As filed with the Securities and Exchange Commission on NovemberMay 7, 20232024
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
| | | | | |
☒ | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the Quarterly Period Ended September 30, 2023March 31, 2024
Or
| | | | | |
☐ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from__________to__________ |
Commission File No. 001-38220
Angi Inc.
(Exact name of Registrant as specified in its charter) | | | | | | | | |
Delaware | | 82-1204801 |
(State or other jurisdiction of incorporation or organization) | | (I.R.S. Employer Identification No.) |
3601 Walnut Street, Denver, CO 80205
(Address of Registrant’sregistrant’s principal executive offices)
(303) 963-7200
(Registrant’s telephone number, including area code)
| | | | | | | | | | | | | | |
Securities registered pursuant to Section 12(b) of the Act: |
Title of each class | | Trading Symbol | | Name of exchange on which registered |
Class A Common Stock, par value $0.001 | | ANGI | | The Nasdaq Stock Market LLC |
Indicate by check mark whether the Registrantregistrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrantregistrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the Registrantregistrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrantregistrant was required to submit such files). Yes ☒ No ☐
Indicate by check mark whether the Registrantregistrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Large accelerated filer | ☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ | Smaller reporting company | ☐ | Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the Registrantregistrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐
Indicate by check mark whether the Registrantregistrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
As of NovemberMay 3, 2023,2024, the following shares of the Registrant’sregistrant’s common stock were outstanding:
| | | | | |
Class A Common Stock | 85,136,00079,722,608 | |
Class B Common Stock | 422,019,247 | |
Class C Common Stock | — | |
Total outstanding Common Stock | 507,155,247501,741,855 | |
TABLE OF CONTENTS
PART I
FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
ANGI INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited)
| | September 30, 2023 | | December 31, 2022 |
| (In thousands, except par value amounts) |
| March 31, 2024 | | | March 31, 2024 | | December 31, 2023 |
| (In thousands, except par value amounts) | | | (In thousands, except par value amounts) |
ASSETS | ASSETS | |
Cash and cash equivalents | Cash and cash equivalents | $ | 366,825 | | | $ | 321,155 | |
Cash and cash equivalents | |
Cash and cash equivalents | |
| Accounts receivable, net | |
Accounts receivable, net | |
Accounts receivable, net | Accounts receivable, net | 77,269 | | | 93,880 | |
Other current assets | Other current assets | 71,702 | | | 69,167 | |
| Total current assets | Total current assets | 515,796 | | | 484,202 | |
Total current assets | |
Total current assets | |
| Capitalized software, leasehold improvements and equipment, net | |
Capitalized software, leasehold improvements and equipment, net | |
Capitalized software, leasehold improvements and equipment, net | Capitalized software, leasehold improvements and equipment, net | 121,244 | | | 153,855 | |
Goodwill | Goodwill | 883,468 | | | 882,949 | |
Intangible assets, net | Intangible assets, net | 170,263 | | | 178,105 | |
Deferred income taxes | Deferred income taxes | 158,495 | | | 145,460 | |
Other non-current assets, net | Other non-current assets, net | 56,493 | | | 63,207 | |
| TOTAL ASSETS | TOTAL ASSETS | $ | 1,905,759 | | | $ | 1,907,778 | |
TOTAL ASSETS | |
TOTAL ASSETS | |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | LIABILITIES AND SHAREHOLDERS’ EQUITY | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | |
LIABILITIES: | LIABILITIES: | |
LIABILITIES: | |
LIABILITIES: | |
| Accounts payable | |
| Accounts payable | |
| Accounts payable | Accounts payable | $ | 52,790 | | | $ | 30,862 | |
Deferred revenue | Deferred revenue | 55,162 | | | 50,907 | |
Accrued expenses and other current liabilities | Accrued expenses and other current liabilities | 195,765 | | | 200,015 | |
| Total current liabilities | Total current liabilities | 303,717 | | | 281,784 | |
Total current liabilities | |
Total current liabilities | |
| Long-term debt, net | Long-term debt, net | 495,853 | | | 495,284 | |
Long-term debt, net | |
Long-term debt, net | |
| Deferred income taxes | |
Deferred income taxes | |
Deferred income taxes | Deferred income taxes | 2,923 | | | 2,906 | |
Other long-term liabilities | Other long-term liabilities | 57,989 | | | 76,426 | |
| | | Commitments and contingencies | Commitments and contingencies | |
| | Commitments and contingencies | |
| Commitments and contingencies | |
| SHAREHOLDERS’ EQUITY: | SHAREHOLDERS’ EQUITY: | |
Class A common stock, $0.001 par value; authorized 2,000,000 shares; issued 106,026 and 102,811 shares, respectively, and outstanding 84,760 and 82,600, respectively | 106 | | | 103 | |
Class B convertible common stock, $0.001 par value; authorized 1,500,000 shares; 422,019 and 422,019 shares issued and outstanding | 422 | | | 422 | |
SHAREHOLDERS’ EQUITY: | |
SHAREHOLDERS’ EQUITY: | |
Class A common stock, $0.001 par value; authorized 2,000,000 shares; issued 108,870 and 106,848 shares, respectively, and outstanding 81,402 and 82,208, respectively | |
Class A common stock, $0.001 par value; authorized 2,000,000 shares; issued 108,870 and 106,848 shares, respectively, and outstanding 81,402 and 82,208, respectively | |
Class A common stock, $0.001 par value; authorized 2,000,000 shares; issued 108,870 and 106,848 shares, respectively, and outstanding 81,402 and 82,208, respectively | |
Class B convertible common stock, $0.001 par value; authorized 1,500,000 shares; 422,019 shares issued and outstanding | |
Class C common stock, $0.001 par value; authorized 1,500,000 shares; no shares issued and outstanding | Class C common stock, $0.001 par value; authorized 1,500,000 shares; no shares issued and outstanding | — | | | — | |
Additional paid-in capital | Additional paid-in capital | 1,437,141 | | | 1,405,294 | |
Accumulated deficit | Accumulated deficit | (225,459) | | | (190,079) | |
Accumulated other comprehensive loss | (937) | | | (1,172) | |
Treasury stock, 21,266 and 20,211 shares, respectively | (169,581) | | | (166,184) | |
Accumulated other comprehensive income | |
Treasury stock, 27,468 and 24,640 shares, respectively | |
