What changed in this filing

/stocks — the workspaceLOADING

Item 8. Financial Statements and Supplementary Data

2025-03-07 compared with 2024-02-29 · 262 added, 395 removed, 1078 unchanged (38% of the section changed)

14 unchanged sentences

We have audited the accompanying consolidated balance sheets of LendingTree, Inc.

and its subsidiaries (the “Company”) as of December 31, 2023 and 2022, and the related consolidated statements of operations and comprehensive income (loss), of shareholders' equity and of cash flows for each of the three years in the period ended December 31, 2023, including the related notes (collectively referred to as the “consolidated financial statements”).

and its subsidiaries (the "Company") as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive income, of shareholders' equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes (collectively referred to as the "consolidated financial statements").

We also have audited the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

1 unchanged sentence

Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO.

Change in Accounting Principle

As discussed in Note 2 to the consolidated financial statements, the Company changed the manner in which it accounts for convertible debt in 2022.

Basis for Opinions

19 unchanged sentences

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that (i) relate to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Interim Goodwill Impairment Assessment – Home and Insurance Reporting Units

As described in Notes 2 and 7 to the consolidated financial statements, the Company’s consolidated goodwill balance was $381.5 million as of December 31, 2023, and the goodwill associated with the Home and Insurance reporting units was $59.3 million and $156.1 million, respectively.

Goodwill is tested annually for impairment as of October 1, or more frequently upon the occurrence of certain events or substantive changes in circumstances.

Management may elect to assess qualitative factors as a basis for determining whether it is necessary to perform the traditional quantitative impairment testing.

At September 29, 2023, the Company’s market capitalization was below the Company’s book value.

In addition, considering the effects of the challenging interest rate environment, low for-sale home inventories and the rise in home prices in the Home reporting unit and consumer price inflation negatively impacting carrier underwriting in the Insurance reporting unit, management concluded that a triggering event had occurred and an interim quantitative impairment test was performed as of September 30, 2023.

The quantitative impairment test for goodwill involves a comparison of the fair value of a reporting unit with its carrying amount, including goodwill.

Upon completing the quantitative interim goodwill impairment test, management concluded that the carrying value of the Insurance reporting unit exceeded its fair value, which resulted in a goodwill impairment charge of $38.6 million, and that the fair value of the Home reporting unit exceeded its carrying amount, indicating no goodwill impairment.

Management determines the fair value of the Company’s reporting units by using a market approach and a discounted cash flow analysis.

Determining the fair value using a discounted cash flow analysis and market analysis requires the exercise of significant judgments, including judgments about appropriate discount rates, revenue growth rates, marketing spend, direct operating expenses, the amount and timing of expected future cash flows, and market multiples.

The principal considerations for our determination that performing procedures relating to the interim goodwill impairment assessment of the Home and Insurance reporting units is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the Home and Insurance reporting units;

(ii) a high degree of auditor judgment , subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to revenue growth rates, marketing spend, direct operating expenses, the discount rate, and market multiples;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements.

These procedures included testing the effectiveness of controls relating to management’s goodwill impairment assessment, including controls over the valuation of the Home and Insurance reporting units.

These procedures also included, among others (i) testing management’s process for developing the fair value estimate of the Home and Insurance reporting units;

(ii) evaluating the appropriateness of the discounted cash flow analysis and market approach used by management;

(iii) testing the completeness and accuracy of the underlying data used in the discounted cash flow analysis and market approach;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to revenue growth rates, marketing spend, direct operating expenses, the discount rate, and market multiples.

Evaluating management’s assumptions related to revenue growth rates, marketing spend, and direct operating expenses involved considering (i) the current and past performance of the Home and Insurance reporting units and (ii) whether the assumptions were consistent with evidence obtained in other areas of the audit, and for revenue growth rates (iii) the consistency with external market and industry data.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the discounted cash flow analysis and market approach and (ii) the reasonableness of the assumptions related to the discount rate and market multiples.

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Equity Investment Impairment Assessment - Stash Investment

As described in Notes 2 and 8 to the consolidated financial statements, in the third quarter of 2023, management determined there was an impairment indicator related to the Company’s Stash investment and performed a valuation of the investment, which resulted in an impairment charge of $113.1 million.

As described in Notes 2 and 8 to the consolidated financial statements, the Company’s consolidated equity investments balance was $1.7 million as of December 31, 2024 and relates to an equity interest in Stash Financial, Inc.

In the third quarter of 2024, management determined there was an impairment indicator related to the Company’s Stash investment and performed a valuation of the investment, which resulted in an impairment charge of $43.4 million.

The equity investments do not have a readily determinable fair value and, upon acquisition, the Company elected the measurement alternative to value its investments.

The equity investments are carried at cost less impairment, if any, and subsequently measured to fair value upon observable price changes in an orderly transaction for the identical or similar investments.

Additionally, if a qualitative assessment identifies impairment indicators, then the equity investments must be evaluated for impairment and written down to its fair value, if it is determined that the fair value is less than the carrying value.

Management determined the fair value by using a market approach and a discounted cash

flow analysis.

Determining the fair value using a discounted cash flow analysis and market analysis requires the exercise of significant judgments, including judgments about the appropriate discount rate, perpetual growth rates, including short-term revenue and EBITDA, the amount and timing of expected future cash flows, and the revenue exit multiple.

Management determined the fair value by predominantly modeling the Company’s value of the investment based on the new funding terms utilizing an option pricing model.

Determining the fair value using the new funding terms requires the exercise of significant judgments, including judgments about the appropriate volatility, risk-free rate of return, time to expiration, and liquidation preferences.

The principal considerations for our determination that performing procedures relating to the equity investment impairment assessment of the Stash investment is a critical audit matter are (i) the significant judgment by management when developing the fair value estimate of the Stash investment;

(ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating management’s significant assumptions related to short-term revenue and EBITDA growth rates, the discount rate, and the revenue exit multiple;

(ii) a high degree of auditor judgment , subjectivity , and effort in performing procedures and evaluating management’s significant assumptions related to volatility, risk-free rate of return, time to expiration, and liquidation preferences;

and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.

2 unchanged sentences

These procedures also included, among others (i) testing management’s process for developing the fair value estimate of the Stash investment;

(ii) evaluating the appropriateness of the discounted cash flow analysis and market approach used by management;

(iii) testing the completeness and accuracy of the underlying data used in the discounted cash flow analysis and market approach;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to short-term revenue and EBITDA growth rates, the discount rate, and the revenue exit multiple.

Evaluating management’s assumptions related to short-term revenue and EBITDA growth rates involved considering (i) the current and past performance of the Stash investment and (ii) the consistency with market data.

(ii) evaluating the appropriateness of the option pricing model used by management;

(iii) testing the completeness and accuracy of the underlying data, including the new funding terms, used in the option pricing model;

and (iv) evaluating the reasonableness of the significant assumptions used by management related to volatility, risk-free rate of return, time to expiration, and liquidation preferences.

Professionals with specialized skill and knowledge were used to assist in evaluating (i) the appropriateness of the option pricing model and (ii) the reasonableness of the assumptions related to volatility, risk-free rate of return, time to expiration, and liquidation preferences.

/s/ PricewaterhouseCoopers LLP

Charlotte, North Carolina

February 28, 2024

March 6, 2025

We have served as the Company’s auditor since 2012.

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Prepaid and other current assets 34,078 29,472

Assets held for sale (Note 9)

Total current assets 238,462 196,482

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Equity investments (Note 8)

60,076 174,580

Other non-current assets 7,353 6,339

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Accrued expenses and other current liabilities 107,185 70,544

Liabilities held for sale (Note 9)

Total current liabilities 240,476 75,629

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Goodwill impairment — 38,600 —

Change in fair value of contingent consideration — — ( 8,249 )

Restructuring and severance 508 10,118 4,428

1 unchanged sentence

Total costs and expenses 855,592 713,113 1,017,754

Operating (loss) income ( 40,611 ) ( 32,762 ) 8,031

Operating income (loss) 44,627 ( 40,611 ) ( 32,762 )

Other (expense) income, net:

Interest income (expense), net 21,685 ( 26,014 ) ( 46,867 )

Interest (expense) income, net ( 27,849 ) 21,685 ( 26,014 )

Other (expense) income ( 54,162 ) ( 105,993 ) 3,843

(Loss) income before income taxes ( 124,919 ) ( 54,933 ) 84,436

Income tax benefit (expense) 2,515 ( 133,019 ) ( 11,298 )

Net (loss) income from continuing operations ( 122,404 ) ( 187,952 ) 73,138

Loss from discontinued operations, net of tax — — ( 4,023 )

Net (loss) income and comprehensive (loss) income $ ( 122,404 ) $ ( 187,952 ) $ 69,115

Loss before income taxes ( 37,384 ) ( 124,919 ) ( 54,933 )

Income tax (expense) benefit ( 4,320 ) 2,515 ( 133,019 )

Net loss and comprehensive loss $ ( 41,704 ) $ ( 122,404 ) $ ( 187,952 )

Weighted average shares outstanding:

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Diluted 13,269 12,941 12,793

(Loss) income per share from continuing operations:

Basic $ ( 9.46 ) $ ( 14.69 ) $ 5.54

Diluted $ ( 9.46 ) $ ( 14.69 ) $ 5.34

Loss per share from discontinued operations:

Basic $ — $ — $ ( 0.30 )

Diluted $ — $ — $ ( 0.29 )

Net (loss) income per share:

Net loss per share:

Basic $ ( 3.14 ) $ ( 9.46 ) $ ( 14.69 )

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Balance as of December 31, 2021 $ 447,992 16,071 $ 161 $ 1,242,794 $ ( 571,794 ) 2,976 $ ( 223,169 )

Net income and comprehensive income 69,115 — — — 69,115 — —

Net loss and comprehensive loss ( 187,952 ) — — — ( 187,952 ) — —

Non-cash compensation 59,624 — — 59,624 — — —

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Issuance of common stock for stock options, restricted stock awards and restricted stock units, net of withholding taxes ( 3,412 ) 96 1 ( 3,413 ) — — —

Other ( 8 ) — — ( 8 ) — — —

Cumulative effect adjustment due to ASU 2020-06 ( 65,303 ) — — ( 109,750 ) 44,447 — —

Balance as of December 31, 2022 $ 207,940 16,167 $ 162 $ 1,189,255 $ ( 715,299 ) 3,355 $ ( 266,178 )

1 unchanged sentence

Non-cash compensation 39,682 — — 39,682 — — —

Purchase of treasury stock ( 43,009 ) — — — — 379 ( 43,009 )

Issuance of common stock for stock options, restricted stock awards and restricted stock units, net of withholding taxes ( 1,087 ) 230 2 ( 1,089 ) — — —

Cumulative effect adjustment due to ASU 2020-06 ( 65,303 ) — — ( 109,750 ) 44,447 — —

Other 1 — — 1 — — —

Balance as of December 31, 2023 $ 124,132 16,397 $ 164 $ 1,227,849 $ ( 837,703 ) 3,355 $ ( 266,178 )

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Issuance of common stock for stock options, employee stock purchase plan, restricted stock awards and restricted stock units, net of withholding taxes ( 2,186 ) 350 3 ( 2,189 ) — — —

Other 1 — — 1 — — —

Balance as of December 31, 2024 $ 108,821 16,747 $ 167 $ 1,254,239 $ ( 879,407 ) 3,355 $ ( 266,178 )

