter of 2023.
According to MBA projections, the mix of mortgage origination dollars is expected to continue to be weighted towards purchase mortgages with the refinance share representing approximately 28% for 2024 compared to 15% in 2023.
5 unchanged sentences
Conversely, a weaker real estate market will typically lead to an increase in lender demand, as there are fewer consumers in the marketplace seeking mortgages.
−Removed: According to Fannie Mae data, existing home sales increased approximately 5% in the second quarter of 2024 compared to the fourth quarter of 2023, and decreased approximately 3% compared to the second quarter of 2023.
−Removed: Fannie Mae predicts an overall increase in existing-home sales of approximately 2% in 2024 compared to 2023.
+Added: According to Fannie Mae data, existing home sales increased approximately 1% in the third quarter of 2024 compared to the fourth quarter of 2023, and decreased approximately 2% compared to the third quarter of 2023.
+Added: Fannie Mae predicts an overall decrease in existing-home sales of approximately 1% in 2024 compared to 2023.
We consider certain metrics related to LendingTree Spring TM ("Spring") set forth below to help us evaluate our business and growth trends and assess operational efficiencies.
1 unchanged sentence
The calculation of the metrics discussed below may differ from other similarly titled metrics used by other companies, securities analysts or investors.
−Removed: We added 0.7 million net new users in the second quarter of 2024, bringing cumulative active users to 29.5 million as of June 30, 2024.
+Added: We added 1.2 million net new users in the third quarter of 2024, bringing cumulative active users to 30.7 million as of September 30, 2024.
We calculate the number of Spring users at a period end as the number of users that had an active account at any point during the quarter that includes the period end date.
Users that deactivated their accounts prior to the most recent quarter are no longer considered in the user base at the end of the most recent quarter.
−Removed: We attribute approximately $6.5 million of revenue, or 3% of total revenue, in the second quarter of 2024 to registered Spring users who initiated their transaction from the Spring platform.
−Removed: During the second quarter of 2024, approximately 0.3 million Spring users initiated a transaction from the Spring platform that contributed to revenue.
+Added: We attribute approximately $5.8 million of revenue, or 2% of total revenue, in the third quarter of 2024 to registered Spring users who initiated their transaction from the Spring platform.
+Added: During the third quarter of 2024, approximately 0.3 million Spring users initiated a transaction from the Spring platform that contributed to revenue.
Cost Reductions and Simplification of Business
−Removed: On March 24, 2023, we committed to a workforce reduction plan (the “Reduction Plan”), to reduce operating costs, which included the elimination of approximately 13% of the Company’s workforce.
+Added: On March 24, 2023, we committed to a workforce reduction plan (the “Reduction Plan”), to reduce operating costs, which included the elimination of approximately 13% of our workforce.
As a result of the Reduction Plan, we incurred approximately $5.3 million in severance charges in connection with the workforce reduction, $4.3 million of which was incurred in the first quarter of 2023 and $1.0 million was incurred in the second quarter of 2023.
2 unchanged sentences
Separately, in 2023, we made the decision to close our Ovation credit services business, an asset group within our Consumer segment, by mid- 2023.
−Removed: As a result, the Company recorded an asset impairment charge of $4.2 million in the first quarter of 2023 related to the write-off of certain long-term assets.
+Added: As a result, we recorded an asset impairment charge of $4.2 million in the first quarter of 2023 related to the write-off of certain long-term assets.
Additionally, we incurred $2.1 million in severance charges in the second quarter of 2023 in connection with cash expenditures for employee separation costs.
1 unchanged sentence
The business grew for a number of years before running into challenges in the wake of COVID-19, and more recently the industry has faced increased regulatory pressure.
−Removed: The business is capital-intensive, requires elevated overhead, and future prospects were becoming uncertain.
+Added: The business was capital-intensive, required elevated overhead, and future prospects were becoming uncertain.
The Ovation business accounted for approximately 3% of total revenue and 3% of total costs and expenses, with an immaterial impact to net income on the consolidated statement of operations and comprehensive income (loss) for the year ended December 31, 2022.
−Removed: Recent Developments
−Removed: In July, we repurchased approximately $7.6 million in principal amount of our 0.50% Convertible Senior Notes due July 15, 2025 (the "2025 Notes"), through individual privately-negotiated transactions with certain holders of such notes, for approximately $7.2 million in cash.
−Removed: Results of Operations for the Three and Six Months ended June 30, 2024 and 2023
+Added: Our revenue and earnings may fluctuate from time to time as a result of changes to federal, state, and industry-based laws and regulations, or changes to standards concerning the enforcement thereof.
+Added: On January 26, 2024, the U.S.
+Added: Federal Communications Commission (the “FCC”) published regulations which, among other things, amend the consent requirements of the Telephone Consumer Protection Act of 1991 to close what the FCC refers to as the “lead generator loophole” by requiring “one-to-one consent” for outbound telemarketing calls or texts made using an automatic telephone dialing system or pre-recorded or artificial voice messages to wireless or residential numbers.
+Added: The new “one-to-one consent” rule is scheduled to take effect on January 27, 2025.
+Added: Although it remains unclear how these changes may ultimately be interpreted by courts or further revised by regulators, we anticipate that the required changes could have an adverse impact on the market for financial product and insurance quote requests and will require us and our third-party sources to modify our marketing practices and policies.
+Added: While we have been proactively working to enhance our due diligence, contractual requirements, and oversight of lead generators, and will continue to analyze our marketing practices and policies and update as appropriate to mitigate the impact on our business and to ensure continuing compliance with the new rules, it is not possible to ensure that all lead generators and employees will comply with our policies and procedures at all times, which may result in potential litigation and regulatory exposure.
+Added: Results of Operations for the Three and Nine Months ended September 30, 2024 and 2023
Our discussion within Revenue provides the details of consolidated revenue by segment and significant products.