Total Angi Inc. shareholders’ equity | Total Angi Inc. shareholders’ equity | 1,041,692 | | | 1,048,384 | |
Noncontrolling interests | Noncontrolling interests | 3,585 | | | 2,994 | |
Total shareholders’ equity | Total shareholders’ equity | 1,045,277 | | | 1,051,378 | |
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 1,905,759 | | | $ | 1,907,778 | |
ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
| | Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | 2022 | | 2023 | | 2022 | |
| (In thousands, except per share data) |
| Three Months Ended March 31, | |
| Three Months Ended March 31, | |
| Three Months Ended March 31, | |
| 2024 | |
| 2024 | |
| 2024 | |
| (In thousands, except per share data) | |
| (In thousands, except per share data) | |
| (In thousands, except per share data) | |
Revenue | Revenue | $ | 371,837 | | | $ | 498,036 | | | $ | 1,139,312 | | | $ | 1,449,977 | | |
Cost of revenue (exclusive of depreciation shown separately below) | Cost of revenue (exclusive of depreciation shown separately below) | 28,737 | | | 109,057 | | | 102,440 | | | 335,826 | | |
Gross profit | 343,100 | | | 388,979 | | | 1,036,872 | | | 1,114,151 | | |
Cost of revenue (exclusive of depreciation shown separately below) | |
Cost of revenue (exclusive of depreciation shown separately below) | |
Gross Profit | |
Gross Profit | |
Gross Profit | |
Operating costs and expenses: | |
Operating costs and expenses: | |
Operating costs and expenses: | Operating costs and expenses: | | | | | | | | |
Selling and marketing expense | Selling and marketing expense | 204,006 | | | 234,397 | | | 621,628 | | | 711,357 | | |
Selling and marketing expense | |
Selling and marketing expense | |
General and administrative expense | |
General and administrative expense | |
General and administrative expense | General and administrative expense | 102,476 | | | 128,260 | | | 301,979 | | | 357,541 | | |
Product development expense | Product development expense | 21,497 | | | 15,816 | | | 72,358 | | | 54,629 | | |
Product development expense | |
Product development expense | |
Depreciation | |
Depreciation | |
Depreciation | Depreciation | 22,596 | | | 17,759 | | | 70,210 | | | 45,112 | | |
Amortization of intangibles | Amortization of intangibles | 2,633 | | | 3,805 | | | 7,958 | | | 11,413 | | |
Amortization of intangibles | |
Amortization of intangibles | |
Total operating costs and expenses | Total operating costs and expenses | 353,208 | | | 400,037 | | | 1,074,133 | | | 1,180,052 | | |
Operating loss | (10,108) | | | (11,058) | | | (37,261) | | | (65,901) | | |
Total operating costs and expenses | |
Total operating costs and expenses | |
Operating income (loss) | |
Operating income (loss) | |
Operating income (loss) | |
Interest expense | Interest expense | (5,037) | | | (5,030) | | | (15,100) | | | (15,078) | | |
Other income (expense),net | 3,891 | | | (2,296) | | | 12,890 | | | (4,437) | | |
Loss before income taxes | (11,254) | | | (18,384) | | | (39,471) | | | (85,416) | | |
Income tax benefit | 5,967 | | | 945 | | | 4,705 | | | 10,693 | | |
| Interest expense | |
Interest expense | |
Other income, net | |
Other income, net | |
Other income, net | |
Earnings (loss) from continuing operations before income taxes | |
Earnings (loss) from continuing operations before income taxes | |
Earnings (loss) from continuing operations before income taxes | |
Income tax provision | |
Income tax provision | |
Income tax provision | |
Net loss from continuing operations | |
Net loss from continuing operations | |
Net loss from continuing operations | |
Loss from discontinued operations, net of tax | |
Loss from discontinued operations, net of tax | |
Loss from discontinued operations, net of tax | |
Net loss | |
Net loss | |
Net loss | Net loss | (5,287) | | | (17,439) | | | (34,766) | | | (74,723) | | |
Net earnings attributable to noncontrolling interests | Net earnings attributable to noncontrolling interests | (69) | | | (40) | | | (614) | | | (379) | | |
Net earnings attributable to noncontrolling interests | |
Net earnings attributable to noncontrolling interests | |
Net loss attributable to Angi Inc. shareholders | |
Net loss attributable to Angi Inc. shareholders | |
Net loss attributable to Angi Inc. shareholders | Net loss attributable to Angi Inc. shareholders | $ | (5,356) | | | $ | (17,479) | | | $ | (35,380) | | | $ | (75,102) | | |
| Per share information from continuing operations: | |
| Per share information from continuing operations: | |
| Per share information from continuing operations: | |
Basic loss per share | |
Basic loss per share | |
Basic loss per share | |
Diluted loss per share | |
Diluted loss per share | |
Diluted loss per share | |
| Per share information attributable to Angi Inc. shareholders: | |
| Per share information attributable to Angi Inc. shareholders: | |
| Per share information attributable to Angi Inc. shareholders: | Per share information attributable to Angi Inc. shareholders: | |
Basic loss per share | Basic loss per share | $ | (0.01) | | | $ | (0.03) | | | $ | (0.07) | | | $ | (0.15) | | |
Basic loss per share | |
Basic loss per share | |
Diluted loss per share | |
Diluted loss per share | |
Diluted loss per share | Diluted loss per share | $ | (0.01) | | | $ | (0.03) | | | $ | (0.07) | | | $ | (0.15) | | |
| Stock-based compensation expense by function: | Stock-based compensation expense by function: | | |
| Stock-based compensation expense by function: | |
| Stock-based compensation expense by function: | |
| Selling and marketing expense | |
| Selling and marketing expense | |
| Selling and marketing expense | Selling and marketing expense | $ | 1,822 | | | $ | 1,544 | | | $ | 4,586 | | | $ | 4,674 | | |
General and administrative expense | General and administrative expense | 6,906 | | | 8,755 | | | 22,040 | | | 27,052 | | |
General and administrative expense | |
General and administrative expense | |
Product development expense | |
Product development expense | |
Product development expense | Product development expense | 2,013 | | | 2,077 | | | 7,122 | | | 7,052 | | |
Total stock-based compensation expense | Total stock-based compensation expense | $ | 10,741 | | | $ | 12,376 | | | $ | 33,748 | | | $ | 38,778 | | |
Total stock-based compensation expense | |
Total stock-based compensation expense | |
ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF COMPREHENSIVE OPERATIONS
(Unaudited)
| | Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | 2022 | | 2023 | | 2022 | |
| (in thousands) |