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(in thousands)

Cash flows from operating activities attributable to continuing operations:

Net (loss) income and comprehensive (loss) income $ ( 122,404 ) $ ( 187,952 ) $ 69,115

Loss from discontinued operations, net of tax — — 4,023

(Loss) income from continuing operations ( 122,404 ) ( 187,952 ) 73,138

Adjustments to reconcile income from continuing operations to net cash provided by operating activities attributable to continuing operations:

Cash flows from operating activities:

Net loss and comprehensive loss $ ( 41,704 ) $ ( 122,404 ) $ ( 187,952 )

Adjustments to reconcile net loss to net cash provided by operating activities

Loss on impairments and disposal of assets 2,584 5,437 6,590

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Deferred income taxes 2,793 ( 4,692 ) 132,666

Change in fair value of contingent consideration — — ( 8,249 )

Bad debt expense 171 1,752 4,101

Amortization of debt issuance costs 2,168 3,137 6,432

Write-off of previously-capitalized debt issuance costs — — 1,066

Amortization of debt discount 331 — 1,475

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Other, net ( 278 ) ( 1,291 ) ( 449 )

Net cash provided by operating activities attributable to continuing operations 67,571 42,967 131,256

Cash flows from investing activities attributable to continuing operations:

Net cash provided by operating activities 62,258 67,571 42,967

Cash flows from investing activities

Capital expenditures ( 11,220 ) ( 12,528 ) ( 11,443 )

Purchase of equity investment — — ( 16,440 )

Proceeds from the sale of equity investment — — 46,312

Other investing activities 2 50 7

Net cash (used in) provided by investing activities attributable to continuing operations ( 12,478 ) ( 27,876 ) 10,067

Cash flows from financing activities attributable to continuing operations:

Net cash used in investing activities ( 11,218 ) ( 12,478 ) ( 27,876 )

Cash flows from financing activities

Payments related to net-share settlement of stock-based compensation, net of proceeds from exercise of stock options ( 2,186 ) ( 1,088 ) ( 3,411 )

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Other financing activities ( 552 ) 1 —

Net cash (used in) provided by financing activities attributable to continuing operations ( 242,006 ) 32,536 ( 63,347 )

Total cash (used in) provided by continuing operations ( 186,913 ) 47,627 77,976

Discontinued operations:

Net cash provided by operating activities attributable to discontinued operations — — 3,317

Total cash provided by discontinued operations — — 3,317

Net cash (used in) provided by financing activities ( 56,502 ) ( 242,006 ) 32,536

Net (decrease) increase in cash, cash equivalents, restricted cash and restricted cash equivalents ( 5,462 ) ( 186,913 ) 47,627

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Non-cash investing activities:

(Decrease) increase in capital expenditures included in accounts payable and accrued expenses $ ( 377 ) $ ( 294 ) $ ( 4,793 )

Increase (decrease) in capital expenditures included in accounts payable and accrued expenses $ 128 $ ( 377 ) $ ( 294 )

Supplemental cash flow information:

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LendingTree operates what it believes to be the leading online consumer platform that connects consumers with the choices they need to be confident in their financial decisions.

The Company offers consumers tools and resources, including free credit scores, that facilitate comparison-shopping for mortgage loans, home equity loans and lines of credit, auto loans, credit cards, deposit accounts, personal loans, student loans, small business loans, insurance quotes, sales of insurance policies and other related offerings.

The Company offers consumers tools and resources, including free credit scores, that facilitate comparison-shopping for mortgage loans, home equity loans and lines of credit, auto loans, credit cards, deposit accounts, personal loans, small business loans, insurance quotes, sales of insurance policies and other related offerings.

The Company primarily seeks to match in-market consumers with multiple providers on its marketplace who can provide them with competing quotes for loans, deposit products, insurance or other related offerings they are seeking.

The Company also serves as a valued partner to lenders and other providers seeking an efficient, scalable and flexible source of customer acquisition with directly measurable benefits, by matching the consumer inquiries it generates with these providers.

The consolidated financial statements include the accounts of LendingTree and all its wholly-owned entities, except Home Loan Center, Inc.

(“HLC”) subsequent to its bankruptcy filing on July 21, 2019 which resulted in the Company's loss of a controlling interest in HLC under applicable accounting standards.

The consolidated financial statements include the accounts of LendingTree and all its wholly-owned entities.

Intercompany transactions and accounts have been eliminated.

The HLC bankruptcy case was closed on July 14, 2021.

The HLC entity was legally dissolved in the first quarter of 2022.

See Note 21—Discontinued Operations for additional information.

Discontinued Operations

The LendingTree Loans business, which consisted of originating various consumer mortgage loans through HLC (the “LendingTree Loans Business”), is presented as discontinued operations in the accompanying consolidated balance sheets, consolidated statements of operations and comprehensive income (loss) and consolidated cash flows for all periods presented, where applicable.

The notes accompanying these consolidated financial statements reflect the Company's continuing operations and, unless otherwise noted, exclude information related to the discontinued operations.

See Note 21 — Discontinued Operations for additional information.

Basis of Presentation

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The Company's contractual right to the match fee consideration is contemporaneous with the satisfaction of the performance obligation to deliver a loan request to the customer.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Revenue from Consumer products is generated by match and other upfront fees for clicks or call transfers, as well as from closing fees, approval fees and upfront service and subscription fees.

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As of the second quarter of 2023, the Company discontinued providing its credit services product to consumers and no longer receives upfront fees and subscription fees.

Under ASC Topic 606, the timing of recognizing revenue for closing fees and approval fees is accelerated to the point when a loan request or a credit card consumer is delivered to the customer, as opposed to when the consumer loan is closed by the lender or credit card approval is made by the issuer.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

the lender or credit card approval is made by the issuer.

The Company's contractual right to closing fees and approval fees is not contemporaneous with the satisfaction of the performance obligation to deliver a loan request or a credit card consumer to the customer.

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This estimate is based on the Company's historical closing rates and historical time between when a consumer request for a loan or credit card is delivered to the lender or card issuer and when the loan is closed by the lender or approved by the card issuer.

The time between satisfaction of the Company's performance obligation and when the Company's right to consideration becomes unconditional varies across products but is generally less than 90 days for auto loans, personal loans, student loans and credit card approvals.

The time between satisfaction of the Company's performance obligation and when the Company's right to consideration becomes unconditional for small business loans is generally less than 5 years.

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Recoveries collected — 56 —

Assets held for sale (Note 9)

371 ( 371 ) —

Assets held for sale — 371 ( 371 )

Balance, end of the period $ 1,407 $ 2,222 $ 2,317

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Hosting Arrangement that is a Service Contract

Subsequent to the adoption of ASU 2018-15 in the first quarter of 2020, as described below, qualifying implementation costs incurred in a hosting arrangement that is a service contract are capitalized and deferred on a straight-line basis over the term of the hosting arrangement, which is typically one to five years .

Qualifying implementation costs incurred in a hosting arrangement that is a service contract are capitalized and deferred on a straight-line basis over the term of the hosting arrangement, which is typically one to five years .

These costs are capitalized to prepaid and other current assets and other non-current assets on the balance sheet, and the associated amortization expense is included within general and administrative expense on the statement of operations and comprehensive income (loss).

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Interest is recorded on potential tax contingencies as a component of income tax expense and recorded net of any applicable related income tax benefit.

For the year ended December 31, 2021, the Company followed the incremental or “with” and “without” approach to intraperiod tax allocation for determination of the amount of tax benefit to allocate to continuing operations as prescribed in ASC 740-20-45-7.

In accordance with the accounting standard for uncertainty in income taxes, liabilities for uncertain tax positions are recognized based on the two-step process prescribed by the accounting standards.

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Non-cash compensation expense for single cliff-vesting grants with a market condition are recognized on a straight-line basis, while graded-vesting grants with a market condition use graded vesting expense attribution.

LENDINGTREE, INC.

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Excess tax benefits and deficiencies that arise due to the difference in the measure of stock compensation and the amount deductible for tax purposes are recorded in income tax expense within the consolidated statement of operations and comprehensive income (loss), and are classified as a component of operating cash flows within the consolidated statements of cash flows.

comprehensive income (loss), and are classified as a component of operating cash flows within the consolidated statements of cash flows.

Litigation Settlements and Contingencies

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Actual results could differ from those estimates.

Significant estimates underlying the accompanying consolidated financial statements, including discontinued operations, include:

Significant estimates underlying the accompanying consolidated financial statements include:

the recoverability of long-lived assets, goodwill and intangible assets;

the determination of income taxes payable and deferred income taxes, including related valuation allowances;

fair value of assets acquired in a business combination;

contingent consideration related to business combinations;

litigation accruals;

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Due to the nature of the mortgage lending industry, interest rate fluctuations may negatively impact future revenue from the Company's marketplace.

For the years ended December 31, 2023 and December 31, 2022, and December 31, 2021 there were no network partners accounting for more than 10% of total revenue.

For the year ended December 31, 2024, two network partners accounted for 22 % and 11 %, respectively, of total consolidated revenue, all of which was recorded within the Insurance segment.

For the years December 31, 2023, and December 31, 2022 there were no network partners accounting for more than 10% of total revenue.

Lenders and lead purchasers participating on the Company's marketplace can offer their products directly to consumers through brokers, mass marketing campaigns or through other traditional methods of credit distribution.

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Recently Adopted Accounting Pronouncements

In November 2023, the FASB issued ASU 2023-07 which expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.

This ASU is effective for annual periods beginning after December 15, 2023, and interim periods in fiscal years beginning after December 15, 2024.

Early adoption is permitted, including adoption in interim periods.

An entity should adopt the guidance as of the beginning of the earliest period presented.

The Company adopted this ASU on December 31, 2024.

See Note 20—Segment Information for further information.

In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06, which simplifies the accounting for convertible instruments, amends the derivatives scope exception guidance for contracts in an entity’s own equity, and amends the related earnings-per-share guidance.

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Accumulated deficit ( 571,794 ) 44,447 ( 527,347 )

The adoption of ASU 2020-06 did not impact our cash flows or compliance with debt covenants.

In May 2021, the FASB issued ASU 2021-04 to clarify and reduce diversity in accounting for modifications or exchanges of freestanding equity-classified written call options that remain equity classified after modification or exchange.

The amendments clarify that a modification of the terms or conditions, or an exchange of a freestanding equity-classified written call option that remains equity classified after modification or exchange, should be accounted for as an exchange of the original instrument for a new instrument.

This ASU is effective for annual and interim reporting periods beginning after December 15, 2021.

Early adoption is permitted, including adoption in interim periods.

An entity should adopt the guidance as of the beginning of its annual fiscal year.

The amendments should be applied prospectively to modifications or exchanges occurring on or after the date of adoption.

The Company adopted ASU 2021-04 in the second quarter of 2021.

In December 2019, the FASB issued ASU 2019-12, which simplifies the accounting for income taxes by removing certain exceptions to the general principles in ASC Topic 740, Income Taxes, and clarifies certain aspects of the current guidance to improve consistency among reporting entities.

This ASU is effective for annual and interim reporting periods beginning after December 15, 2020.

Early adoption is permitted, including adoption in interim periods.

Entities electing early adoption must adopt all amendments in the same period.