4 unchanged sentences
In Segment Profit, we provide a discussion of the business within each segment, addressing both Company and market impacts on the profitability of each segment in addition to a discussion of segment margin.
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
Change 2024 2023 $
13 unchanged sentences
Amortization of intangibles 1,466 1,981 (515) (26) % 4,422 6,012 (1,590) (26) %
+Added: Goodwill impairment — 38,600 (38,600) (100) % — 38,600 (38,600) (100) %
Restructuring and severance 273 1,955 (1,682) (86) % 498 9,967 (9,469) (95) %
4 unchanged sentences
Interest (expense) income, net (10,060) (7,097) (2,963) (42) % (17,899) 10,992 (28,891) (263) %
−Removed: Other income 1,052 439 613 140 % 2,086 2,273 (187) (8) %
−Removed: Income before income taxes 9,438 112 9,326 8,327 % 11,013 13,964 (2,951) (21) %
−Removed: Income tax expense (1,686) (227) 1,459 643 % (2,245) (622) 1,623 261 %
−Removed: Net income (loss) and comprehensive income (loss) $ 7,752 $ (115) $ 7,867 6,841 % $ 8,768 $ 13,342 $ (4,574) (34) %
−Removed: Revenue increased in the second quarter of 2024 compared to the second quarter of 2023 due to increases in our Insurance segment partially offset by decreases in our Home and Consumer segments.
−Removed: Revenue decreased in the first six months of 2024 compared to the first six months of 2023 due to decreases in our Home and Consumer segments, partially offset by increases in our Insurance segment.
+Added: Other expense (57,391) (110,910) 53,519 48 % (55,305) (108,637) 53,332 49 %
+Added: Loss before income taxes (57,531) (151,999) 94,468 62 % (46,518) (138,035) 91,517 66 %
+Added: Income tax (expense) benefit (447) 3,534 3,981 113 % (2,692) 2,912 5,604 192 %
+Added: Net loss and comprehensive loss $ (57,978) $ (148,465) $ 90,487 61 % $ (49,210) $ (135,123) $ 85,913 64 %
+Added: Revenue increased in the third quarter and first nine months of 2024 compared to the third quarter and first nine months of 2023 due to increases in our Insurance segment partially offset by decreases in our Home and Consumer segments.
Our Consumer segment includes the following products:
2 unchanged sentences
Many of our Consumer segment products are not individually significant to revenue.
−Removed: Revenue from our Consumer segment decreased $26.6 million, or 32%, in the second quarter of 2024 from the second quarter of 2023 and decreased $54.8 million, or 34%, in the first six months of 2024 from the first six months of 2023 primarily due to decreases in our credit cards and other credit products.
−Removed: Revenue from our personal loans product decreased $1.2 million, or 4%, to $26.9 million in the second quarter of 2024 from $28.1 million in the second quarter of 2023.
−Removed: The decrease in revenue was due to a 19% decrease in revenue earned per consumer, representing $5.4 million of the decrease, partially offset by an 18% increase in volume, representing $4.2 million of an increase.
−Removed: Revenue from our personal loans product decreased $4.7 million, or 9%, to $47.1 million in the first six months of 2024 from $51.7 million in the first six months of 2023.
−Removed: The decrease in revenue was due to a 16% decrease in revenue earned per consumer, representing $8.2 million of the decrease, partially offset by an 8% increase in volume, representing $3.5 million of an increase.
+Added: Revenue from our Consumer segment decreased $7.8 million, or 12%, in the third quarter of 2024 from the third quarter of 2023 primarily due to a decrease in credit cards, partially offset by increases in business loans and personal loans.
+Added: Revenue from our Consumer segment decreased $62.6 million, or 27%, in the first nine months of 2024 from the first nine months of 2023 primarily due to decreases in each of our consumer products, primarily our credit cards and other credit products.
+Added: Revenue from our personal loans product increased $1.3 million, or 5%, to $27.8 million in the third quarter of 2024 from $26.5 million in the third quarter of 2023.
+Added: The increase in revenue was due to a 31% increase in volume, representing $6.5 million , partially offset by a 20% decrease in revenue earned per consumer, representing $5.2 million.
+Added: Revenue from our personal loans product decreased $3.4 million, or 4%, to $74.9 million in the first nine months of 2024 from $78.3 million in the first nine months of 2023.
+Added: The decrease in revenue was due to an 18% decrease in revenue earned per consumer, representing $14.0 million of the decrease, partially offset by a 16% increase in volume, representing $10.6 million of an increase.
We measure volume for our personal loans product as the number of unique consumers completing request forms.
1 unchanged sentence
however, certain other Consumer products experienced notable changes.
−Removed: Revenue from our credit cards product decreased $15.6 million, or 74%, in the second quarter of 2024 compared to the second quarter of 2023 and decreased $26.1 million, or 66%, in the first six months of 2024 compared to the first six months of 2023 primarily due to a decrease in volume.
+Added: Revenue from our credit cards product decreased $8.5 million, or 58%, in the third quarter of 2024 compared to the third quarter of 2023 and decreased $34.6 million, or 64%, in the first nine months of 2024 compared to the first nine months of 2023 due to a decrease in volume and revenue earned per click.
We measure volume for our credit cards product as the number of consumers clicking through to a card issuer.
−Removed: Revenue from our other credit products decreased $4.6 million, or 44%, in the second quarter of 2024 compared to the second quarter of 2023 and decreased $12.0 million, 55%, in the first six months of 2024 compared to the first six months of 2023 due to the closure of our Ovation credit services business at the end of the second quarter of 2023.
+Added: Revenue from our small business loans product increased $3.7 million, or 32%, in the third quarter of 2024 compared to the third quarter of 2023 primarily due to an increase in revenue earned per consumer.
+Added: Revenue from our other credit products decreased $12.4 million, or 46%, in the first nine months of 2024 compared to the first nine months of 2023 due to the closure of our Ovation credit services business at the end of the second quarter of 2023.