| Three Months Ended March 31, | |
| Three Months Ended March 31, | |
| Three Months Ended March 31, | |
| 2024 | |
| 2024 | |
| 2024 | |
| (in thousands) | |
| (in thousands) | |
| (in thousands) | |
Net loss | Net loss | $ | (5,287) | | | $ | (17,439) | | | $ | (34,766) | | | $ | (74,723) | | |
Other comprehensive (loss) income: | Other comprehensive (loss) income: | | |
Other comprehensive (loss) income: | |
Other comprehensive (loss) income: | |
Change in foreign currency translation adjustment | Change in foreign currency translation adjustment | (2,182) | | | (5,129) | | | 236 | | | (9,100) | | |
| Change in foreign currency translation adjustment | |
Change in foreign currency translation adjustment | |
Change in unrealized gains on available-for-sale marketable debt securities | |
Change in unrealized gains on available-for-sale marketable debt securities | |
Change in unrealized gains on available-for-sale marketable debt securities | |
Total other comprehensive (loss) income | |
Total other comprehensive (loss) income | |
Total other comprehensive (loss) income | Total other comprehensive (loss) income | (2,182) | | | (5,129) | | | 236 | | | (9,100) | | |
Comprehensive loss | Comprehensive loss | (7,469) | | | (22,568) | | | (34,530) | | | (83,823) | | |
Components of comprehensive (income) loss attributable to noncontrolling interests: | | |
Comprehensive loss | |
Comprehensive loss | |
Components of comprehensive income attributable to noncontrolling interests: | |
Components of comprehensive income attributable to noncontrolling interests: | |
Components of comprehensive income attributable to noncontrolling interests: | |
Net earnings attributable to noncontrolling interests | |
Net earnings attributable to noncontrolling interests | |
Net earnings attributable to noncontrolling interests | Net earnings attributable to noncontrolling interests | (69) | | | (40) | | | (614) | | | (379) | | |
Change in foreign currency translation adjustment attributable to noncontrolling interests | Change in foreign currency translation adjustment attributable to noncontrolling interests | 123 | | | 310 | | | (1) | | | 579 | | |
Comprehensive loss (income) attributable to noncontrolling interests | 54 | | | 270 | | | (615) | | | 200 | | |
Change in foreign currency translation adjustment attributable to noncontrolling interests | |
Change in foreign currency translation adjustment attributable to noncontrolling interests | |
Comprehensive income attributable to noncontrolling interests | |
Comprehensive income attributable to noncontrolling interests | |
Comprehensive income attributable to noncontrolling interests | |
Comprehensive loss attributable to Angi Inc. shareholders | Comprehensive loss attributable to Angi Inc. shareholders | $ | (7,415) | | | $ | (22,298) | | | $ | (35,145) | | | $ | (83,623) | | |
Comprehensive loss attributable to Angi Inc. shareholders | |
Comprehensive loss attributable to Angi Inc. shareholders | |
ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
Three and Nine Months Ended September 30,March 31, 2024 and 2023
(Unaudited)
| | | | Class A Common Stock $0.001 Par Value | |
| | | | Class A Common Stock $0.001 Par Value | |
| | | | Class A Common Stock $0.001 Par Value | |
| | | | | | | | | | | Accumulated Other Comprehensive Income (Loss) | |
| | | | | | | | | | | Accumulated Other Comprehensive Income (Loss) | |
| | | | | | | | | | | Accumulated Other Comprehensive Income (Loss) | | | | | | | | Total Shareholders' Equity |
| | | | | | | | | | | | | | | Additional Paid-in Capital | |
| | $ | |
| | $ | |
| | $ | |
| Balance as of December 31,2023 | |
| Balance as of December 31,2023 | |
| Balance as of December 31,2023 | |
Net (loss) earnings | |
Other comprehensive loss | |
Stock-based compensation expense | |
Issuance of common stock pursuant to stock-based awards, net of withholding taxes | |
| Purchase of treasury stock | |
Purchase of treasury stock | |
Purchase of treasury stock | |
| Other | |
| Other | |
| Other | |
Balance as of March 31, 2024 | |
| Balance as of December 31, 2022 | |
Balance as of December 31, 2022 | |
Balance as of December 31, 2022 | |
Net (loss) earnings | |
Other comprehensive income | |
Stock-based compensation expense | |
Issuance of common stock pursuant to stock-based awards, net of withholding taxes | |
Other | |
| | | | | Class A Common Stock $0.001 Par Value | | Class B Convertible Common Stock $0.001 Par Value | | Class C Common Stock $0.001 Par Value | | Total Angi Inc. Shareholders' Equity | |
| | | | | Accumulated Other Comprehensive Income (Loss) | | Total Shareholders' Equity |
| | | | | | | | | Additional Paid-in Capital | | Accumulated Deficit | | Treasury Stock | | Total Angi Inc. Shareholders' Equity | Noncontrolling Interests | |
| | $ | | Shares | | $ | | Shares | | $ | | Shares | | Accumulated Other Comprehensive Income (Loss) | Total Shareholders' Equity |
| | (In thousands) | |
Balance as of June 30, 2023 | | $ | 105 | | | 105,273 | | | $ | 422 | | | 422,019 | | | $ | — | | | — | | | $ | 1,426,280 | | | $ | (220,103) | | | $ | 1,122 | | | $ | (169,581) | | $ | 1,038,245 | | $ | 3,639 | | $ | 1,041,884 | |
Net (loss) earnings | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (5,356) | | | — | | | — | | | (5,356) | | 69 | | | (5,287) | |
Other comprehensive loss | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (2,059) | | | — | | | (2,059) | | | (123) | | | (2,182) | |
Stock-based compensation expense | | — | | | — | | | — | | | — | | | — | | | — | | | 12,104 | | | — | | | — | | | — | | | 12,104 | | | — | | | 12,104 | |
Issuance of common stock pursuant to stock-based awards, net of withholding taxes | | 1 | | | 753 | | | — | | | — | | | — | | | — | | | (1,243) | | | — | | | — | | | — | | | (1,242) | | | — | | | (1,242) | |
Balance as of March 31, 2023 | |
| Balance as of September 30, 2023 | | $ | 106 | | | 106,026 | | | $ | 422 | | | 422,019 | | | $ | — | | | — | | | $ | 1,437,141 | | | $ | (225,459) | | | $ | (937) | | | $ | (169,581) | | | $ | 1,041,692 | | | $ | 3,585 | | | $ | 1,045,277�� | |
| Balance as of December 31, 2022 | | $ | 103 | | | 102,811 | | | $ | 422 | | | 422,019 | | | $ | — | | | — | | | $ | 1,405,294 | | | $ | (190,079) | | | $ | (1,172) | | | $ | (166,184) | | | $ | 1,048,384 | | | $ | 2,994 | | | $ | 1,051,378 | |
Net (loss) earnings | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (35,380) | | | — | | | — | | | (35,380) | | | 614 | | | (34,766) | |