Most amendments must be applied prospectively while others are to be applied on a

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

retrospective basis for all periods presented or a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the fiscal year of adoption.

The Company adopted ASU 2019-12 in the first quarter of 2021.

The amendments applicable to the Company required prospective application, and do not have material impacts to its consolidated financial statements.

Recently Issued Accounting Pronouncements

This ASU is effective for annual periods beginning after December 15, 2023, and interim periods in fiscal years beginning after December 15, 2024.

Early adoption is permitted, including adoption in interim periods.

An entity should adopt the guidance as of the beginning of the earliest period presented.

The Company is evaluating the impact this ASU will have on its consolidated financial statements and whether to early adopt.

In December 2023, the FASB issued ASU 2023-09 which expands annual disclosure requirements for income taxes, primarily through disclosure about disaggregated information about an entity's effective tax rate reconciliation and information on income taxes paid.

1 unchanged sentence

The guidance will be applied on a prospective basis with the option to adopt the guidance retrospectively.

The Company is evaluating the impact this ASU will have on its consolidated financial statements and whether to early adopt.

The Company is evaluating the impact this ASU will have on its consolidated financial statements.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In November 2024, the FASB issued ASU 2024-03 which requires the disaggregated disclosure of specific expense categories, including purchases of inventory, employee compensation, depreciation, and amortization, within relevant income statement captions.

This ASU also requires disclosure of the total amount of selling expenses along with the definition of selling expenses.

The ASU is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.

Early adoption is permitted, including adoption in interim periods.

The Company is currently evaluating the impact this ASU will have on its consolidated financial statements.

NOTE 3— REVENUE

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Home $ 128,854 $ 143,753 $ 289,383

Credit cards 62,000 100,229 93,420

Personal loans 101,412 100,124 144,148

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The contract asset recorded within prepaid and other current assets on the consolidated balance sheets related to estimated variable consideration was $ 20.5 million and $ 13.7 million on December 31, 2024 and 2023, respectively.

The contract liability recorded within accrued expenses and other current liabilities on the consolidated balance sheets related to upfront fees paid by consumers in the Company's Consumer business was $ 0.9 million at December 31, 2022.

As the contract liability was in the Ovation business that was closed during 2023, there is no contract liability at December 31, 2023.

During 2023, the Company recognized revenue of $ 0.9 million that was included in the contract liability balance at December 31, 2022.

As the contract liability was in the Ovation business that was closed during 2023, there was no contract liability at December 31, 2023.

During 2023, the Company recognized revenue of $ 0.9 million that was included in the contract liability balance at December 31, 2022.

1 unchanged sentence

The Company recognizes increases or decreases to such revenue from prior periods.

The Company recognized an immaterial increase to such revenue from prior periods in 2023, and increases to such revenue from prior periods of $ 0.5 million and $ 0.7 million in 2022 and 2021, respectively.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The Company recognized an increase of $ 0.4 million to such revenue from prior periods in 2024, an immaterial increase to such revenue from prior periods in 2023, and an increase of $ 0.5 million to such revenue from prior periods in 2022.

NOTE 4— CASH AND RESTRICTED CASH

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Total cash, cash equivalents, restricted cash and restricted cash equivalents $ 106,594 $ 112,056

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 5— PROPERTY AND EQUIPMENT

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The fair values of each reporting unit were determined using a combination of the income approach and the market approach valuation methodologies.

The Company will continue to monitor each of the reporting units and the impact of business or economic changes on the fair value of the reporting unit.

Changes in the timing of the recovery of the mortgage business, inflation, interest rates and other changes in current expectations could cause an impairment to the Insurance, Mortgage, or Consumer reporting units.

Intangible assets with indefinite lives relate to the Company's trademarks.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Intangible Assets with Definite Lives

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Customer lists 13.6 years 69,700 ( 36,559 ) 33,141

Trademarks and tradenames 5.0 years 1,300 ( 1,278 ) 22

Balance at December 31, 2024 $ 69,700 $ ( 36,559 ) $ 33,141

5 unchanged sentences

Balance at December 31, 2023 $ 77,400 $ ( 36,922 ) $ 40,478

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

During 2023 certain trademarks and tradenames and customer list intangible assets became fully amortized, reducing the cost and accumulated amortization in the table above.

During 2024 a trademark and tradename intangible asset became fully amortized, reducing the cost and accumulated amortization in the table above.

In the fourth quarter of 2024, the Company made the decision to cease offering its student loan products and plans to be substantially completed in the first quarter of 2025.

An impairment charge of $ 1.4 million was recorded in the fourth quarter of 2024 associated with student loan customer list intangible assets with an original cost of $ 6.4 million

Amortization of intangible assets with definite lives is computed on a straight-line basis and, based on balances as of December 31, 2024, future amortization is estimated to be as follows (in thousands) :

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NOTE 8— EQUITY INVESTMENTS

In January 2022, the Company acquired an equity interest in EarnUp Inc.

(“EarnUp”) for $ 15.0 million.

EarnUp is a consumer-first mortgage payment platform that intelligently automates loan payment scheduling and helps consumers better manage their money and improve their financial well-being.

On February 28, 2020, the Company acquired an equity interest in Stash Financial, Inc.

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On January 6, 2021, the Company acquired an additional equity interest for $ 1.2 million.

On October 18, 2021, the Company entered into a stock transfer agreement with third parties to sell a portion of its Stash equity securities for $ 46.3 million.

The Company sold $ 35.3 million in October and closed on an additional $ 11.0 million in November 2021.

The Company recorded a realized gain of $ 27.9 million based on the sale of Stash equity securities under the stock transfer agreement, which is included within other income on the consolidated statement of operations and comprehensive income.

Stash is a consumer investing and banking platform.

Stash brings together banking, investing, and financial services education into one seamless experience offering a full suite of personal investment accounts, traditional and Roth IRAs, custodial investment accounts, and banking services, including checking accounts and debit cards with a Stock-Back® rewards program.

On October 18, 2021, the Company entered into a stock transfer agreement with third parties to sell a portion of its Stash equity securities for $ 46.3 million with a cost basis of $ 18.4 million.

The Company recorded a realized gain of $ 27.9 million based on the sale of Stash equity securities under the stock transfer agreement.

In 2021, the Company recorded a net unrealized gain on the investment in Stash of $ 95.4 million as a result of an adjustment to the fair value of the Stash equity securities based on observable market events.

In the third quarter of 2023, the Company determined there was an impairment indicator related to its Stash investment and performed a valuation of the investment.

Based on the valuation, the Company determined the estimated fair value was below the carrying value of the investment and recorded an impairment charge of $ 113.1 million.

Based on the valuation, the Company determined the estimated fair value was below

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

the carrying value of the investment and recorded an impairment charge of $ 113.1 million.

The Company determined the fair value by using a market approach and a DCF analysis.

Determining the fair value using a DCF analysis and a market analysis requires the exercise of significant judgments, including judgments about the appropriate discount rate, perpetual growth rates, including short-term revenue and EBITDA, the amount and timing of expected future cash flows, and the revenue exit multiple.

In the third quarter of 2024, the Company was informed that Stash executed a term sheet for additional funding.

As a result, the Company determined there was an impairment indicator related to its Stash investment and performed a valuation of the investment.

The Company determined the fair value by predominately modeling its value of the investment based on the new funding terms utilizing an option pricing model.

Based on the valuation of the Stash investment, the Company determined the estimated fair value was below the carrying value of the investment and recorded an impairment charge of $ 43.4 million.

As of December 31, 2024, the carrying value of the Company’s investment in Stash was $ 1.7 million.

In January 2022, the Company acquired an equity interest in EarnUp Inc.

(“EarnUp”) for $ 15.0 million.

EarnUp is a consumer-first mortgage payment platform that intelligently automates loan payment scheduling and helps consumers better manage their money and improve their financial well-being.

In the third quarter of 2024, the Company determined there was an impairment indicator related to its EarnUp investment and recorded an impairment charge of $ 15.0 million.

In the second quarter of 2023, the Company recorded an impairment charge of $ 1.4 million on one of its investment in equity securities.

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As of December 31, 2022, there had been no impairments to the acquisition cost of the equity securities.

NOTE 9— ASSETS AND LIABILITIES HELD FOR SALE

In the fourth quarter of 2022, the Company approved a plan to sell an asset group associated with the Company's Consumer segment.

The asset group was expected to be sold in 2023 to an unrelated third party and is classified, at its carrying value, as current assets held for sale and current liabilities held for sale in the consolidated balance sheet as of December 31, 2022.

In the first quarter of 2023, the third party withdrew the letter of intent to purchase the asset group held for sale.

The Company made the decision to close the Ovation credit services business.

As a result, the Company recorded asset impairment

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

charges of $ 4.2 million, of which $ 2.1 million related to intangible assets, $ 1.7 million related to property and equipment, and $ 0.4 million related to an operating lease right-of-use asset.

Ovation was closed in mid-2023.

The following table presents information related to the major classes of assets and liabilities that were classified as held for sale (in thousands) :

December 31, 2022

Accounts receivable, net of allowance $ 1,353

Prepaid and other current assets 79

Property and equipment, net of accumulated depreciation of $ 1,102

Operating lease right-of-use assets 436

Intangible assets, net of accumulated amortization of $ 3,857

Other non-current assets 13

Total assets held for sale $ 5,689

Accounts payable, trade $ 253

Accrued expenses and other current liabilities 2,551

Operating lease liabilities 105

Total liabilities held for sale $ 2,909

NOTE 9— ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES

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Customer deposits and escrows 7,673 7,732

Contribution to LendingTree Foundation — 500

Current lease liabilities 5,799 7,387

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Weighted average diluted common shares 13,269 12,941 12,793

For the year ended December 31, 2023, the Company had a loss from continuing operations and, as a result, no potentially dilutive securities were included in the denominator for computing diluted loss per share, because the impact would have been anti-dilutive.

For the year ended December 31, 2024, the Company had a net loss and, as a result, no potentially dilutive securities were included in the denominator for computing diluted loss per share, because the impact would have been anti-dilutive.

Accordingly, the weighted average basic shares outstanding was used to compute loss per share.

Approximately 0.2 million shares related to potentially dilutive securities were excluded from the calculation of diluted loss per share for the year ended December 31, 2024 because their inclusion would have been anti-dilutive.

For the year ended December 31, 2024 the weighted average shares that were anti-dilutive included options to purchase 0.9 million shares of common stock and immaterial amount of restricted stock units.

For the year ended December 31, 2023, the Company had a net loss and, as a result, no potentially dilutive securities were included in the denominator for computing diluted loss per share, because the impact would have been anti-dilutive.

Accordingly, the weighted average basic shares outstanding was used to compute loss per share.

An immaterial amount of shares related to potentially dilutive securities were excluded from the calculation of diluted loss per share for the year ended December 31, 2023 because their inclusion would have been anti-dilutive.

For the year ended December 31, 2023 the weighted average shares that were anti-dilutive included options to purchase 1.2 million shares of common stock and 0.5 million restricted stock units.

For the year ended December 31, 2022, the Company had a loss from continuing operations and, as a result, no potentially dilutive securities were included in the denominator for computing diluted loss per share, because the impact would have been anti-dilutive.

For the year ended December 31, 2022, the Company had a net loss and, as a result, no potentially dilutive securities were included in the denominator for computing diluted loss per share, because the impact would have been anti-dilutive.