+Added: Revenue from our deposits product decreased $6.2 million or 45%, in the first nine months of 2024 compared to the first nine months of 2023 due to a decrease in volume and revenue earned per consumer.
Our Home se gment includes the following products:
purchase mortgage, refinance mortgage, and home equity loans and lines of credit.
−Removed: Revenue from our Home segment decreased $9.4 million, or 23%, in the second quarter of 2024 from the second quarter of 2023, and decreased $22.6 million, or 27%, in the first six months of 2024 from the first six months of 2023 due to decreases in revenue from each of our Home products.
−Removed: Revenue from our mortgage products decreased $6.1 million, or 37%, to $10.2 million in the second quarter of 2024 from $16.2 million in the second quarter of 2023.
+Added: Revenue from our Home segment decreased $1.1 million, or 3%, in the third quarter of 2024 from the third quarter of 2023 primarily due to a decrease in mortgage products partially offset by an increase in our home equity loans product, and decreased $23.8 million, or 20%, in the first nine months of 2024 from the first nine months of 2023 due to decreases in revenue from each of our Home products.
+Added: Revenue from our mortgage products decreased $2.1 million, or 16%, to $11.2 million in the third quarter of 2024 from $13.3 million in the third quarter of 2023.
The decrease in revenue was due to a 12% decrease in volume, representing $1.6 million of the decrease, and a 4% decrease in revenue earned per consumer, representing $0.5 million of the decrease.
−Removed: Revenue from our mortgage products decreased $16.4 million, or 45%, to $19.8 million in the first six months of 2024 from $36.2 million in the first six months of 2023.
+Added: Revenue from our mortgage products decreased $18.5 million, or 37%, to $31.1 million in the first nine months of 2024 from $49.5 million in the first nine months of 2023.
The decrease in revenue was due to a 30% decrease in volume, representing $13.4 million of the decrease, and a 10% decrease in revenue earned per consumer, representing $5.1 million of the decrease.
We measure volume for our mortgage products as the number of consumers completing request forms.
−Removed: Revenue from our purchase mortgage product decreased $3.6 million in the second quarter of 2024 compared to the second quarter of 2023, and decreased $9.4 million in the first six months of 2024 compared to the first six months of 2023 primarily due to a decrease in the number of consumers completing request forms and a decrease in revenue earned per consumer.
−Removed: Revenue from our refinance mortgage product decreased $2.5 million in the second quarter of 2024 compared to the second quarter of 2023 and decreased $6.9 million in the first six months of 2024 compared to the first six months of 2023 due to a decrease in the number of consumers completing request forms and a decrease in revenue earned per consumer, as interest rates have risen.
−Removed: Revenue from our home equity loans product decreased $3.3 million, or 13%, to $22.0 million in the second quarter of 2024 from $25.3 million in the second quarter of 2023.
−Removed: The decrease in revenue was due to a 17% decrease in revenue earned per consumer, representing $4.3 million of the decrease, partially offset by a 5% increase in volume, representing a $1.0 million increase.
−Removed: Revenue from our home equity loans product decreased $6.2 million, or 13%, to $42.8 million in the first six months of 2024 from $49.0 million in the first six months of 2023.
+Added: Revenue from our purchase mortgage product decreased $10.8 million in the first nine months of 2024 compared to the first nine months of 2023 primarily due to a decrease in the number of consumers completing request forms and a decrease in revenue earned per consumer.
+Added: Revenue from our refinance mortgage product decreased $7.7 million in the first nine months of 2024 compared to the first nine months of 2023 due to a decrease in the number of consumers completing request forms and a decrease in revenue earned per consumer, as interest rates have risen.
+Added: Revenue from our home equity loans product decreased $5.3 million, or 8%, to $63.8 million in the first nine months of 2024 from $69.1 million in the first nine months of 2023.
The decrease in revenue was due to a 19% decrease in revenue earned per consumer, representing $13.3 million of the decrease, partially offset by a 14% increase in volume, representing a $8.0 million increase.
We measure volume for our home equity loans and lines of credit products as the number of consumers completing request forms.
−Removed: Revenue from our Insurance segment increased $63.7 million, or 109%, to $122.1 million in the second quarter of 2024 from $58.4 million in the second quarter of 2023.
−Removed: The increase in revenue was due to a 69% increase in revenue earned per consumer, representing $40.5 million of the increase, and a 23% increase in volume, representing $23.2 million of the increase.
−Removed: Revenue from our Insurance segment increased $72.5 million, or 53%, to $207.9 million in the first six months of 2024 from $135.5 million in the first six months of 2023.
+Added: Revenue from our Insurance segment increased $114.5 million, or 210%, to $169.1 million in the third quarter of 2024 from $54.5 million in the third quarter of 2023.
The increase in revenue was due to a 107% increase in revenue earned per consumer, representing $58.1 million of the increase, and a 50% increase in volume, representing $56.4 million of the increase.
+Added: Revenue from our Insurance segment increased $187.0 million, or 98%, to $377.0 million in the first nine months of 2024 from $190.0 million in the first nine months of 2023.
+Added: The increase in revenue was due to a 54% increase in revenue earned per consumer, representing $102.3 million of the increase, and a 29% increase in volume, representing $84.7 million of the
We measure volume for our insurance product as the number of consumer request forms and in certain cases re-engagement with a consumer, the number of such subsequent consumer engagements through our platform.
1 unchanged sentence
Cost of revenue consists primarily of costs associated with compensation and other employee-related costs (including stock-based compensation) relating to internally-operated customer call centers, third-party customer call center fees, credit scoring fees, credit card fees, website network hosting, and server fees.
−Removed: Cost of revenue remained relatively consistent in the second quarter of 2024 from the second quarter of 2023.