Other comprehensive income | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | 235 | | | — | | | 235 | | | 1 | | | 236 | |
Stock-based compensation expense | | — | | | — | | | — | | | — | | | — | | | — | | | 37,242 | | | — | | | — | | | — | | | 37,242 | | | — | | | 37,242 | |
Issuance of common stock pursuant to stock-based awards, net of withholding taxes | | 3 | | | 3,215 | | | — | | | — | | | — | | | — | | | (5,358) | | | — | | | — | | | — | | | (5,355) | | | — | | | (5,355) | |
| Purchase of treasury stock | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (3,397) | | | (3,397) | | | — | | | (3,397) | |
Balance as of March 31, 2023 | |
| Other | | — | | | — | | | — | | | — | | | — | | | — | | | (37) | | | — | | | — | | | — | | | (37) | | | (24) | | | (61) | |
Balance as of September 30, 2023 | | $ | 106 | | | 106,026 | | | $ | 422 | | | 422,019 | | | $ | — | | | — | | | $ | 1,437,141 | | | $ | (225,459) | | | $ | (937) | | | $ | (169,581) | | | $ | 1,041,692 | | | $ | 3,585 | | | $ | 1,045,277 | |
| Balance as of March 31, 2023 | |
ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITYCASH FLOWS
Three and Nine Months Ended September 30, 2022
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | |
| | | | Class A Common Stock $0.001 Par Value | | Class B Convertible Common Stock $0.001 Par Value | | Class C Common Stock $0.001 Par Value | | | | | | | | | | Total Angi Inc. Shareholders' Equity | | | | |
| | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | Accumulated Other Comprehensive (Loss) Income | | | | | | | Total Shareholders' Equity |
| | | | | | | | | | | | | | | | Additional Paid-in Capital | | Accumulated Deficit | | | Treasury Stock | | | Noncontrolling Interests | |
| | | $ | | Shares | | $ | | Shares | | $ | | Shares | | | | | | | |
| | | | (In thousands) | | |
Balance as of June 30, 2022 | | | | $ | 101 | | | 100,897 | | | $ | 422 | | | 422,019 | | | $ | — | | | — | | | $ | 1,374,200 | | | $ | (119,251) | | | $ | (393) | | | $ | (166,184) | | | $ | 1,088,895 | | | $ | 10,977 | | | $ | 1,099,872 | |
Net (loss) earnings | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (17,479) | | | — | | | — | | | (17,479) | | | 40 | | | (17,439) | |
Other comprehensive loss | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (4,819) | | | — | | | (4,819) | | | (310) | | | (5,129) | |
Stock-based compensation expense | | | | — | | | — | | | — | | | — | | | — | | | — | | | 13,304 | | | — | | | — | | | — | | | 13,304 | | | — | | | 13,304 | |
Issuance of common stock pursuant to stock-based awards, net of withholding taxes | | | | 1 | | | 853 | | | — | | | — | | | — | | | — | | | (2,121) | | | — | | | — | | | — | | | (2,120) | | | — | | | (2,120) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Adjustment to noncontrolling interests resulting from the reorganization of a foreign subsidiary | | | | | | | | | | | | | | | | 7,835 | | | | | | | | | 7,835 | | | (7,835) | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Other | | | | — | | | — | | | — | | | — | | | — | | | — | | | (4) | | | (1) | | | — | | | — | | | (5) | | | — | | | (5) | |
Balance as of September 30, 2022 | | | | $ | 102 | | | 101,750 | | | $ | 422 | | | 422,019 | | | $ | — | | | — | | | $ | 1,393,214 | | | $ | (136,731) | | | $ | (5,212) | | | $ | (166,184) | | | $ | 1,085,611 | | | $ | 2,872 | | | $ | 1,088,483 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Balance as of December 31, 2021 | | | | $ | 100 | | | 99,745 | | | $ | 422 | | | 422,019 | | | $ | — | | | — | | | $ | 1,350,457 | | | $ | (61,629) | | | $ | 3,309 | | | $ | (158,040) | | | $ | 1,134,619 | | | $ | 10,908 | | | $ | 1,145,527 | |
Net (loss) earnings | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (75,102) | | | — | | | — | | | (75,102) | | | 379 | | | (74,723) | |
Other comprehensive loss | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (8,521) | | | — | | | (8,521) | | | (579) | | | (9,100) | |
Stock-based compensation expense | | | | — | | | — | | | — | | | — | | | — | | | — | | | 40,971 | | | — | | | — | | | — | | | 40,971 | | | — | | | 40,971 | |
Issuance of common stock pursuant to stock-based awards, net of withholding taxes | | | | 2 | | | 2,005 | | | — | | | — | | | — | | | — | | | (6,045) | | | — | | | — | | | — | | | (6,043) | | | — | | | (6,043) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Purchase of treasury stock | | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | — | | | (8,144) | | | (8,144) | | | — | | | (8,144) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Adjustment to noncontrolling interests resulting from the reorganization of a foreign subsidiary | | | | | | | | | | | | — | | | — | | | 7,835 | | | | | | | | | 7,835 | | | (7,835) | | | — | |
Other | | | | — | | | — | | | — | | | — | | | — | | | — | | | (4) | | | — | | | — | | | — | | | (4) | | | (1) | | | (5) | |
Balance as of September 30, 2022 | | | | $ | 102 | | | 101,750 | | | $ | 422 | | | 422,019 | | | $ | — | | | — | | | $ | 1,393,214 | | | $ | (136,731) | | | $ | (5,212) | | | $ | (166,184) | | | $ | 1,085,611 | | | $ | 2,872 | | | $ | 1,088,483 | |
| | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 | | |
| (In thousands) |
Cash flows from operating activities attributable to continuing operations: | | | | | |
Net loss | $ | (1,317) | | | $ | (15,000) | | | |
Less: Loss from discontinued operations, net of tax | — | | | (1,013) | | | |
Net loss attributable to continuing operations | (1,317) | | | (13,987) | | | |
Adjustments to reconcile net loss to net cash provided by operating activities attributable to continuing operations: | | | | | |
Depreciation | 23,849 | | | 25,190 | | | |
Provision for credit losses | 15,910 | | | 23,731 | | | |
Stock-based compensation expense | 9,397 | | | 12,712 | | | |
Non-cash lease expense (including impairment of right-of-use assets) | 4,752 | | | 3,532 | | | |
Deferred income taxes | 1,253 | | | (282) | | | |
Amortization of intangibles | — | | | 2,662 | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Other adjustments, net | 384 | | | (366) | | | |
Changes in assets and liabilities, net of effects of acquisitions and dispositions: | | | | | |
Accounts receivable | (25,761) | | | (22,402) | | | |
Other assets | 13,320 | | | 4,758 | | | |
Accounts payable and other liabilities | (17,417) | | | (10,289) | | | |
Operating lease liabilities | (4,487) | | | (4,578) | | | |
Income taxes payable and receivable | 2,148 | | | 845 | | | |
Deferred revenue | 265 | | | (354) | | | |
Net cash provided by operating activities attributable to continuing operations | 22,296 | | | 21,172 | | | |