Accordingly, the weighted average basic shares outstanding was used to compute loss per share.

Approximately 0.2 million shares related to potentially dilutive securities were excluded from the calculation of diluted loss per share for the year ended December 31, 2022 because their inclusion would have been anti-dilutive.

For the year ended December 31, 2022 the weighted average shares that were anti-dilutive included options to purchase 1.0 million shares of common stock and 0.4 million restricted stock units.

For the year ended December 31, 2022, the weighted average shares that were anti-dilutive, and therefore excluded from the calculation of diluted income per share, included options to purchase 1.0 million shares of common stock and 0.4 million restricted stock units.

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See Note 14—Debt for additional information.

On January 1, 2022, the Company adopted ASU 2020-06 using the modified retrospective method.

Following the adoption, the if-converted method is used for diluted net income per share calculation of our convertible notes.

Prior to the adoption of ASU 2020-06 the dilutive impact of the convertible notes was calculated using the treasury stock method.

The if-converted method is used for diluted net income per share calculation of our convertible notes.

See Note 2—Significant Accounting Policies for additional information.

Approximately 0.6 million shares related to the potentially dilutive shares of the Company's common stock associated with the 0.50 % Convertible Senior Notes due July 15, 2025 were excluded from the calculation of diluted loss per share for the year ended December 31, 2024 because their inclusion would have been anti-dilutive.

Approximately 2.1 million shares related to the potentially dilutive shares of the Company's common stock associated with the 0.50 % Convertible Senior Notes due July 15, 2025 and the 0.625 % Convertible Senior Notes due June 1, 2022 were excluded from the calculation of diluted loss per share for the year ended December 31, 2022 because their inclusion would have been anti-dilutive and were excluded from diluted income per share for the year ended December 31, 2021 since the conversion price of the Notes was greater than the average market price of the Company's common stock during the period.

Shares of the Company's stock associated with warrants issued by the Company in 2017 and 2020 were excluded from the calculation of diluted (loss) income per share for the years ended December 31, 2023 and 2022 because their inclusion would have been anti-dilutive and were excluded for the year ended December 31, 2021 since the strike price of the warrants was greater than the average market price of the Company's common stock during the relevant periods.

Approximately 1.2 million shares related to the potentially dilutive shares of the Company's common stock associated with the 0.50 % Convertible Senior Notes due July 15, 2025 were excluded from the calculation of diluted loss per share for the year ended December 31, 2023 because their inclusion would have been anti-dilutive.

In 2021, the Company implemented an employee stock purchase plan, which did not have a material impact to the calculation of diluted shares.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Equity Distribution Agreement

In July 2024, the Company 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 the Company may sell up to an aggregate of $ 50.0 million of shares of the Company's common stock.

No sales were made under the Equity Distribution Agreement during the year ended December 31, 2024.

Common Stock Repurchases

The Company has a plan authorized for the repurchase of LendingTree's common stock.

The Company did no t purchase shares of its common stock during the year ended December 31, 2023.

During the years ended December 31, 2022 and 2021, the Company purchased 379,895 and 334,253 shares, respectively, of its common stock for aggregate consideration of $ 43.0 million and $ 40.0 million, respectively.

The Company did no t purchase shares of its common stock during the years ended December 31, 2024 and 2023.

During the year ended December 31, 2022 the Company purchased 379,895 shares of its common stock for aggregate consideration of $ 43.0 million, respectively.

At December 31, 2024, $ 96.7 million remains authorized for share repurchase.

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For the years ended December 31, 2024, 2023, and 2022, the Company recognized $ 4.7 million, $ 7.4 million, and $ 12.0 million, respectively, of income tax benefit, including state taxes, related to non-cash compensation.

Additionally, for the year ended December 31, 2023 and 2022, the Company recognized excess tax expense of $ 7.8 million and $ 5.1 million, respectively, and for the year ended December 31, 2021, the Company recognized excess tax benefit of $ 11.7 million, including state taxes, in income tax expense.

Additionally, for the year ended December 31, 2024, 2023, and 2022 the Company recognized excess tax expense of $ 4.4 million, $ 7.8 million, and $ 5.1 million, respectively.

See Note 2—Significant Accounting Policies, for additional information regarding excess tax benefits and deficiencies.

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During the year ended December 31, 2024, the total intrinsic value of stock options that were exercised was $ 4.2 million.

As there were no options exercised for the year ended December 31, 2023, no cash was received from stock option exercises.

During the year ended December 31, 2023, there were no stock options granted.

During the years ended December 31, 2022 and 2021, the Company granted stock options with a weighted average grant date fair value per share of $ 53.21 and $ 128.86 , respectively, of which the vesting periods include (a) immediately upon grant, (b) earlier of one year from grant date and the Company's annual meeting of stockholders for 2023, (c) 33 % over a period of three years from the grant date, (d) 25 % over a period of four years from the grant date, and (e) certain grants to executive officers that vest over periods of up to six years .

Cash received from stock option exercises was $ 1.4 million and there was no related actual tax benefit realized due to the full valuation allowance against net deferred tax assets for the year ended December 31, 2024.

During the years ended December 31, 2024 and 2023, there were no stock options granted.

During the year ended December 31, 2022, the Company granted stock options with a weighted average grant date fair value per share of $ 53.21 , of which the vesting periods include (a) immediately upon grant, (b) earlier of one year from grant date and the Company's annual meeting of stockholders for 2023, and (c) 33 % over a period of three years from the grant date.

For purposes of determining stock-based compensation expense, the weighted average grant date fair value per share of the stock options was estimated using the Black-Scholes option pricing model, which requires the use of various key assumptions.

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— — 5.00 - 6.00 years

5.00 - 6.00 years

Expected dividend (2)

Expected volatility (3)

Risk-free interest rate (4)

— — 53 % - 56 %

Risk-free interest rate (4)

— — 1.62 % - 3.23 %

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This method was utilized for the stock options due to a lack of historical exercise behavior by the Company's employees.

(2) For all stock options granted during the years ended December 31, 2022 and 2021, no dividends are expected to be paid over the contractual term of the stock options, resulting in a zero expected dividend rate.

(2) For all stock options granted during the year ended December 31, 2022, no dividends are expected to be paid over the contractual term of the stock options, resulting in a zero expected dividend rate.

(3) The expected volatility rate is based on the historical volatility of the Company's common stock.

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During the year ended December 31, 2020, the Company granted stock options with a weighted-average grant date fair value per share of $ 142.54 .

The single cliff-vesting stock options granted during the year ended December 31, 2020 have a vest date of March 31, 2024.

The single cliff-vesting stock options granted during the year ended December 31, 2020 had a vest date of March 31, 2024.

The graded-vesting stock options granted during the year ended December 31, 2020 have a vesting schedule with vesting dates of December 31, 2024, December 31, 2025 and December 31, 2026.

1 unchanged sentence

The net after-tax shares acquired through exercise of these stock options are subject to a two-year post-exercise holding requirement.

The single cliff-vesting stock options with a market condition granted in 2020 have a target number of shares that vest upon achieving a targeted total shareholder return performance of 81 % stock price appreciation and a maximum of 31,940 shares for achieving superior performance.

No shares will vest unless 41 % of the targeted performance is achieved.

The performance measurement period ends on March 31, 2024.

The single cliff-vesting stock options with a market condition granted in 2020 had a target number of shares that vest upon achieving a targeted total shareholder return performance of 81 % stock price appreciation and a maximum of 31,940 shares for achieving superior performance.

No shares would vest unless 41 % of the targeted performance is achieved.

At March 31, 2024, the target number of shares expired due to the actual total shareholder return performance not meeting the 41 % of the targeted performance measure, as reflected in the table above.

The graded-vesting stock options with a market condition granted in 2020 have a target number of shares that vest upon achieving a targeted total shareholder return performance of 135 % stock price appreciation and a maximum of 363,464 shares for achieving superior performance.

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The performance measurement period ends on March 31, 2025.

The performance measurement period for stock options with a market condition granted in 2019 ended on March 31, 2023.

The grant had a target number of shares of 16,247 that would vest upon achieving a targeted total shareholder return performance of 81 % stock price appreciation and a maximum of 27,132 shares for achieving superior performance.

No shares will vest unless 41 % of the targeted performance is achieved.

At March 31, 2023, the target number of shares expired due to the

For all stock options with market conditions, time-based service vesting conditions would also have to be satisfied in order for shares to become fully vested and no longer subject to forfeiture.

LENDINGTREE, INC.

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

actual total shareholder return performance not meeting the 41 % of the targeted performance measure, as reflected in the table above.

For all stock options with market conditions, time-based service vesting conditions would also have to be satisfied in order for shares to become fully vested and no longer subject to forfeiture.

As of December 31, 2024, a maximum of 363,464 may be earned for achieving superior performance up to 167 % of the remaining unvested target number of shares.

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The total fair value of RSUs that vested during the years ended December 31, 2024, 2023, and 2022 was $ 10.8 million, $ 6.9 million and $ 11.5 million, respectively.

Restricted Stock Units with Performance Conditions

A summary of changes in outstanding nonvested RSUs with performance conditions is as follows:

RSUs with Performance Conditions

Restricted Stock Units with Market Conditions

A summary of changes in outstanding nonvested RSUs with market conditions is as follows:

RSUs with Market Conditions (a)

Number of Units Weighted Average Grant Date Fair Value

Nonvested at December 31, 2023 — $ —

Granted 69,000 35.83

Vested ( 23,000 ) 37.02

Forfeited — —

Nonvested at December 31, 2024 46,000 $ 35.24

No RSUs with performance conditions were granted in 2023 or 2021.

As of December 31, 2023, there was no unrecognized compensation cost related to RSUs with performance conditions.

The total fair value of RSUs with performance conditions that vested during the year ended December 31, 2021 was $ 0.9 million.

(a) During the year ended December 31, 2024, the Company granted RSUs with market conditions that will vest if the Company's 45 trading day average closing stock prices equals or exceeds certain price hurdles ($ 41.17 , $ 52.94 and $ 64.70 ) during the performance period of March 1, 2024 to March 1, 2028.

Upon achievement of each price hurdle, one-half of the awards will vest immediately, and the other half of the awards will vest on the first anniversary of the achievement date.

For purposes of determining stock-based compensation expense, the weighted average grant date fair value per share of the RSUs with market conditions was estimated using the Monte Carlo simulation model, which requires the use of various key assumptions.

Expected term (1)

Expected volatility (2)

Risk-free interest rate (3)

Expected dividend (4)

LENDINGTREE, INC.

1 unchanged sentence

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Restricted Stock Awards with Performance Conditions

No RSAs with performance conditions were granted in 2023, 2022, or 2021.

During 2018, the Company granted time-vested RSAs with a performance condition to its Chairman and Chief Executive Officer, which vested through December 31, 2021.

The terms of this award were fixed in compensation agreements in July 2017 with a total grant date fair value of $ 21.9 million.

The performance condition was tied to the Company's operating results during the first six months of 2018, and was met.

The total fair value of RSAs with performance conditions that vested during the year ended December 31, 2021 was $ 4.1 million.

(1) The expected term of RSUs with market conditions granted was calculated using a four-year performance period plus one year to account for the time-based vesting requirement.

(2) The expected volatility rate is based on the historical volatility of the Company's common stock.