−Removed: Cost of revenue decreased $6.1 million in the first six months of 2024 from the first six months of 2023 primarily due to a decrease in
−Removed: compensation and benefits of $4.8 million and a decrease in customer service fees of $0.5 million.
−Removed: The decreases in the first six months are primarily due to the Reduction Plan at the end of the first quarter of 2023, including shutting down the LendingTree customer call center, and the closure of the credit repair business at the end of the second quarter of 2023.
−Removed: Cost of revenue as a percentage of revenue decreased to 4% in the second quarter of 2024 compared to 5% in the second quarter of 2023, and decreased to 4% in the first six months of 2024 compared to 6% in the first six months of 2023.
+Added: Cost of revenue increased $1.8 million in the third quarter of 2024 from the third quarter of 2023 primarily due to increases in direct costs associated with credit scoring and credit card fees, and compensation and benefits.
+Added: Cost of revenue decreased $4.3 million in the first nine months of 2024 from the first nine months of 2023 primarily due to a decrease in compensation and benefits of $3.9 million.
+Added: The decreases in the first nine months are primarily due to the Reduction Plan at the end of the first quarter of 2023, including shutting down the LendingTree customer call center, and the closure of the credit repair business at the end of the second quarter of 2023.
+Added: Cost of revenue as a percentage of revenue decreased to 4% in the third quarter of 2024 compared to 5% in the third quarter of 2023, and decreased to 4% in the first nine months of 2024 compared to 6% in the first nine months of 2023.
Selling and marketing expense
2 unchanged sentences
Advertising production costs are expensed in the period the related ad is first run.
−Removed: Selling and marketing expense increased in the second quarter of 2024 compared to the second quarter 2023 by $32.3 million, and increased $3.4 million in the first six months of 2024 compared to the first six months of 2023 primarily due to the changes in advertising and promotional expense discussed below.
−Removed: Additionally, compensation and benefits decreased $1.0 million in the second quarter of 2024 compared to the second quarter of 2023 and decreased $3.8 million in the first six months of 2024 compared to the first six months of 2023.
+Added: Selling and marketing expense increased in the third quarter of 2024 compared to the third quarter 2023 by $96.3 million, and increased $99.7 million in the first nine months of 2024 compared to the first nine months of 2023 primarily due to the changes in advertising and promotional expense discussed below.
+Added: Additionally, compensation and benefits decreased $3.7 million in the first nine months of 2024 compared to the first nine months of 2023.
Advertising and promotional expense is the largest component of selling and marketing expense, and is comprised of the following:
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
Change 2024 2023 $
10 unchanged sentences
This relationship exists for our Home, Consumer, and Insurance segments.
−Removed: We adjusted our advertising expenditures in the second quarter and first six months of 2024 compared to the second quarter and first six months of 2023 in response to changes in Network Partner demand on our marketplace.
+Added: We adjusted our advertising expenditures in the third quarter and first nine months of 2024 compared to the third quarter and first nine months of 2023 in response to changes in Network Partner demand on our marketplace.
We will continue to adjust selling and marketing expenditures dynamically in response to anticipated revenue opportunities.
1 unchanged sentence
General and administrative expense consists primarily of compensation and other employee-related costs (including stock-based compensation) for personnel engaged in finance, legal, tax, corporate information technology, human resources and executive management functions, as well as facilities and infrastructure costs and fees for professional services.
−Removed: General and administrative expense decreased in the second quarter of 2024 from the second quarter of 2023 primarily due to a decrease in compensation and benefits of $1.7 million and decreases in facilities and fees and other charges of $0.5 million, and $0.9 million, respectively.
−Removed: General and administrative expense decreased in the first six months of 2024 from the first six months of 2023 primarily due to a decrease in compensation and benefits of $5.4 million, a decrease in fees and other charges of $2.0 million and a decrease in facilities expenses of $1.2 million.
−Removed: Additionally, we incurred a $4.2 million loss on the impairment of assets for our Ovation business in the first six months of 2023.
−Removed: General and administrative expense as a percentage of revenue decreased to 13% in the second quarter of 2024 compared to 16% in the second quarter of 2023, and decreased to 14% in the first six months of 2024 compared to 17% in the first six months of 2023.
+Added: General and administrative expense remained relatively consistent in the third quarter of 2024 from the third quarter of 2023.
+Added: General and administrative expense decreased in the first nine months of 2024 from the first nine months of 2023 primarily due to a decrease in compensation and benefits of $5.5 million, a decrease in fees and other charges of $1.5 million and a decrease in facilities expenses of $1.5 million.
+Added: Additionally, we incurred a $4.2 million loss on the impairment of assets for our Ovation business in the first nine months of 2023.
+Added: General and administrative expense as a percentage of revenue decreased to 10% in the third quarter of 2024 compared to 17% in the third quarter of 2023, and decreased to 12% in the first nine months of 2024 compared to 17% in the first nine months of 2023.
Product development
Product development expense consists primarily of compensation and other employee-related costs (including stock-based compensation) and third-party labor costs that are not capitalized, for employees and consultants engaged in the design, development, testing and enhancement of technology.
−Removed: Product development expense remained consistent in the second quarter of 2024 compared to the second quarter of 2023.
−Removed: Product development expense decreased in the first six months of 2024 compared to the first six months of 2023 primarily due to the Reduction Plan at the end of the first quarter of 2023.
+Added: Product development expense remained consistent in the third quarter of 2024 compared to the third quarter of 2023.
+Added: Product development expense decreased in the first nine months of 2024 compared to the first nine months of 2023 primarily due to the Reduction Plan at the end of the first quarter of 2023.
We continued to invest in internal development of new and enhanced features, functionality and business opportunities that we believe will enable us to better and more fully serve consumers and Network Partners.
Amortization of intangibles
−Removed: The decrease in amortization of intangibles in the second quarter and first six months of 2024 compared to the second quarter and first six months of 2023 was primarily due to certain intangible assets associated with our recent business acquisitions becoming fully amortized.