| | | | | |
Cash flows from investing activities attributable to continuing operations: | | | | | |
| | | | | |
Capital expenditures | (12,798) | | | (11,862) | | | |
Purchases of marketable debt securities | — | | | (12,362) | | | |
| | | | | |
| | | | | |
Proceeds from sales of fixed assets | 6 | | | 10 | | | |
| | | | | |
Net cash used in investing activities attributable to continuing operations | (12,792) | | | (24,214) | | | |
| | | | | |
Cash flows from financing activities attributable to continuing operations: | | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Purchases of treasury stock | (6,860) | | | — | | | |
| | | | | |
Withholding taxes paid on behalf of employees on net settled stock-based awards | (3,214) | | | (1,379) | | | |
| | | | | |
| | | | | |
| | | | | |
Net cash used in financing activities attributable to continuing operations | (10,074) | | | (1,379) | | | |
| | | | | |
Total cash used in continuing operations | (570) | | | (4,421) | | | |
Net cash used in operating activities attributable to discontinued operations | — | | | (2,111) | | | |
Net cash provided by investing activities attributable to discontinued operations | — | | | 57 | | | |
Total cash used in discontinued operations | — | | | (2,054) | | | |
Effect of exchange rate changes on cash and cash equivalents and restricted cash | (141) | | | 179 | | | |
Net decrease in cash and cash equivalents and restricted cash | (711) | | | (6,296) | | | |
Cash and cash equivalents and restricted cash at beginning of period | 364,301 | | | 322,136 | | | |
Cash and cash equivalents and restricted cash at end of period | $ | 363,590 | | | $ | 315,840 | | | |
ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
| | | | | | | | | | | | | |
| Nine Months Ended September 30, |
| 2023 | | 2022 | | |
| (In thousands) |
Cash flows from operating activities: | | | | | |
Net loss | $ | (34,766) | | | $ | (74,723) | | | |
| | | | | |
| | | | | |
Adjustments to reconcile net loss to net cash provided by operating activities: | | | | | |
Depreciation | 70,210 | | | 45,112 | | | |
Provision for credit losses | 67,288 | | | 82,216 | | | |
Stock-based compensation expense | 33,748 | | | 38,778 | | | |
Non-cash lease expense (including impairment of right-of-use assets) | 9,571 | | | 11,535 | | | |
Amortization of intangibles | 7,958 | | | 11,413 | | | |
Deferred income taxes | (13,015) | | | (13,950) | | | |
Foreign currency transaction (gain) loss | (510) | | | 6,520 | | | |
| | | | | |
| | | | | |
| | | | | |
Other adjustments, net | (100) | | | (192) | | | |
Changes in assets and liabilities, net of effects of acquisitions and dispositions: | | | | | |
Accounts receivable | (50,669) | | | (102,411) | | | |
Other assets | (6,068) | | | (10,014) | | | |
Accounts payable and other liabilities | 13,450 | | | 26,692 | | | |
Operating lease liabilities | (17,375) | | | (13,229) | | | |
Income taxes payable and receivable | 4,856 | | | 2,014 | | | |
Deferred revenue | 4,220 | | | 1,597 | | | |
Net cash provided by operating activities | 88,798 | | | 11,358 | | | |
| | | | | |
Cash flows from investing activities: | | | | | |
| | | | | |
Capital expenditures | (36,105) | | | (95,521) | | | |
Purchases of marketable debt securities | (12,362) | | | — | | | |
Proceeds from maturities of marketable debt securities | 12,500 | | | — | | | |
| | | | | |
Proceeds from sales of fixed assets | 336 | | | 224 | | | |
| | | | | |
Net cash used in investing activities | (35,631) | | | (95,297) | | | |
| | | | | |
Cash flows from financing activities: | | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Purchases of treasury stock | (3,397) | | | (8,144) | | | |
| | | | | |
Withholding taxes paid on behalf of employees on net settled stock-based awards | (4,780) | | | (5,587) | | | |
| | | | | |
| | | | | |
Other, net | (57) | | | — | | | |
Net cash used in financing activities | (8,234) | | | (13,731) | | | |
| | | | | |
Total cash provided (used) | 44,933 | | | (97,670) | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
Effect of exchange rate changes on cash and cash equivalents and restricted cash | 127 | | | (2,079) | | | |
Net increase (decrease) in cash and cash equivalents and restricted cash | 45,060 | | | (99,749) | | | |
Cash and cash equivalents and restricted cash at beginning of period | 322,136 | | | 429,485 | | | |
Cash and cash equivalents and restricted cash at end of period | $ | 367,196 | | | $ | 329,736 | | | |
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1—THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Nature of Operations
Angi Inc. connects quality home service professionals with consumers across more than 500 different categories, from repairing and remodeling homes to cleaning and landscaping. Over 202,000Approximately 192,000 transacting service professionals actively sought consumer matches, completed jobs, or advertised work through Angi Inc. platforms during the three months ended September 30, 2023.March 31, 2024. Additionally, consumers turned to at least one of our brandsbusinesses to find a service professional for approximately 2521 million projects during the twelve months ended September 30, 2023.March 31, 2024.
The Company has fourthree operating segments: (i) Ads and Leads; (ii) Services; (iii) Roofing; and (iv)(iii) International (consisting of businesses in Europe and Canada) and operates under multiple brands including Angi, HomeAdvisor, Handy, Total Home Roofing, and Angi Roofing.Handy.
Ads and Leads provides service professionals the capability to engage with potential customers, including quotequoting and invoicing services, and provides consumers with tools and resources to help them find local, pre-screened and customer-rated service professionals nationwide for home repair, maintenance and improvement projects. Services consumers can request household services directly through the Angi platform and Angi fulfills the request through the use of independently established home services providers engaged in a trade, occupation and/or business that customarily provides such services. The matching, and pre-priced booking services, and related tools and directories are provided to consumers free of charge. Roofing provides roof replacement and repair services through its wholly-owned subsidiary Angi Roofing, LLC.
As used herein, “Angi,” the “Company,” “we,” “our,” “us,” and similar terms refer to Angi Inc. and its subsidiaries (unless the context requires otherwise).