(3) The risk-free interest rate is specific to the date of grant.

The risk-free interest rate is based on U.S.

Treasury yields for notes with comparable expected terms as the awards in effect at the grant date.

(4) For all RSUs with market conditions granted, no dividends are expected to be paid over the contractual term of the stock options, resulting in a zero expected dividend rate.

As of December 31, 2024, there was approximately $ 0.9 million of unrecognized compensation cost related to RSUs with market conditions.

These costs are expected to be recognized over a weighted-average period of approximately 1.9 years.

The total fair value of RSUs with market conditions that vested during the year ended December 31, 2024 was $ 1.2 million.

Restricted Stock Awards with Market Conditions

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Employee Stock Purchase Plan

During 2021, the Company implemented an employee stock purchase plan (“ESPP”), under which a total of 262,731 shares of the Company's common stock were reserved for issuance.

The Company has an employee stock purchase plan (“ESPP”), under which a total of 262,731 shares of the Company's common stock were reserved for issuance.

The ESPP is a tax-qualified plan under Section 423 of the Internal Revenue Code.

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During the year ended December 31, 2023, 64,549 shares were purchased under the ESPP at a weighted average purchase price of $ 19.03 per share, resulting in cash proceeds of $ 1.2 million.

During the year ended December 31, 2022, 30,375 shares were purchased under the ESPP at a weighted average price of $ 27.19 per share, resulting in cash proceeds of $ 0.8 million.

As of December 31, 2024 and 2023, 116,574 and 162,264 shares, respectively, were available for issuance under the ESPP.

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Year Ended December 31,

2024 2023 2022

Expected term (1)

0.50 years 0.50 years

0.50 years 0.50 years 0.50 years

Expected dividend (2)

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4.76 % - 5.50 %

0.19 % - 2.51 %

(1) The expected term was calculated using the time period between the grant date and the purchase date.

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(3) The expected volatility rate is based on the historical volatility of the Company's common stock.

(4) The risk-free interest rate is specific to the date of grant.

The risk-free interest rate is based on U.S.

Treasury yields for notes with comparable expected terms as the Employee Stock Purchase Rights, in effect at the grant date.

LENDINGTREE, INC.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(4) The risk-free interest rate is specific to the date of grant.

The risk-free interest rate is based on U.S.

Treasury yields for notes with comparable expected terms as the Employee Stock Purchase Rights, in effect at the grant date.

NOTE 13— INCOME TAXES

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Current income tax expense 1,527 2,177 353

Deferred income tax (benefit) expense:

Deferred income tax expense (benefit):

Federal 947 ( 3,383 ) 98,772

State 1,846 ( 1,309 ) 33,894

Deferred income tax (benefit) expense ( 4,692 ) 132,666 10,908

Income tax (benefit) expense $ ( 2,515 ) $ 133,019 $ 11,298

Deferred income tax expense (benefit) 2,793 ( 4,692 ) 132,666

Income tax expense (benefit) $ 4,320 $ ( 2,515 ) $ 133,019

A reconciliation of the income tax expense (benefit) to the amounts computed by applying the statutory federal income tax rate to income (loss) from continuing operations before income taxes is shown as follows (in thousands) :

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Increase (decrease) in valuation allowance 5,045 17,087 139,374

Remeasurement of state deferred tax 776 73 305

Expiration of state net operating loss carryforwards 535 595 789

Global intangible low-taxed income inclusion 420 420 30

Other, net 519 1,391 885

Income tax (benefit) expense $ ( 2,515 ) $ 133,019 $ 11,298

Income tax expense (benefit) $ 4,320 $ ( 2,515 ) $ 133,019

LENDINGTREE, INC.

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Non-cash compensation expense 23,953 28,126

Property and equipment 833 —

Intangible assets 1,882 11,379

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Property and equipment — ( 1,563 )

Equity investment — ( 25,756 )

Other ( 499 ) ( 826 )

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Interest and, if applicable, penalties are recognized related to unrecognized tax benefits in income tax expense.

Interest and penalties on unrecognized tax benefits included in income tax expense of an immaterial amount has been recognized for the tax year ended December 31, 2022.

For the years ended December 31, 2023 and 2021 interest is not currently required to be recorded, as there have been no tax attributes included in income tax returns filed for those tax periods to require consideration of interest expense.

Interest and penalties on unrecognized tax benefits included in income tax expense of an immaterial amount has been recognized for the tax years ended December 31, 2023 and 2022.

For the year ended December 31, 2024 interest is not currently required to be recorded, as there have been no tax attributes included in income tax returns filed for those tax periods to require consideration of interest expense.

As of December 31, 2024 and 2023, the accrual for unrecognized tax benefits, including interest, was $ 3.7 million and $ 3.4 million, respectively, which would benefit the effective tax rate if recognized.

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The 2025 Notes will mature on July 15, 2025, unless earlier repurchased, redeemed or converted.

On March 8, 2023, the Company repurchased approximately $ 190.6 million in principal amount of its 2025 Notes, through individual privately-negotiated transactions with certain holders of the 2025 Notes, for $ 156.3 million in cash plus accrued and unpaid interest of approximately $ 0.1 million.

On December 7, 2023, the Company repurchased approximately $ 100.2 million in principal amount of its 2025 Notes, through individual privately-negotiated transactions with certain holders of the 2025 Notes, for $ 81.2 million in cash plus accrued and unpaid interest of approximately $ 0.2 million.

During the year ended December 31, 2023, the Company recognized a gain on the extinguishment of debt of $ 53.3 million, a loss on the write-off of unamortized debt issuance costs of $ 3.2 million and incurred debt repayment costs of $ 1.6 million, all of which are included in interest income/expense, net in the consolidated statements of operations and comprehensive income.

In the second quarter of 2024, the Company repurchased approximately $ 161.3 million in principal amount of the 2025 Notes for $ 151.7 million plus accrued and unpaid interest of approximately $ 0.3 million.

In the third quarter of 2024, the Company repurchased approximately $ 7.6 million in principal amount of the 2025 Notes for $ 7.2 million.

During the year ended December 31, 2024, the Company recognized a gain on the extinguishment of debt of $ 10.1 million and a loss on the write-off of unamortized debt issuance costs of $ 1.1 million, both of which are included in interest (expense) income, net in the consolidated statements of operations and comprehensive income.

In the first quarter of 2023, the Company repurchased approximately $ 190.6 million in principal amount of its 2025 Notes, through individual privately-negotiated transactions with certain holders of the 2025 Notes, for $ 156.3 million in cash plus accrued and unpaid interest of approximately $ 0.1 million.

In the fourth quarter of 2023, the Company repurchased approximately $ 100.2 million in principal amount of its 2025 Notes, through individual privately-negotiated transactions with certain holders of the 2025 Notes, for $ 81.2 million in cash plus accrued and unpaid interest of approximately $ 0.2 million.

During the year ended December 31, 2023, the Company recognized a gain on the extinguishment of debt of $ 53.3 million, a loss on the write-off of unamortized debt issuance costs of $ 3.2 million and incurred debt repayment costs of $ 1.6 million, all of which are included in interest (expense) income, net in the consolidated statements of operations and comprehensive income.

The initial conversion rate of the 2025 Notes is 2.1683 shares of the Company's common stock per $1,000 principal amount of 2025 Notes (which is equivalent to an initial conversion price of approximately $ 461.19 per share).

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equal in right of payment to any of the Company’s unsecured indebtedness that is not so subordinated;

effectively junior in right of payment to any of the Company’s secured indebtedness, including borrowings under the senior secured credit facility, described below, to the extent of the value of the assets securing such indebtedness;

effectively junior in right of payment to any of the Company’s secured indebtedness, including borrowings under the senior secured credit facility and term loan, described below, to the extent of the value of the assets securing such indebtedness;

and structurally junior to all indebtedness and other liabilities (including trade payables) of the Company’s subsidiaries.

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• if the Company calls such 2025 Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date, but only with respect to the notes called for redemption;

• upon the occurrence of specified corporate events including but not limited to a fundamental change.

Holders of the 2025 Notes were not entitled to convert the 2025 Notes during the calendar quarter ended December 31, 2023 as the last reported sale price of the Company's common stock, for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on September 30, 2023, was not greater than or equal to 130 % of the conversion price of the 2025 Notes on each applicable trading day.

Holders of the 2025 Notes are not entitled to convert the

LENDINGTREE, INC.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

2025 Notes during the calendar quarter ended March 31, 2024 as the last reported sale price of the Company's common stock, for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on December 31, 2023, was not greater than or equal to 130 % of the conversion price of the 2025 Notes on each applicable trading day.

• upon the occurrence of specified corporate events including but not limited to a fundamental change.

Holders of the 2025 Notes were not entitled to convert the 2025 Notes during the calendar quarter ended December 31, 2024 as the last reported sale price of the Company's common stock, for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on September 30, 2024, was not greater than or equal to 130 % of the conversion price of the 2025 Notes on each applicable trading day.

Holders of the 2025 Notes are not entitled to convert the 2025 Notes during the calendar quarter ended March 31, 2025 as the last reported sale price of the Company's common stock, for at least 20 trading days (whether or not consecutive) during the period of 30 consecutive trading days ending on December 31, 2024, was not greater than or equal to 130 % of the conversion price of the 2025 Notes on each applicable trading day.

On or after March 13, 2025, until the close of business on the second scheduled trading day immediately preceding the maturity date of the 2025 Notes, holders of the 2025 Notes may convert all or a portion of their 2025 Notes regardless of the foregoing conditions.

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If the market price per share of the common stock, as measured under the terms of the 2025 Notes, exceeds the conversion price of the 2025 Notes, the 2025 Notes could have a dilutive effect, unless the Company elects, subject to certain conditions, to settle the principal amount of the 2025 Notes and any conversion premium in cash.

Accounting for the Notes After Adoption of ASU 2020-06

The Company adopted ASU 2020-06 on January 1, 2022 as further described in Note 2—Significant Accounting Policies in the notes to the consolidated financial statements included elsewhere in this report.

3 unchanged sentences

See Note 2—Significant Accounting Policies in the notes to the consolidated financial statements included elsewhere in this report for additional information.

Accounting for the Notes Before Adoption of ASU 2020-06

The initial measurement of convertible debt instruments that may be settled in cash was separated into a debt and an equity component whereby the debt component was based on the fair value of a similar instrument that does not contain an equity conversion option.

The separate components of debt and equity of the Company’s 2025 Notes were determined using an interest rate of 5.30 %, which reflects the nonconvertible debt borrowing rate of the Company at the date of issuance.

As a result, the initial components of debt and equity were $ 455.6 million and $ 119.4 million, respectively.

Financing costs related to the issuance of the 2025 Notes were approximately $ 15.1 million, of which $ 12.0 million were allocated to the liability component and were being amortized to interest expense over the term of the debt and $ 3.1 million were allocated to the equity component.

During 2024, the Company recorded interest expense on the 2025 Notes of $ 1.9 million which consisted of $ 0.9 million associated with the 0.50 % coupon rate and $ 1.0 million associated with the amortization of the debt issuance costs.

During 2023, the Company recorded interest expense on the 2025 Notes of $ 4.3 million which consisted of $ 2.1 million associated with the 0.50 % coupon rate and $ 2.2 million associated with the amortization of the debt issuance costs.