+Added: The decrease in amortization of intangibles in the third quarter and first nine months of 2024 compared to the third quarter and first nine months of 2023 was primarily due to certain intangible assets associated with our recent business acquisitions becoming fully amortized.
+Added: Goodwill impairment
+Added: In the third quarter of 2023, we incurred a goodwill impairment charge of $38.6 million in our Insurance reporting unit.
+Added: See Note 6 - Goodwill and Intangible Assets, in Part I.
+Added: Item 1 Financial Statements, for additional information.
Restructuring and severance
−Removed: On March 24, 2023, we committed to the Reduction Plan to reduce operating costs, which included the elimination of approximately 13% of the Company’s workforce.
+Added: During September 2023, we completed workforce reductions of 14 employees.
+Added: We incurred approximately $0.9 million in severance charges in connection with the workforce reductions, consisting of cash expenditures for employee separation costs of approximately $0.7 million in the third quarter of 2023 and non-cash charges for the accelerated vesting of certain equity awards of approximately $0.2 million through the fourth quarter of 2023.
+Added: The cash payments were completed by the third quarter of 2024.
+Added: On March 24, 2023, we committed to the Reduction Plan to reduce operating costs, which included the elimination of approximately 13% of our workforce.
As a result of the Reduction Plan, we incurred approximately $5.3 million in severance charges in connection with the workforce reduction, consisting of cash expenditures for employee separation costs of approximately $4.3 million and non-cash charges for the accelerated vesting of certain equity awards of approximately $1.0 million.
3 unchanged sentences
Interest (expense) income
−Removed: In March 2024, we drew $125.0 million on a first lien term loan facility and incurred $4.0 million and $4.2 million of interest expense in the second quarter and first six months of 2024.
+Added: In March 2024, we drew $125.0 million on a first lien term loan facility and incurred $3.8 million and $8.0 million of interest expense in the third quarter of 2024 and first nine months of 2024, respectively.
+Added: In the third quarter of 2024, we repurchased approximately $7.6 million in principal amount of our 0.50% Convertible Senior Notes due July 15, 2025 (the "2025 Notes") for $7.2 million.
+Added: As a result of the repurchase, we recognized a gain on the extinguishment of $0.5 million and an immaterial loss on the write-off of unamortized debt issuance costs, both of which are included in interest (expense) income, net in the consolidated statements of operations and comprehensive income.
In the second quarter of 2024, we repurchased approximately $161.3 million in principal amount of our 2025 Notes for $151.7 million plus accrued and unpaid interest of approximately $0.3 million.
2 unchanged sentences
As a result of the repurchase, we recognized a gain on the extinguishment of $34.3 million, a loss on the write-off of unamortized debt issuance costs of $2.4 million, and incurred debt repayment costs of $1.0 million, all of which are included in interest (expense) income, net in the consolidated statements of operations and comprehensive income.
−Removed: See Note 12—Debt for additional information.
−Removed: Other income primarily consists of dividend income.
+Added: See Note 12—Debt, in Part I.
+Added: Item 1 Financial Statements, for additional information.
+Added: Other expense
+Added: In the third quarter of 2024, we incurred impairment charges of $58.4 million related to two investments in equity securities.
+Added: In the third quarter of 2023, we incurred an impairment charge of $113.1 million related to an investment in equity securities.
+Added: See Note 7 - Equity Investment, in Part I.
+Added: Item 1 Financial Statements, for additional information.
Income tax expense
−Removed: For the second quarter and first six months of 2024 and 2023, the effective tax rate varied from the federal statutory rate of 21% primarily due to the change in the valuation allowance, net of the current period change in tax effected net indefinite-lived intangibles.
+Added: For the third quarter and first nine months of 2024 and 2023, the effective tax rate varied from the federal statutory rate of 21% primarily due to the change in the valuation allowance, net of the current period change in tax effected net indefinite-lived intangibles.
Segment Profit
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
Change 2024 2023 $
1 unchanged sentence
Revenue $ 32,248 $ 33,390 $ (1,142) (3) % $ 94,857 $ 118,628 $ (23,771) (20) %
−Removed: Segment cost of revenue and marketing expense (1)
+Added: Segment marketing expense (1)
22,993 22,095 898 4 % $ 66,703 $ 78,878 $ (12,175) (15) %
2 unchanged sentences
Revenue 59,474 67,253 (7,779) (12) % 166,826 229,439 (62,613) (27) %
−Removed: Segment cost of revenue and marketing expense (1)
+Added: Segment marketing expense (1)
31,491 32,826 (1,335) (4) % 84,491 119,466 (34,975) (29) %
2 unchanged sentences
Revenue 169,065 54,536 114,529 210 % 377,008 190,016 186,992 98 %
−Removed: Segment cost of revenue and marketing expense (1)
+Added: Segment marketing expense (1)
127,622 31,177 96,445 309 % 265,751 111,754 153,997 138 %
2 unchanged sentences
Revenue 2 9 (7) (78) % 6 66 (60) (91) %
−Removed: Segment cost of revenue and marketing expense (1)
+Added: Segment marketing expense (1)
45 21 24 114 % 104 516 (412) (80) %
1 unchanged sentence
Revenue 260,789 155,188 105,601 68 % 638,697 538,149 100,548 19 %
−Removed: Segment cost of revenue and marketing expense (1)
+Added: Segment marketing expense (1)
182,151 86,119 96,032 112 % 417,049 310,614 106,435 34 %
1 unchanged sentence
Segment margin 30% 45% 35% 42%
−Removed: (1) Segment cost of revenue and marketing expense represents the potion of selling and marketing expense attributable to variable costs paid for advertising, direct marketing and related expenses, that are directly attributable to the segments' products.
+Added: (1) Segment marketing expense represents the potion of selling and marketing expense attributable to variable costs paid for advertising, direct marketing and related expenses, that are directly attributable to the segments' products.