At September 30, 2023,March 31, 2024, IAC Inc. (“IAC”) owned 83.8%84.3% and 98.1%98.2% of the economic and voting interests, respectively, of the Company.
Total Home Roofing, LLC Sale
On November 1, 2023, Angi Inc. completed the sale of 100% of its wholly-owned subsidiary, Total Home Roofing, LLC (“THR,” which comprised its Roofing segment), and has reflected it as a discontinued operation in its financial statements. See “Note 11—Discontinued Operations” for additional details. The financial information for prior periods has been recast to conform to this presentation. Basis of Presentation and Consolidation
The Company prepares its consolidated financial statements (referred to herein as “financial statements”) in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”). The financial statements include the accounts of the Company, all entities that are wholly-owned by the Company and all entities in which the Company has a controlling financial interest. All intercompany transactions and balances between and among the Company and its subsidiaries have been eliminated. See “Note 10—Related Party Transactions with IAC” for information on transactions between Angi and IAC. The Company is included within IAC’s tax group for purposes of federal and consolidated state income tax return filings. For the purpose of these financial statements, income taxes have been computed on an as if standalone, separate return basis. Any differences between taxes currently payable to or receivable from IAC under the tax sharing agreement between the Company and IAC and the current tax provision or benefit computed on an as if standalone, separate return basis for GAAP are reflected as adjustments to additional paid-in capital and as financing activities within the statement of cash flows.
In management's opinion, the unaudited interim financial statements have been prepared onin accordance with GAAP for interim financial information and with the same basis asrules and regulations of the Securities and Exchange Commission ("SEC"). Accordingly, they do not include all of the information and notes required by GAAP for complete annual financial statements. In the opinion of management, the unaudited interim financial statements and reflectinclude all normal recurring adjustments considered necessary for thea fair presentation of the Company's consolidated financial position, consolidated results of operations and consolidated cash flows for the periods presented.presentation. Interim results are not necessarily indicative of the results that may be expected for the full year. The accompanying unaudited interim financial statements should be read in conjunction with the annual audited financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2022.
Segment Changes
In the fourth quarter of 2022, the Company’s segment presentation was changed and our financial information for all prior periods, including the three and nine months ended September 30, 2022, has been recast to reflect the following operating segments: Ads and Leads, Services, Roofing, and International.
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
2023.
Accounting Estimates
Management of the Company is required to make certain estimates, judgments, and assumptions during the preparation of its financial statements in accordance with GAAP. These estimates, judgments, and assumptions impact the reported amounts of assets, liabilities, revenue, and expenses and the related disclosure of assets and liabilities. Actual results could differ from these estimates.
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
On an ongoing basis, the Company evaluates its estimates and judgments, including those related to: the fair values of cash equivalents and marketable debt securities;equivalents; the carrying value of accounts receivable, including the determination of the allowance for credit losses; the determination of the customer relationship period for certain costs to obtain a contract with a customer; the recoverability of right-of-useall long-lived assets, (“ROU assets”); the useful lives and recoverability of definite-lived intangible assets and capitalized software, leasehold improvements, and equipment; the recoverability ofincluding goodwill and indefinite-lived intangible assets; contingencies; unrecognized tax benefits; the liability for potential refunds and customer credits; the valuation allowance for deferred income tax assets; and the fair value of and forfeiture rates for stock-based awards, among others. The Company bases its estimates and judgments on historical experience, its forecasts and budgets, and other factors that the Company considers relevant.
General Revenue Recognition
The Company accounts for a contract with a customer when it has approval and commitment from all authorized parties, the rights of the parties and payment terms are identified, the contract has commercial substance and collectability of consideration is probable. Revenue is recognized when control of the promised goodsservices or servicesgoods is transferred to the Company’s customers and in thean amount that reflects the consideration the Company expects to be entitled to in exchange for those goodsservices or services.
From January 1, 2020 through December 31, 2022, Services recorded revenue on a gross basis. Effective January 1, 2023, we modified the Services terms and conditions so that the service professional, rather than Angi Inc., has the contractual relationship with the consumer to deliver the service and our performance obligation to the consumer is to connect them with the service professional. This change in contractual terms requires revenue be reported as the net amount of what is received from the consumer after deducting the amounts owed to the service professional providing the service effective for all arrangements entered into after December 31, 2022. There is no impact to operating loss or Adjusted EBITDA from this change in revenue recognition. For the three and nine months ended September 30, 2022, if Services revenue were recorded on a net basis, revenue would have been reduced by $64.8 million and $187.5 million, respectively.goods.
Deferred Revenue
Deferred revenue consists of payments that are received or are contractually due in advance of the Company’s performance obligation. The Company’s deferred revenue is reported on a contract-by-contract basis at the end of each reporting period. The Company classifies deferred revenue as current when the remaining term or expected completion of its performance obligation is one year or less. At December 31, 2022,2023, the current and non-current deferred revenue balances were $50.9$49.9 million and $0.1 million, respectively, and during the ninethree months ended September 30, 2023,March 31, 2024, the Company recognized $47.0$32.6 million of revenue that was included in the deferred revenue balance as of December 31, 2022.2023. At December 31, 2021,2022, the current and non-current deferred revenue balances were $53.8$50.1 million and $0.1 million, respectively, and during the ninethree months ended September 30, 2022,March 31, 2023, the Company recognized $51.9$31.9 million of revenue that was included in the deferred revenue balance as of December 31, 2021.2022.
The current and non-current deferred revenue balances at September 30, 2023March 31, 2024 are $55.2$50.1 million and less than $0.1 million, respectively. Non-current deferred revenue is included in “Other long-term liabilities” in the accompanying consolidated balance sheet.
Practical Expedients and Exemptions
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
For contracts that have an original duration of one year or less, the Company uses the practical expedient available under Accounting Standards Codification (“ASC”) Topic 606 (“ASC 606,606”), Revenue from Contracts with Customers, applicable to such contracts and does not consider the time value of money.
In addition, as permitted under the practical expedient available under ASC 606, the Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, (ii) contracts with variable consideration that is allocated entirely to unsatisfied performance obligations or to a wholly unsatisfied promise accounted for under the series guidance, and (iii) contracts for which the Company recognizes revenue at the amount which the Companyit has the right to invoice for services performed.
The Company also applies the practical expedient to expense sales commissions as incurred where the anticipated customer relationship period is one year or less.
Recent Accounting Pronouncements
Recent Accounting Pronouncements Adopted by the Company
There are no recently issued accounting pronouncements adopted by the Company during the three months ended March 31, 2024.