During 2021, the Company recorded interest expense on the 2025 Notes of $ 27.2 million which consisted of $ 2.9 million associated with the 0.50 % coupon rate, $ 22.1 million associated with the accretion of the debt discount, and $ 2.2 million associated with the amortization of the debt issuance costs.

The debt discount was being amortized over the term of the debt prior to the adoption of ASU 2020-06.

During 2022, the Company recorded interest expense on the 2025 Notes of $ 5.9 million which consisted of $ 2.9 million associated with the 0.50 % coupon rate and $ 3.0 million associated with the amortization of the debt issuance costs.

As of December 31, 2024, the fair value of the 2025 Notes is estimated to be approximately $ 109.8 million using the Level 1 observable input of the last quoted market price on December 31, 2024.

2 unchanged sentences

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

A summary of the gross carrying amount, debt issuance costs, and net carrying value of the liability component of the 2025 Notes, all of which is recorded as a non-current liability in the December 31, 2023 consolidated balance sheet, are as follows (in thousands) :

A summary of the gross carrying amount, debt issuance costs, and net carrying value of the liability component of the 2025 Notes, all of which is recorded as a current liability in the December 31, 2024 consolidated balance sheet, are as follows (in thousands) :

2024 December 31,

2 unchanged sentences

Net carrying amount $ 114,976 $ 281,867

The Company intends 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 $ 115.3 million outstanding principal amount of its 2025 Notes.

On May 31, 2017, the Company issued $ 300.0 million aggregate principal amount of its 0.625 % Convertible Senior Notes due June 1, 2022 (the “2022 Notes”) in a private placement.

1 unchanged sentence

The initial conversion rate of the 2022 Notes was 4.8163 shares of the Company's common stock per $1,000 principal amount of 2022 Notes (which is equivalent to an initial conversion price of approximately $ 207.63 per share).

Accounting for the Notes After Adoption of ASU 2020-06

3 unchanged sentences

See Note 2—Significant Accounting Policies in the notes to the consolidated financial statements included elsewhere in this report for additional information.

Accounting for the Notes Before Adoption of ASU 2020-06

The separate components of debt and equity of the Company’s 2022 Notes were determined using an interest rate of 5.36 %, which reflects the nonconvertible debt borrowing rate of the Company at the date of issuance.

As a result, the initial components of debt and equity were $ 238.4 million and $ 61.6 million, respectively.

Financing costs related to the issuance of the 2022 Notes were approximately $ 9.3 million, of which $ 7.4 million were allocated to the liability component and were being amortized to interest expense over the term of the debt and $ 1.9 million were allocated to the equity component.

On July 24, 2020, the Company used approximately $ 234.0 million of the net proceeds from the issuance of the 2025 Notes to repurchase approximately $ 130.3 million principal amount of the 2022 Notes, including the payment of accrued and unpaid interest of approximately $ 0.1 million, through separate transactions with certain holders of the 2022 Notes.

Of the consideration paid, $ 126.0 million was allocated to the extinguishment of the liability component of the notes, while the remaining $ 107.9 million was allocated to the reacquisition of the equity component and recorded as a reduction to additional paid-in capital in the consolidated statement of shareholders’ equity.

The Company recognized a loss on debt extinguishment of $ 7.8 million in the third quarter of 2020.

During 2022, the Company recorded interest expense on the 2022 Notes of $ 0.8 million which consisted of $ 0.4 million associated with the 0.625 % coupon rate and $ 0.4 million associated with the amortization of the debt issuance costs.

During 2021, the Company recorded interest expense on the 2022 Notes of $ 9.5 million which consisted of $ 1.1 million associated with the 0.625 % coupon rate, $ 7.5 million associated with the accretion of the debt discount, and $ 0.9 million associated with the amortization of the debt issuance costs.

Convertible Note Hedge and Warrant Transactions

3 unchanged sentences

On July 24, 2020, the Company paid $ 124.2 million to the counterparties for the 2020 Hedge transactions.

The 2020 Hedge transactions cover 1.2 million shares of the Company’s common stock, the same number of shares initially underlying the 2025

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Notes, and are exercisable upon any conversion of the 2025 Notes.

The 2020 Hedge transactions cover 1.2 million shares of the Company’s common stock, the same number of shares initially underlying the 2025 Notes, and are exercisable upon any conversion of the 2025 Notes.

The 2020 Hedge transactions are expected generally to reduce the potential dilution to the Company's common stock upon conversion of the 2025 Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of the converted 2025 Notes, as the case may be, in the event that the market price per share of common stock, as measured under the terms of the 2020 Hedge transactions, is greater than the strike price of the 2020 Hedge transactions, which initially corresponds to the initial conversion price of the 2025 Notes, or approximately $ 461.19 per share of common stock.

3 unchanged sentences

If the market price per share of the common stock, as measured under the terms of the 2020 Warrants, exceeds the strike price of the 2020 Warrants, the 2020 Warrants could have a dilutive effect, unless the Company elects, subject to certain conditions, to settle the 2020 Warrants in cash.

In connection with the December 7, 2023 and the March 8, 2023 repurchases of the 2025 Notes noted above, the Company entered into agreements with the counterparties for the 2020 Hedge and 2020 Warrants transactions to terminate a portion of these call spread transactions effective December 7, 2023 and March 8, 2023, respectively, in notional amounts corresponding to the principal amount of the 2025 Notes repurchased.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

In connection with the repurchases of the 2025 Notes noted above, the Company entered into agreements with the counterparties for the 2020 Hedge and 2020 Warrants transactions to terminate the respective portions of these call spread transactions effective as of each settlement date in notional amounts corresponding to the principal amount of the 2025 Notes repurchased.

Subsequent to such terminations, the outstanding portion of the 2020 Hedge covers 0.3 million shares of the Company's common stock and the 2020 Warrants to acquire 0.3 million shares of the Company's common stock remain outstanding.

The 2020 Hedge and 2020 Warrants transactions are indexed to, and potentially settled in, the Company's common stock and the net cost of $ 63.0 million has been recorded as a reduction to additional paid-in capital in the consolidated statement of shareholders’ equity.

2017 Hedge and Warrants

On May 31, 2017, in connection with the issuance of the 2022 Notes, the Company entered into Convertible Note Hedge (the “2017 Hedge”) and warrant transactions with respect to the Company’s common stock.

The Company used approximately $ 18.1 million of the net proceeds from the 2022 Notes to pay for the cost of the 2017 Hedge, after such cost was partially offset by the proceeds from the warrant transactions.

On May 31, 2017, the Company paid $ 61.5 million to the counterparties for the 2017 Hedge transactions.

The 2017 Hedge transactions initially covered 1.4 million shares of the Company’s common stock, the same number of shares initially underlying the 2022 Notes, and were exercisable upon any conversion of the 2022 Notes.

The 2017 Hedge transactions expired on June 1, 2022 upon the maturity of the Notes.

On May 31, 2017, the Company sold to the counterparties, warrants (the “2017 Warrants”) to acquire 1.4 million shares of the Company's common stock at an initial strike price of $ 266.39 per share, which represented a premium of 70 % over the last reported sale price of the common stock of $ 156.70 on May 24, 2017 receiving proceeds of approximately $ 43.4 million.

The warrants expired on December 12, 2022.

2021 Credit Facility

On September 15, 2021, the Company entered into a credit agreement (the “Credit Agreement”), consisting of a $ 200.0 million revolving credit facility (the “Revolving Facility”), which matures on September 15, 2026, and a $ 250.0 million delayed draw term loan facility (the “Term Loan Facility” and together with the Revolving Facility, the “Credit Facility”), which matures on September 15, 2028.

On September 15, 2021, the Company entered into a credit agreement (the “Credit Agreement”), consisting of a $ 200.0 million revolving credit facility (the “Revolving Facility”), which matures on September 15, 2026, and a $ 250.0 million delayed draw term loan facility (the “2021 Term Loan” and together with the Revolving Facility, the “Credit Facility”), which matures on September 15, 2028.

The proceeds of the Revolving Facility can be used to finance working capital, for general corporate purposes and any other purpose not prohibited by the Credit Agreement.

On May 31, 2022 the Company received proceeds of $ 250.0 million from the Term Loan Facility and, on June 1, 2022, used $ 170.2 million of the proceeds to settle the Company's 2022 Notes, including interest.

On May 31, 2022 the Company received proceeds of $ 250.0 million from the 2021 Term Loan and, on June 1, 2022, used $ 170.2 million of the proceeds to settle the Company's 2022 Notes, including interest.

The remaining proceeds of $ 79.8 million may be used for general corporate purposes not prohibited by the Credit Agreement.

The Credit Facility replaces the Company's $ 500.0 million five-year senior secured revolving credit facility (the “Amended Revolving Credit Facility”) which was entered into on December 10, 2019.

As of December 31, 2023, the Company had $ 246.9 million borrowings outstanding under the Term Loan Facility bearing interest at the SOFR option rate of 9.21 % and had no borrowings under the Revolving Facility.

As of December 31, 2022, the Company had $ 248.8 million borrowings outstanding under the Term Loan Facility and had no borrowings under the Revolving Facility.

As of December 31, 2024, the Company had $ 243.8 million borrowings outstanding under the 2021 Term Loan bearing interest at the SOFR option rate of 8.47 % and had no borrowings under the Revolving Facility.

As of December 31, 2023, the Company had $ 246.9 million borrowings outstanding under the 2021 Term Loan and had no borrowings under the Revolving Facility.

As of December 31, 2024, borrowings of $ 2.5 million under the Term Loan Facility are recorded as current portion of long-term debt on the consolidated balance sheet.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The full amount of the Revolving Facility will be available on a same-day basis, with respect to base rate loans and upon advance notice with respect to SOFR rate loans, subject to customary terms and conditions.

1 unchanged sentence

Additionally, up to $ 20.0 million of the Revolving Facility will be available for the issuance of letters of credit.

At each of December 31, 2023 and December 31, 2022, the Company had outstanding one letter of credit issued in the amount of $ 0.2 million.

At December 31, 2023, the Company had outstanding one letter of credit issued in the amount of $ 0.2 million.

The Company’s borrowings under the Credit Facility bear interest at annual rates that, at the Company’s option, will be either:

6 unchanged sentences

The covenants, among other things, restrict additional indebtedness, liens, mergers or certain fundamental changes, asset dispositions, dividends and other restricted payments, transactions with affiliates, loans and investments and other matters customarily restricted in credit agreements of this type.

The Company is required to make mandatory prepayments of the outstanding principal amount of loans under the Term Loan Facility with the net cash proceeds from certain disposition of assets and the receipt of insurance proceeds upon certain casualty and condemnation events, in each case, to the extent not reinvested within a specified time period, from excess cash flow beyond stated threshold amounts, and from the incurrence of certain indebtedness.

The Company is required to make mandatory prepayments of the outstanding principal amount of loans under the Term Loan Facility with the net cash proceeds from certain disposition of

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

assets and the receipt of insurance proceeds upon certain casualty and condemnation events, in each case, to the extent not reinvested within a specified time period, from excess cash flow beyond stated threshold amounts, and from the incurrence of certain indebtedness.

The Company has the right to prepay its term loans under the Credit Agreement, in whole or in part, at any time without premium or penalty, subject to certain limitations and a 1.0 % soft call premium applicable during the first six months following the closing date.