This measure excludes overhead, fixed costs and personnel-related costs.
2 unchanged sentences
See Note 15—Segment Information in the notes to the consolidated financial statements for additional information on segments and a reconciliation of segment profit to pre-tax income.
−Removed: Home segment revenue decreased 23% to $32.2 million in the second quarter of 2024 from the second quarter of 2023 and segment profit decreased 30% to $9.3 million in the second quarter of 2024 from the second quarter of 2023.
−Removed: Segment margin declined to 29% in the second quarter of 2024 compared to 32% in the second quarter of 2023, primarily due to a decline in revenue earned per consumer, due to a decline close rates at our lender partners.
−Removed: Home equity revenue of $22.0 million in the second quarter of 2024 decreased $3.3 million from $25.3 million in the second quarter of 2023.
−Removed: Volume of home equity consumers completing request forms increased 5% in the second quarter of 2024 compared to the second quarter of 2023, however, the 17% decline in revenue earned per consumer outpaced this volume growth.
−Removed: Within Home, our core mortgage business generated revenue of $10.2 million in the second quarter of 2024, down 37% from the second quarter of 2023.
+Added: Home segment revenue decreased 3% to $32.2 million in the third quarter of 2024 from the third quarter of 2023 and segment profit decreased 18% to $9.3 million in the third quarter of 2024 from the third quarter of 2023.
+Added: Segment margin declined to 29% in the third quarter of 2024 compared to 34% in the third quarter of 2023, primarily due to a decline in revenue earned per consumer, due to a decline in close rates at our lender partners.
+Added: Home equity revenue of $21.0 million in the third quarter of 2024 increased $0.9 million from $20.1 million in the third quarter of 2023.
+Added: Volume of home equity consumers completing request forms increased 25% in the third quarter of 2024
+Added: compared to the third quarter of 2023, however, a 17% decline in revenue earned per consumer partially offset this volume growth.
+Added: Within Home, our core mortgage business generated revenue of $11.2 million in the third quarter of 2024, down 16% from the third quarter of 2023.
Our refinance product within our mortgage business matches consumers in the market looking to refinance their existing mortgages with our network lenders.
1 unchanged sentence
Our mortgage business is directly impacted by the mortgage market in which we participate.
−Removed: We believe financial market expectations for decreases in interest rates later this year would likely benefit the mortgage and home equity lending environment and our Home segment.
−Removed: Our Consumer segment revenue decreased 32% to $55.9 million in the second quarter of 2024 from the second quarter of 2023, and segment profit decreased 34% to $26.9 million in the second quarter of 2024 from the second quarter of 2023 due to the decline in revenue.
−Removed: Segment margin was consistent in the second quarter of 2024 compared to the second quarter of 2023.
−Removed: Personal loans revenue of $26.9 million in the second quarter of 2024 decreased 4% from the second quarter of 2023 as lending standards remain restrictive at our lender partners.
−Removed: However, personal loans revenue increased 34% in the second quarter of 2024 from the first quarter of 2024 as our targeted marketing investment in personal loans increased volume amid stable credit standards.
+Added: Our mortgage business continues to see headwinds from a lack of in-the-money refinance borrowers given the current higher level of mortgage rates, and subdued home sales have pressured the volume of consumers searching for purchase loans.
+Added: We believe financial market expectations for continued decreases in interest rates may benefit the mortgage and home equity lending environment and our Home segment.
+Added: Our Consumer segment revenue decreased 12% to $59.5 million in the third quarter of 2024 from the third quarter of 2023, and segment profit decreased 19% to $28.0 million in the third quarter of 2024 from the third quarter of 2023 due to the decline in revenue.
+Added: Segment margin was 47% in the third quarter of 2024 compared to 51% in the third quarter of 2023 primarily due to a decline in revenue earned per consumer on certain products as well as a change in mix shift in the product revenue.
+Added: Personal loans revenue of $27.8 million in the third quarter of 2024 increased 5% from the third quarter of 2023 as lending standards remain restrictive at our lender partners.
+Added: If financial market expectations for decreases in short-term interest rates remain as projected, we believe this would likely benefit our personal loans product in future quarters.
+Added: Small business revenue increased 32% in the third quarter of 2024 from the third quarter of 2023, as the lending appetite has remained stable from our partners.
+Added: Additionally, the revenue growth has allowed us to invest more into marketing spend to capture high quality business owners searching for loans.
See the section titled "Revenue" above for additional discussion of declines in product revenues within the Consumer segment.
−Removed: Insurance revenue increased 109% to $122.1 million in the second quarter of 2024 from the second quarter of 2023 and segment profit increased 47% to $36.4 million in the second quarter of 2024 from the second quarter of 2023.
−Removed: Carrier demand for new auto insurance customers has been strong, with volume increasing 23% in the second quarter of 2024 compared to the second quarter of 2023, as two years of compounded premium rate increases combined with declines in the price of used vehicles and replacement parts has created a favorable underwriting environment.
−Removed: Segment margin declined to 30% in the second quarter of 2024 from 42% in the second quarter of 2023.
+Added: Insurance revenue increased 210% to $169.1 million in the third quarter of 2024 from the third quarter of 2023 and segment profit increased 77% to $41.4 million in the third quarter of 2024 from the third quarter of 2023.
+Added: Carrier demand for new auto insurance customers has been strong, with volume increasing 50% in the third quarter of 2024 compared to the third quarter of 2023, as two years of compounded premium rate increases combined with declines in the price of used vehicles and replacement parts has created a favorable underwriting environment.
+Added: Segment margin declined to 25% in the third quarter of 2024 from 43% in the third quarter of 2023.
In 2023, we were able to exit from our highest cost marketing channels and continue to meet the decreased level of demand.