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Recent Accounting Pronouncements Not Yet Adopted by the Company
Accounting Standards Update (“ASU”) 2023-07— Segment Reporting (Topic 280)— Improvements to Reportable Segment Disclosures
In November 2023, the FASB issued ASU No. 2023-07, which is intended to provide users of financial statements with more decision-useful information about reportable segments of a public business entity, primarily through enhanced disclosures of significant segment expenses. This ASU requires annual and interim disclosures of significant expenses that are regularly provided to the chief operating decision maker ("CODM") and included within each reported measure of segment profit or loss and an amount and description of its composition of other segment items. The provisions of this ASU also require entities to include all annual disclosures required by Topic 280 in the interim periods and permits entities to include multiple measures of a segment's profit or loss if such measures are used by the CODM to assess segment performance and determine allocation of resources, provided that at least one of those measures is determined in a way that is consistent with the measurement principles under GAAP. The amendments in ASU 2023-07 apply retrospectively and are effective for fiscal years beginning after December 15, 2023 and interim periods after December 15, 2024. Early adoption is permitted. The Company does not plan to early adopt and is currently assessing the impact of adopting the updated guidance on the financial statements.
ASU 2023-09— Income Taxes (Topic 740)— Improvements to Income Tax Disclosures
In December 2023, the FASB issued ASU No. 2023-09, which establishes required categories and a quantitative threshold to the annual tabular rate reconciliation disclosure and disaggregated jurisdictional disclosures of income taxes paid. The guidance’s annual requirements are effective for the Company beginning with the December 31, 2025 reporting period. Early adoption is permitted and prospective disclosure should be applied, however, retrospective disclosure is permitted. The Company is currently assessing the pronouncement and its impact on its income tax disclosures, but it does not impact the Company’s results of operations, financial condition, or cash flows.
NOTE 2—FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
Fair Value Measurements
The Company categorizes its financial instruments measured at fair value into a fair value hierarchy that prioritizes the inputs used in pricing the asset or liability. The three levels of the fair value hierarchy are:
•Level 1: Observable inputs obtained from independent sources, such as quoted market prices for identical assets and liabilities in active markets.
•Level 2: Other inputs, which are observable directly or indirectly, such as quoted market prices for similar assets or liabilities in active markets, quoted market prices for identical or similar assets or liabilities in markets that are not active and inputs that are derived principally from or corroborated by observable market data. The fair values of the Company’s Level 2 financial assets are primarily obtained from observable market prices for identical underlying securities that may not be actively traded. Certain of these securities may have different market prices from multiple market data sources, in which case an average market price is used.
•Level 3: Unobservable inputs for which there is little or no market data and require the Company to develop its own assumptions, based on the best information available in the circumstances, about the assumptions market participants would use in pricing the assets or liabilities.
The Company’s non-financial assets, such as goodwill, intangible assets, ROU assets, capitalized software, leasehold improvements and equipment are adjusted to fair value only when an impairment is recognized. Such fair value measurements are based predominantly on Level 3 inputs.
Recent Accounting Pronouncements
There are no recently issued accounting pronouncements adopted or that have not yet been adopted by the Company that are expected to have a material effect on the results of operations, financial condition, or cash flows of the Company.
Reclassifications
Certain prior year amounts have been reclassified to conform to the current year presentation.
NOTE 2—FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
Fair Value Measurements
Instruments measured at fair value on a recurring basis
Cash and cash equivalents are measured at fair value and classified within Level 1 and Level 2 in the fair value hierarchy, because we use quoted prices for identical assets in active markets.
The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis:
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
| | September 30, 2023 |
| Quoted Market Prices for Identical Assets in Active Markets (Level 1) | | Significant Other Observable Inputs (Level 2) | | Significant Unobservable Inputs (Level 3) | | Total Fair Value Measurements |
| (In thousands) |
| March 31, 2024 | | | March 31, 2024 |
| Level 1 | | | Level 1 | | Level 2 | | Level 3 | | Total Fair Value Measurements |
| (In thousands) | | | (In thousands) |
Assets: | Assets: | |
Cash equivalents: | Cash equivalents: | |
Cash equivalents: | |
Cash equivalents: | |
Money market funds | |
Money market funds | |
Money market funds | Money market funds | $ | 196,679 | | | $ | — | | | $ | — | | | $ | 196,679 | |
Treasury discount notes | Treasury discount notes | — | | | 99,522 | | | — | | | 99,522 | |
| Total | Total | $ | 196,679 | | | $ | 99,522 | | | $ | — | | | $ | 296,201 | |
| Total | |
| Total | |
| | December 31, 2022 |
| Quoted Market Prices for Identical Assets in Active Markets (Level 1) | | Significant Other Observable Inputs (Level 2) | | Significant Unobservable Inputs (Level 3) | | Total Fair Value Measurements |
| (In thousands) |
| December 31, 2023 | | | December 31, 2023 |
| Level 1 | | | Level 1 | | Level 2 | | Level 3 | | Total Fair Value Measurements |
| (In thousands) | | | (In thousands) |
Assets: | Assets: | |
Cash equivalents: | Cash equivalents: | |
Cash equivalents: | |
Cash equivalents: | |
Money market funds | |
Money market funds | |
Money market funds | Money market funds | $ | 189,000 | | | $ | — | | | $ | — | | | $ | 189,000 | |
Treasury discount notes | Treasury discount notes | — | | | 24,961 | | | — | | | 24,961 | |
| Total | Total | $ | 189,000 | | | $ | 24,961 | | | $ | — | | | $ | 213,961 | |
| Total | |
| Total | |
Financial instruments measured at fair value only for disclosure purposes
The total fair value of the outstanding long-term debt, including the current portion, is estimated using observable market prices or indices for similar liabilities, which are Level 2 inputs, and was approximately $390.0$432.5 million and $368.8$418.1 million at September 30, 2023March 31, 2024 and December 31, 2022,2023, respectively.
NOTE 3—LONG-TERM DEBT
Long-term debt consists of:
| | | September 30, 2023 | | December 31, 2022 | | March 31, 2024 | | December 31, 2023 |
| | (In thousands) | | (In thousands) |
3.875% ANGI Group Senior Notes due August 15, 2028 (“ANGI Group Senior Notes”); interest payable each February 15 and August 15 | 3.875% ANGI Group Senior Notes due August 15, 2028 (“ANGI Group Senior Notes”); interest payable each February 15 and August 15 | $ | 500,000 | | | $ | 500,000 | |
| Less: unamortized debt issuance costs | Less: unamortized debt issuance costs | 4,147 | | | 4,716 | |
| Less: unamortized debt issuance costs | |
| Less: unamortized debt issuance costs | |
Total long-term debt, net | Total long-term debt, net | $ | 495,853 | | | $ | 495,284 | |
ANGI Group, LLC (“ANGI Group”), a direct wholly-owned subsidiary of Angi Inc., issued the ANGI Group Senior Notes on August 20, 2020. These notes may be redeemed at the redemption prices, plus accrued and unpaid interest thereon, if any, as set forth in the indenture governing the notes.