6 unchanged sentences

The letter of credit fronting fee is 0 .125 % per annum on the face amount of each letter of credit.

With respect to the Term Loan Facility, the Company is required to pay an unused commitment fee quarterly in arrears on the difference between committed amounts and amounts actually borrowed under the Term Loan Facility equal to an applicable SOFR rate plus an applicable percentage of 3.75 % to 4.00 % per annum based on a first lien net leverage ratio.

The Company recognized $ 1.1 million in additional interest expense in the third quarter of 2021 due to the write-off of certain unamortized debt issuance costs associated with the Amended Revolving Credit Facility.

In addition to the remaining unamortized debt issuance costs associated with the Amended Revolving Credit Facility, debt issuance costs of $ 2.8 million

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

related to the Revolving Facility are being amortized to interest expense over the life of the Revolving Facility.

Debt issuance costs of $ 3.5 million related to the Term Loan Facility and the original issue discount $ 2.5 million paid on the undrawn term loan facility were amortized to interest expense over the delayed draw access period.

These deferred costs are included in prepaid and other current assets and other non-current assets in the Company's consolidated balance sheet.

With respect to the 2021 Term Loan, the Company is required to pay an unused commitment fee quarterly in arrears on the difference between committed amounts and amounts actually borrowed under the 2021 Term Loan equal to an applicable SOFR rate plus an applicable percentage of 3.75 % to 4.00 % per annum based on a first lien net leverage ratio.

During 2024, the Company recorded interest expense related to its Revolving Facility of $ 1.8 million which consisted of $ 0.9 million in unused commitment fees and $ 0.9 million associated with the amortization of the debt issuance costs.

During 2023, the Company recorded interest expense related to the Term Loan Facility of $ 22.2 million associated with borrowings bearing interest at the LIBO rate during the first six months of 2023 and the SOFR option rate during the last six months of 2023.

During 2024, the Company recorded interest expense related to the 2021 Term Loan of $ 22.8 million associated with borrowings bearing interest at the SOFR option rate.

During 2023, the Company recorded interest expense related to its Revolving Facility of $ 1.5 million which consisted of $ 0.6 million in unused commitment fees and $ 0.9 million associated with the amortization of the debt issuance costs.

During 2022, the Company recorded interest expense related to the Term Loan Facility of $ 18.2 million which consisted of $ 9.6 million associated with borrowings bearing interest at the LIBO rate, $ 5.1 million in unused commitment fees, $ 2.0 million associated with the amortization of the debt issuance costs, and $ 1.5 million associated with the amortization of the original issue discount.

During 2023, the Company recorded interest expense related to the 2021 Term Loan of $ 22.2 million which consisted of $ 22.2 million associated with borrowings bearing interest at the LIBO rate during the first six months of 2023 and the SOFR option rate during the last six months of 2023.

During 2022, the Company recorded interest expense related to its revolving facilities of $ 1.5 million which consisted of $ 0.6 million in unused commitment fees and $ 0.9 million associated with the amortization of the debt issuance costs.

During 2022, the Company recorded interest expense related to the 2021 Term Loan of $ 18.2 million which consisted of $ 9.6 million associated with borrowings bearing interest at the LIBO rate, $ 5.1 million in unused commitment fees, $ 2.0 million associated with the amortization of the debt issuance costs, and $ 1.5 million associated with the amortization of the original issue discount.

2024 Term Loan

On March 27, 2024, the Company entered into a $ 175.0 million first lien term loan facility (the “2024 Term Loan”), which matures on March 27, 2031.

The Company 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.

The proceeds of the 2024 Term Loan made on March 27, 2024 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 the 2025 Notes.

As of December 31, 2024, the Company had $ 115.6 million borrowings outstanding under the 2024 Term Loan bearing interest based on the SOFR rate of 10.1 %.

As of December 31, 2024, borrowings of $ 7.8 million under the 2024 Term Loan are recorded as current portion of long-term debt on the consolidated balance sheet.

The 2024 Term Loan is pre-payable at par, after 12 months of call protection (during which time prepayment would be at 101 % of par), or with respect to prepayments made with respect to a change of control, at 101 % of par, and carries a seven-year term.

The Company's borrowings under the 2024 Term Loan bear interest at annual rates at (i) a SOFR rate on a daily basis applicable for an interest period of one month and (ii) 5.75 %, with the opportunity for a one-time 25.00 basis point step-down at a gross first lien leverage ratio less than or equal to 3.75 x after six fiscal quarters from the date of closing.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

The 2024 Term Loan has certain financial covenants which are tested on a quarterly basis.

The covenants include a requirement for the Company to maintain a minimum cash balance of $ 40.0 million as of the last day of any fiscal quarter (or subject to certain conditions an average cash balance of $ 40.0 million based on the average cash balance as of the last day of each week during a fiscal quarter) and a minimum Consolidated EBITDA (as such term is defined in the 2024 Term Loan agreement dated as of March 27, 2024) based on the applicable quarter.

The Company was in compliance with all covenants at December 31, 2024.

In addition, the 2024 Term Loan contains mandatory prepayment events, affirmative and negative covenants and events of default customary for a transaction of this type.

In addition, the Company filed an ATM Shelf Registration (as defined in the 2024 Term Loan agreement) with the SEC in the third quarter of 2024.

In the event of a default in the minimum Consolidated EBITDA (as defined in the 2024 Term Loan agreement) covenant, the Company is 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.

Additionally, the Company may use the ATM Equity Program to maintain the $ 40.0 million minimum cash balance requirement in the 2024 Term Loan.

The Company is required to make mandatory prepayments of the outstanding principal amount of loans under the 2024 Term Loan with the net cash proceeds from certain disposition of assets and the receipt of insurance proceeds upon certain casualty and condemnation events, in each case, to the extent not reinvested within a specified time period, from excess cash flow beyond stated threshold amounts, and from the incurrence of certain indebtedness.

The 2024 Term Loan includes customary events of default, that include among other things, non-payment of principal, interest or fees, inaccuracy of representations and warranties, violation of certain covenants, cross default to certain other indebtedness, bankruptcy and insolvency events, material judgments, change of control, and certain material ERISA events.

The occurrence of a default could result in the acceleration of the obligations under the facility.

As security for its obligations under the facility, the Company granted a security interest to substantially all of the Company’s assets and the assets of its material subsidiaries, subject to certain exceptions.

With respect to the 2024 Term Loan, the Company incurred financing costs of $ 7.4 million upon closing consisting of $ 2.8 million of debt issuance costs and $ 3.1 million of original issue discount associated with the initial $ 125.0 million borrowing which are being amortized to interest expense over the life of the 2024 Term Loan and $ 1.5 million of debt issuance costs associated with the $ 50.0 million delayed draw term loan which are being deferred until the funds are drawn.

Additionally, the Company is required to pay an unused commitment fee quarterly in arrears in an amount equal to 1.50 % per annum on the amount of the undrawn portion of the delayed draw term loan commitments under the 2024 Term Loan.

During 2024, the Company recorded interest expense related to the 2024 Term Loan of $ 11.5 million which consisted of $ 10.3 million associated with borrowings bearing interest based on the SOFR rate, $ 0.6 million associated with unused commitment fees, $ 0.3 million associated with the amortization of debt issuance costs, and $ 0.3 million associated with the accretion of the original issue discount.

A summary of the gross carrying amount, debt issuance costs, original issue discount, and net carrying value of the 2024 Term Loan in the December 31, 2024 consolidated balance sheet, are as follows (in thousands):

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Current Portion

Gross carrying amount $ 7,813

Debt issuance costs 169

Unamortized original issue discount 189

Net carrying amount $ 7,455

Long-term Portion

Gross carrying amount $ 107,812

Debt issuance costs 2,333

Unamortized original issue discount 2,605

Net carrying amount $ 102,874

NOTE 15— COMMITMENTS

12 unchanged sentences

With respect to the matters disclosed in this Note 16, unless otherwise indicated, the Company is unable to estimate the possible loss or range of losses that could potentially result from the application of such non-monetary remedies.

In the ordinary course of business, we are party to litigation involving property, contract, intellectual property and a variety of other claims.

The amounts that may be recovered in such matters may be subject to insurance coverage.

On or about October 29, 2019, Joseph Mantha filed a class action lawsuit against QuoteWizard.com, LLC alleging claims in violation of the Telephone Consumer Protection Act.

On August 16, 2024, the U.S.

District Court of Massachusetts granted the plaintiff’s motion to certify a class.

Mediation in November 2024 was not successful.

As of December 31, 2024 and 2023, the Company had litigation settlement accruals of $ 3.9 million and $ 0.6 million, respectively.

The litigation settlement accruals relate to litigation matters that were either settled or a firm offer for settlement was extended, thereby establishing an accrual amount that is both probable and reasonably estimable.

See Note 21—Discontinued Operations in the notes to the consolidated financial statements included elsewhere in this report for additional information.

The litigation settlement accruals relate to litigation matters that were either settled or a firm offer for settlement was extended or an estimated settlement range has been determined, thereby establishing an accrual amount that is both probable and reasonably estimable.

NOTE 17— FAIR VALUE MEASUREMENTS

5 unchanged sentences

notes and warrants, and see Note 8—Equity Investments in the notes to the consolidated financial statements included elsewhere in this report for additional information on the equity investments.

Contingent consideration payments related to acquisitions are measured at fair value each reporting period using Level 3 unobservable inputs.

There were no changes in the fair value of the Company's Level 3 liabilities during the years ended December 31, 2023 and 2022 and the changes for the year ended December 31, 2021 are as follows (in thousands) :

Year Ended December 31,

Contingent consideration, beginning of period $ 8,249

Transfers into Level 3 —

Transfers out of Level 3 —

Total net losses included in earnings (realized and unrealized) ( 8,249 )

Purchases, sales and settlements:

Contingent consideration, end of period $ —

There was no contingent consideration liability at December 31, 2023 or 2022 because the final earnout period for the QuoteWizard acquisition ended on October 31, 2021.

NOTE 18— RELATED PARTY TRANSACTIONS

12 unchanged sentences

Matching contributions were approximately $ 2.3 million, $ 2.2 million and $ 2.8 million for the years ended December 31, 2024, 2023 and 2022, respectively.

NOTE 21— DISCONTINUED OPERATIONS

The LendingTree Loans Business is presented as discontinued operations in the accompanying consolidated financial statements.

The LendingTree Loans Business originated various consumer mortgage loans through HLC.

On June 6, 2012, the Company sold substantially all of the operating assets of HLC, including the LendingTree Loans Business, to a wholly-owned subsidiary of Discover Financial Services (“Discover”).

Discover generally did not assume liabilities of HLC that arose before the closing date, except for certain liabilities directly related to assets Discover acquired.

Upon closing of the sale of substantially all of the operating assets of HLC on June 6, 2012, HLC ceased to originate consumer loans.

Certain liability for losses on previously sold loans remained with HLC.

Litigation settlements and contingencies and legal fees associated with related bankruptcy and legal proceedings against the Company are included in discontinued operations in the accompanying consolidated financial statements.

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Home Loan Center, Inc.

Bankruptcy Filing

On June 21, 2019, the U.S.

District Court of Minnesota entered judgment in ResCap Liquidating Trust v.

Home Loan Center, Inc.

, against HLC for $ 68.5 million, see Litigation Related to Discontinued Operations below.