−Removed: In the second quarter of 2024, we re-entered those marketing channels to fill the increase in carrier demand, which has resulted in lower segment profit margin.
−Removed: We expect our Insurance segment to have continued sequential revenue growth for the remainder of the year.
+Added: In 2024, we re-entered those marketing channels to fill the increase in carrier demand, which has resulted in lower segment profit margin.
Variable Marketing Expense and Variable Marketing Margin
2 unchanged sentences
Variable marketing margin is a measure of the efficiency of our operating model, measuring revenue after subtracting variable marketing expense.
−Removed: Our operating model is highly sensitive to the amount and
−Removed: efficiency of variable marketing expenditures, and our proprietary systems are able to make rapidly changing decisions concerning the deployment of variable marketing expenditures (primarily but not exclusively online and mobile advertising placement) based on proprietary and sophisticated analytics.
+Added: Our operating model is highly sensitive to the amount and efficiency of variable marketing expenditures, and our proprietary systems are able to make rapidly changing decisions concerning the deployment of variable marketing expenditures (primarily but not exclusively online and mobile advertising placement) based on proprietary and sophisticated analytics.
We believe that investors should have access to the same set of tools that we use in analyzing our results.
6 unchanged sentences
Three Months Ended
−Removed: June 30, Six Months Ended
+Added: September 30, Nine Months Ended
+Added: September 30,
2024 2023 2024 2023
5 unchanged sentences
Three Months Ended
−Removed: June 30, Six Months Ended
+Added: September 30, Nine Months Ended
+Added: September 30,
2024 2023 2024 2023
3 unchanged sentences
Variable marketing expense $ 183,566 $ 87,439 $ 421,134 $ 317,796
−Removed: The following is a reconciliation of net income (loss), the most directly comparable GAAP measure, to variable marketing margin:
+Added: The following is a reconciliation of net loss, the most directly comparable GAAP measure, to variable marketing margin:
Three Months Ended
−Removed: June 30, Six Months Ended
+Added: September 30, Nine Months Ended
+Added: September 30,
2024 2023 2024 2023
(in thousands)
−Removed: Net income (loss) $ 7,752 $ (115) $ 8,768 $ 13,342
+Added: Net loss $ (57,978) $ (148,465) $ (49,210) $ (135,123)
Adjustments to reconcile to variable marketing margin:
6 unchanged sentences
Amortization of intangibles 1,466 1,981 4,422 6,012
+Added: Goodwill impairment — 38,600 — 38,600
Restructuring and severance 273 1,955 498 9,967
1 unchanged sentence
Interest expense (income), net 10,060 7,097 17,899 (10,992)
−Removed: Other (income) expense (1,052) (439) (2,086) (2,273)
−Removed: Income tax expense 1,686 227 2,245 622
+Added: Other expense 57,391 110,910 55,305 108,637
+Added: Income tax expense (benefit) 447 (3,534) 2,692 (2,912)
Variable marketing margin $ 77,223 $ 67,749 $ 217,563 $ 220,353
23 unchanged sentences
At the time of an acquisition, the intangible assets of the acquired company, such as purchase agreements, technology and customer relationships, are valued and amortized over their estimated lives.
−Removed: The following table is a reconciliation of net income (loss), the most directly comparable GAAP measure, to Adjusted EBITDA.
+Added: The following table is a reconciliation of net loss, the most directly comparable GAAP measure, to Adjusted EBITDA.
Three Months Ended
−Removed: June 30, Six Months Ended
+Added: September 30, Nine Months Ended
+Added: September 30,
2024 2023 2024 2023
(in thousands)
−Removed: Net income (loss) $ 7,752 $ (115) $ 8,768 $ 13,342
+Added: Net loss $ (57,978) $ (148,465) $ (49,210) $ (135,123)
Adjustments to reconcile to Adjusted EBITDA:
3 unchanged sentences
Loss on impairments and disposal of assets 6 88 787 5,255
−Removed: Loss on investments — 1,440 — 1,440
+Added: Loss on impairment of equity investments 58,376 113,064 58,376 114,504
+Added: Goodwill impairment — 38,600 — 38,600
Non-cash compensation expense 6,859 8,592 22,085 28,999
1 unchanged sentence
Litigation settlements and contingencies 3,762 (150) 3,791 350
−Removed: Interest (income) expense, net 1,201 6,940 7,839 (18,089)
+Added: Interest expense (income), net 10,060 7,097 17,899 (10,992)
Dividend income (982) (2,154) (3,241) (5,867)
−Removed: Income tax expense 1,686 227 2,245 622
+Added: Income tax expense (benefit) 447 (3,534) 2,692 (2,912)
Adjusted EBITDA $ 26,873 $ 21,834 $ 71,951 $ 63,027
−Removed: Financial Position, Liquidity and Capital Resources
−Removed: As of June 30, 2024, we had $66.8 million of cash and cash equivalents, compared to $112.1 million of cash and cash equivalents as of December 31, 2023.
+Added: Financial Condition, Liquidity and Capital Resources
+Added: As of September 30, 2024, we had $96.8 million of cash and cash equivalents, compared to $112.1 million of cash and cash equivalents as of December 31, 2023.
+Added: In the third quarter of 2024, we repurchased approximately $7.6 million in principal amount of our 2025 Notes for $7.2 million.
+Added: As a result of the repurchase, we recognized a gain on the extinguishment of $0.5 million and an immaterial loss on the write-off of unamortized debt issuance costs, both of which are included in interest (expense) income, net in the consolidated statements of operations and comprehensive income.
In the second quarter of 2024, we repurchased approximately $161.3 million in principal amount of our 2025 Notes for $151.7 million plus accrued and unpaid interest of approximately $0.3 million.
2 unchanged sentences
We will continue to monitor the impact of the current economic conditions, including interest rates and inflation on our liquidity and capital resources.
−Removed: As of June 30, 2024, we have $122.9 million outstanding on the 2025 Notes.