The judgment against HLC exceeded the assets of HLC, which were $ 11.2 million at July 21, 2019, including cash of $ 5.9 million.

On July 21, 2019, at the direction of the sole independent director of HLC, HLC voluntarily filed a petition under Chapter 11 of the United States Bankruptcy Code (the “Bankruptcy Code”) with the U.S.

Bankruptcy Court in the Northern District of California in San Jose, California (the “Bankruptcy Court”) in order to preserve assets for the benefit of all creditors of HLC.

On September 16, 2019, the Bankruptcy Court converted the bankruptcy to Chapter 7 of the Bankruptcy Code and appointed a Trustee to liquidate HLC's assets.

As a result of the voluntary petition, LendingTree, LLC was, as of the initial July 21, 2019 bankruptcy petition filing date, no longer deemed to have a controlling interest in HLC under applicable accounting standards.

As a result, HLC and its consolidated subsidiary were deconsolidated from the Company’s consolidated financial statements as of July 21, 2019.

The effect of such deconsolidation was the elimination of the consolidated assets and liabilities of HLC (and its consolidated subsidiary) from the Company’s consolidated balance sheets.

During its bankruptcy, HLC indicated that it believed that it had claims against HLC’s sole shareholder, LendingTree, LLC, and certain of its officers and directors, relating to the declaration of a dividend by HLC in January 2016 of $ 40.0 million.

In 2020, LendingTree, LLC and HLC entered into a settlement agreement in the amount of $ 36.0 million for the release of any and all claims against the Company defendants by HLC, including the dividend claim.

The Bankruptcy Court approved the settlement on July 16, 2020.

The $ 36.0 million settlement payment was made in the third quarter of 2020.

During the HLC bankruptcy, a bar date for claims against HLC was set, establishing a deadline for all HLC’s creditors to assert any claim they may have had against HLC.

Distributions were made to holders of allowed claims deemed timely filed.

After all distributions to creditors were made and HLC’s Chapter 7 bankruptcy estate was fully administered, the HLC bankruptcy case was closed on July 14, 2021.

Litigation Related to Discontinued Operations

Residential Funding Company

ResCap Liquidating Trust v.

Home Loan Center, Inc., Case No.

14-cv-1716 (U.S.

Ct., Minn.), successor to Residential Funding Company, LLC v Home Loan Center, Inc., No.

13-cv-3451 (U.S.

On or about December 16, 2013, Home Loan Center, Inc.

was served in the original captioned matter, which involves claims of Residential Funding Company, LLC (“RFC”) for damages for breach of contract and indemnification for certain residential mortgage loans as well as residential mortgage-backed securitizations (“RMBS”) containing mortgage loans.

Plaintiff then alleged that, after RFC filed for Chapter 11 protection, hundreds of proofs of claim were filed, many of which mirrored the litigation filed against RFC prior to its bankruptcy.

It filed substantially similar complaints against approximately 80 of the loan originators from whom RFC had purchased loans, including HLC.

In 2019, the U.S.

District Court of Minnesota entered a judgment against HLC.

S ee Home Loan Center, Inc.

Bankruptcy Filing above.

HLC’s filing under the Bankruptcy Code discussed above in Home Loan Center, Inc.

Bankruptcy Filing created an automatic stay of enforcement of the judgment entered against HLC.

On August 27, 2019, plaintiff filed a lawsuit captioned ResCap Liquidating Trust v.

LendingTree, LLC, et al., Case No.

19-cv-2360 (U.S.

Ct., Minn.) , seeking to hold the Company liable for the judgment against HLC.

In June 2020, the Company entered into a settlement with ResCap, pursuant to which, the Company agreed to, among other things, pay ResCap $ 58.5 million, less any amounts ResCap receives in the HLC bankruptcy.

In the third and fourth quarters of 2020, the Company made payments of $ 26.5 million and $ 6.4 million, respectively, to the ResCap Liquidating Trust and the ResCap Liquidating Trust, in turn, assigned its allowed claims against HLC to the Company.

In the second quarter of 2021, the Company received $ 8.6 million related to these amounts, from the final distributions in the HLC bankruptcy on account of the allowed claims that the ResCap Liquidating Trust had assigned to the Company.

Lehman Brothers Holdings, Inc.

Lehman Brothers Holdings Inc.

1st Advantage Mortgage, LLC et al., Case No.

08-13555 (SCC), Adversary Proceeding No.

16-01342 (SCC) (Bankr.

In February 2016, Lehman Brothers Holdings, Inc.

(“LBHI”) filed an Adversary Complaint against HLC and approximately 149 other defendants (the “Complaint”).

LENDINGTREE, INC.

AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

HLC’s filing under the Bankruptcy Code discussed above in Home Loan Center, Inc.

Bankruptcy Filing created an automatic stay of this proceeding.

On June 11, 2020, LBHI filed a lawsuit captioned Lehman Brothers Holdings Inc.

LendingTree, LLC, et al., Case No.

20-cv-01351 (U.S.

Ct., Minn.) , seeking to hold the Company liable for their allowed bankruptcy claim of $ 13.3 million.

In July 2021, the Company entered into a settlement with LBHI, which payment was made in the third quarter of 2021.

Financial Information of Discontinued Operations

The components of net loss reported as discontinued operations in the accompanying consolidated statements of operations and comprehensive income (loss) are as follows (in thousands) :

Year Ended December 31,

Other operating expenses ( 4,719 )

Loss before income taxes ( 4,719 )

Income tax benefit 696

Net loss $ ( 4,023 )

The results of discontinued operations include litigation settlements and contingencies and legal fees associated with legal proceedings against LendingTree, Inc.

or LendingTree, LLC that arose due to the LendingTree Loans Business or the HLC bankruptcy filing.

NOTE 20— SEGMENT INFORMATION

1 unchanged sentence

Home, Consumer, and Insurance.

Characteristics which were relied upon in making the determination of the reportable segments include the nature of the products, the organization's internal structure, and the information that is regularly reviewed by the CODM for the purpose of assessing performance and allocating resources.

Characteristics which were relied upon in making the determination of the reportable segments include the nature of the products, the organization's internal structure, and the information that is regularly reviewed by the CODM, the Company’s Chief Executive Officer, for the purpose of assessing performance and allocating resources.

The Home segment includes the following products:

2 unchanged sentences

The Consumer segment includes the following products:

credit cards, personal loans, small business loans, student loans, auto loans, deposit accounts, and other credit products such as credit repair and debt settlement.

credit cards, personal loans, small business loans, auto loans, deposit accounts, and other credit products such as credit repair and debt settlement.

The credit repair business was closed at the end of the second quarter of 2023.

In the fourth quarter of 2024, the Company made the decision to cease offering its student loan products and plans to be substantially completed in the first quarter of 2025.

The Insurance segment consists of insurance quote products and sales of insurance policies in our agency businesses.

The following tables are a reconciliation of segment profit, which is the Company's primary segment profitability measure, to income before income taxes and discontinued operations.

The following tables are a reconciliation of segment profit, which is the Company's primary segment profitability measure, to income before income taxes.

Segment cost of revenue and marketing expense represents the portion 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.

15 unchanged sentences

Amortization of intangibles 5,889

Goodwill impairment 38,600

Restructuring and severance 508

Litigation settlements and contingencies 3,797

Operating loss ( 40,611 )

Interest income, net 21,685

Operating income 44,627

Interest expense, net ( 27,849 )

Other expense ( 54,162 )

12 unchanged sentences

Amortization of intangibles 7,694

Goodwill impairment 38,600

Restructuring and severance 10,118

1 unchanged sentence

Operating loss ( 40,611 )

Interest expense, net ( 26,014 )

Other income 3,843

Interest income, net 21,685

Other expense ( 105,993 )

Loss before income taxes $ ( 124,919 )

7 unchanged sentences

Segment cost of revenue and marketing expense 186,299 221,531 207,239 982 616,051

Segment profit 153,352 143,497 113,464 53 410,366

Segment profit (loss) 103,084 174,578 91,834 ( 555 ) 368,941

Cost of revenue 57,769

4 unchanged sentences

Amortization of intangibles 25,306

Change in fair value of contingent consideration ( 8,249 )

Restructuring and severance 4,428

Litigation settlements and contingencies ( 18 )

Operating income 8,031

Operating loss ( 32,762 )

Interest expense, net ( 26,014 )

Other income 3,843

Income before income taxes and discontinued operations $ 84,436

Loss before income taxes $ ( 54,933 )

The CODM does not review information on segment assets and as such, no segment asset information is reported herein.

5 unchanged sentences

The Company 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 and non-cash charges for the accelerated vesting of certain equity awards of approximately $ 0.2 million.

The cash payments are expected to be substantially completed by the third quarter of 2024.

On April 6, 2023, the Company made the decision to close the Ovation credit services business ( the "Ovation Closure".) The Ovation Closure includes the elimination of approximately 197 employees, or 18 %, of the Company's current workforce.

The cash payments were completed by the third quarter of 2024.

As a result of the Ovation Closure, the Company incurred $ 2.1 million in restructuring expense in connection with cash expenditures for employee separation costs.

The Ovation Closure, including cash payments, is expected to be completed by the first quarter of 2024.

In connection with the Ovation Closure, in the first quarter of 2023, the Company recorded asset impairment charges of $ 4.2 million, of which $ 2.1 million related to intangible assets , $ 1.7 million related to property and equipment, and $ 0.4 million related to an operating lease right-of-use asset.

The cash payments for the Ovation Closure were completed in the first quarter of 2024.

On March 24, 2023, the Company committed to a workforce reduction plan (the “Reduction Plan”), to reduce operating costs.

The Reduction Plan includes the elimination of approximately 162 employees, or 13 %, of the Company’s current workforce.

The Reduction Plan includes the elimination of approximately 162 employees, or 13 %, of the Company’s workforce.

As a result of the Reduction Plan, the Company 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.

The Reduction Plan, including cash payments, is expected to be substantially completed by the end of the second quarter of 2024.

The Reduction Plan, including cash payments, was completed by the end of the third quarter of 2024.

During 2022, the Company completed workforce reductions in each of the first, second, and fourth quarters of approximately 75 employees, 25 employees, and 50 employees, respectively.

5 unchanged sentences

Employee separation payments 254 ( 7 ) ( 247 ) — —

Non-cash compensation — 205 — ( 205 ) —

Q2 2023 action

2 unchanged sentences

Employee separation payments 421 15 ( 436 ) — —

Non-cash compensation — 1,066 — ( 1,066 ) —

Employee separation payments 304 13 ( 317 ) — —

$ 709 $ 12 $ ( 721 ) $ — $ —

Accrued Balance at December 31, 2022 Income Statement Impact Payments Non-Cash Accrued Balance at December 31, 2023

Q3 2023 action

Employee separation payments — 683 ( 429 ) — 254

Non-cash compensation — 205 — ( 205 ) —

Q2 2023 action

Employee separation payments — 2,063 ( 2,029 ) — 34

Q1 2023 action

Employee separation payments — 4,253 ( 3,832 ) — 421

Non-cash compensation — 1,066 — ( 1,066 ) —

Employee separation payments 304 13 ( 317 ) — —

$ 304 $ 8,283 $ ( 6,607 ) $ ( 1,271 ) $ 709

2 unchanged sentences

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 8. Financial Statements and Supplementary Data