−Removed: We intend to use cash on hand, available borrowings from the 2024 Term Loan, and future cash flows from operations for the repayment of the 2025 Notes.
+Added: As of September 30, 2024, we have $115.3 million outstanding on the 2025 Notes.
+Added: We intend to use cash on hand, available borrowings of $50.0 million from the 2024 Term Loan (as defined below), and future cash flows from operations for the repayment of the 2025 Notes.
+Added: Equity Distribution Agreement
+Added: In July 2024, we entered into an Equity Distribution Agreement in connection with the establishment of an ATM Equity Program (as defined in the 2024 Term Loan (as defined herein) agreement) under which we may sell up to an aggregate of $50.0 million of shares of the our common stock.
+Added: No sales were made under the Equity Distribution Agreement during the three months ended September 30, 2024.
Credit Facilities
3 unchanged sentences
The remaining proceeds of $79.8 million may be used for general corporate purposes and any other purposes not prohibited by the Credit Agreement.
−Removed: As of July 26, 2024, we have outstanding $245.0 under the 2021 Term Loan, a $0.2 million letter of credit under the Revolving Facility and the remaining borrowing capacity under the Revolving Facility is $199.8 million.
−Removed: As of June 30, 2024, we have $20.0 million available for borrowing under the Revolving Facility.
+Added: As of November 1, 2024, we have outstanding $244.4 million under the 2021 Term Loan and the remaining borrowing capacity under the Revolving Facility is $200.0 million.
+Added: As of September 30, 2024, we have $20.0 million available for borrowing under the Revolving Facility.
On March 27, 2024, we entered a first lien term loan facility (the “2024 Term Loan”), consisting of $175.0 million which matures on March 27, 2031.
We drew $125.0 million of the 2024 Term Loan upon closing while the remaining $50.0 million will be available as a delayed draw term loan until March 27, 2025.
−Removed: The proceeds of the 2024 Term Loan will be used for working capital and general corporate purposes, which may include repayment of our 2025 Notes.
+Added: The proceeds of the 2024 Term Loan were used to pay fees and expenses incurred in connection with the closing of the 2024 Term Loan and delayed draw term loan, and will be used for working capital and general corporate purposes, which may include repayment of our 2025 Notes.
The funding had a $3.1 million original issue discount and associated debt issuance costs of $4.3 million.
−Removed: As of July 26, 2024, the Company had $121.9 million borrowings outstanding under the 2024 Term Loan.
−Removed: See Note 12—Debt for additional information.
+Added: We filed an ATM Shelf Registration (as defined in the 2024 Term Loan agreement) with the SEC in the third quarter of 2024.
+Added: In the event of a default in the minimum Consolidated EBITDA (as defined in the 2024 Term Loan agreement) covenant in the 2024 Term Loan, we are required to utilize the ATM Equity Program (as defined in the 2024 Term Loan agreement) to sell common stock and use the proceeds to cure the event of default in the minimum Consolidated EBITDA covenant.
+Added: Additionally, we may use the ATM Equity Program to maintain the $40.0 million minimum cash balance requirement in the 2024 Term Loan.
+Added: As of November 1, 2024, we had $118.8 million borrowings outstanding under the 2024 Term Loan.
+Added: See Note 12—Debt, in Part I.
+Added: Item 1 Financial Statements, for additional information.
Our cash flows are as follows:
−Removed: Six Months Ended
+Added: Nine Months Ended
+Added: September 30,
(in thousands)
6 unchanged sentences
In addition, our uses of cash from operating activities include compensation and other employee-related costs, other general corporate expenditures, litigation settlements and contingencies, and income taxes.
−Removed: Net cash provided by operating activities decreased in the first six months of 2024 from the first six months of 2023 primarily due to unfavorable changes in accounts receivable, partially offset by favorable changes in accounts payable, accrued expenses and other current liabilities.
+Added: Net cash provided by operating activities remained relatively consistent in the first nine months of 2024 from the first nine months of 2023 primarily due to unfavorable changes in accounts receivable, partially offset by favorable changes in accounts payable, accrued expenses and other current liabilities.
Cash Flows from Investing Activities
−Removed: Net cash used in investing activities in the first six months of 2024 and 2023 consisted of capital expenditures primarily related to internally developed software.
+Added: Net cash used in investing activities in the first nine months of 2024 and 2023 consisted of capital expenditures primarily related to internally developed software.
Cash Flows from Financing Activities
−Removed: Net cash used in financing activities in the first six months of 2024 consisted primarily of the repurchase of the 2025 Notes for $151.7 million, term loan repayments of $4.4 million and $2.3 million in withholding taxes paid upon surrender of shares to
−Removed: satisfy obligations on equity awards, net of proceeds from the exercise of stock options offset by $117.8 million net proceeds from the 2024 Term Loan.
−Removed: Net cash used in financing activities in the first six months of 2023 consisted primarily of the repurchase of the 2025 Notes for $156.3 million.
−Removed: New Accounting Pronouncements
−Removed: For information regarding new accounting pronouncements, see Note 2 — Significant Accounting Policies, in Part I, Item 1 Financial Statements .
+Added: Net cash used in financing activities in the first nine months of 2024 consisted primarily of the repurchase of the 2025 Notes for $158.8 million, term loan repayments of $8.8 million and $2.8 million in withholding taxes paid upon surrender of shares to satisfy obligations on equity awards, net of proceeds from the exercise of stock options offset by $117.8 million net proceeds from the 2024 Term Loan.
+Added: Net cash used in financing activities in the first nine months of 2023 consisted primarily of the repurchase of the 2025 Notes for $156.3 million.
+Added: New Accounting Pronouncements and Critical Accounting Estimates
+Added: For information regarding new accounting pronouncements and critical accounting estimates, see Note 2 — Significant Accounting Policies, in Part I, Item 1 Financial Statements .
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.