The indenture governing the ANGI Group Senior Notes contains a covenant that would limit ANGI Group’s ability to incur liens for borrowed money in the event a default has occurred or ANGI Group’s secured leverage ratio exceeds 3.75 to 1.0, provided that ANGI Group is permitted to incur such liens under certain permitted credit facilities indebtedness notwithstanding the ratio, all as defined in the indenture. At September 30, 2023,March 31, 2024, there were no limitations pursuant thereto.
NOTE 4—ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) INCOME
The following table presents the components of accumulated other comprehensive income (loss), which exclusively consists of foreign currency translation adjustment for the three months ended March 31, 2024:
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
The following tables present the components of accumulated other comprehensive (loss) income. | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 |
| Foreign Currency Translation Adjustment | | Foreign Currency Translation Adjustment | | Unrealized Gains on Available-For-Sale Debt Securities | | Accumulated Other Comprehensive Loss |
| (In thousands) |
Balance at January 1 | $ | 1,187 | | | $ | (1,172) | | | $ | — | | | $ | (1,172) | |
Other comprehensive (loss) income | (745) | | | 459 | | | 2 | | 461 | |
Balance at March 31 | $ | 442 | | | $ | (713) | | | $ | 2 | | | $ | (711) | |
There were no items reclassified out of accumulated other comprehensive income (loss) income into earnings during both the three months ending March 31, 2024 and nine months ended September 30, 2023 and 2022.
| | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, |
| 2023 | | 2022 |
| Foreign Currency Translation Adjustment | | | | | | Foreign Currency Translation Adjustment | | |
| (In thousands) |
Balance at July 1 | $ | 1,122 | | | | | | | $ | (393) | | | |
Other comprehensive loss | (2,059) | | | | | | | (4,819) | | | |
Balance at September 30 | $ | (937) | | | | | | | $ | (5,212) | | | |
| | | | | | | | | | | | | | | | | |
| Nine Months Ended September 30, |
| 2023 | | 2022 |
| Foreign Currency Translation Adjustment | | | | | | Foreign Currency Translation Adjustment | | |
| (In thousands) |
Balance at January 1 | $ | (1,172) | | | | | | | $ | 3,309 | | | |
Other comprehensive income (loss) | 235 | | | | | | | (8,521) | | | |
Balance at September 30 | $ | (937) | | | | | | | $ | (5,212) | | | |
2023. At September 30, 2023 and 2022March 31, 2024, there was no tax benefit or provision on the accumulated other comprehensive loss. The income tax provision related to net unrealized gains on available-for-sale marketable debt securities was not material at March 31, 2023.
NOTE 5—SEGMENT INFORMATION
The Company hasOur reportable segments currently consist of Ads and Leads, Services, and International. Our CODM regularly reviews certain financial information by operating segment to determine allocation of resources and assess its performance. Segment profitability is determined its operating segmentsby and presented on an Adjusted EBITDA basis consistent with how the chief operating decision maker views the businesses. Additionally, the Company considers how theCODM’s view of profitability of its businesses, which excludes certain expenses that are organized as to segment management and the focus of the businessesrequired in accordance with regards to the types of services or products offered or the target market.GAAP.
The following table presents revenue by reportable segment:
| | Three Months Ended September 30, | | Nine Months Ended September 30, | |
| 2023 | | 2022 | | 2023 | | 2022 | |
| (In thousands) |
| | | Three Months Ended March 31, | |
| | | Three Months Ended March 31, | |
| | | Three Months Ended March 31, | |
| | | | | 2024 | | | | | | | 2024 | | 2023 |
| | | | | (In thousands) | | | | | | | (In thousands) |
Revenue: | Revenue: | | |
Domestic | Domestic | | |
Domestic | |
Domestic | |
Ads and Leads | |
Ads and Leads | |
Ads and Leads | Ads and Leads | $ | 291,993 | | | $ | 345,529 | | | $ | 877,986 | | | $ | 982,137 | | |
Services | Services | 29,964 | | | 105,892 | | | 91,890 | | | 290,574 | | |
Roofing | 21,400 | | | 25,993 | | | 84,254 | | | 105,330 | | |
Intersegment eliminations(a) | (794) | | | (2,825) | | | (3,257) | | | (6,452) | | |
Total Domestic | Total Domestic | 342,563 | | | 474,589 | | | 1,050,873 | | | 1,371,589 | | |
International | International | 29,274 | | | 23,447 | | | 88,439 | | | 78,388 | | |
Total revenue | $ | 371,837 | | | $ | 498,036 | | | $ | 1,139,312 | | | $ | 1,449,977 | | |
Total | |
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
(a)Intersegment eliminations related to Ads and Leads revenue earned from sales to Roofing.
The following table presents the revenue of the Company’s reportable segments disaggregated by type of service:
| | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2024 | | 2023 | | | | | | |
| (In thousands) |
Domestic | | | | | | | | | |
Ads and Leads: | | | | | | | | | |
Consumer connection revenue | $ | 160,531 | | | $ | 212,935 | | | | | | | |
Advertising revenue | 77,137 | | | 67,181 | | | | | | | |
Membership subscription revenue | 11,778 | | | 13,199 | | | | | | | |
Other revenue | 139 | | | 191 | | | | | | | |
Total Ads and Leads revenue | 249,585 | | | 293,506 | | | | | | | |
Services revenue | 20,451 | | | 32,059 | | | | | | | |
Total Domestic revenue | 270,036 | | | 325,565 | | | | | | | |
International | | | | | | | | | |
Consumer connection revenue | 29,669 | | | 24,745 | | | | | | | |
Service professional membership subscription revenue | 5,382 | | | 5,058 | | | | | | | |
Advertising and other revenue | 303 | | | 129 | | | | | | | |
Total International revenue | 35,354 | | | 29,932 | | | | | | | |
Total revenue | $ | 305,390 | | | $ | 355,497 | | | | | | | |
Revenue by geography is based on where the customer is located. Geographic information about revenue and long-lived assets is presented below:
| | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2024 | | 2023 | | | | | | |
| (In thousands) |
Revenue | | | | | | | | | |
United States | $ | 269,872 | | | $ | 325,565 | | | | | | | |
All other countries | 35,518 | | | 29,932 | | | | | | | |
Total | $ | 305,390 | | | $ | 355,497 | | | | | | | |
| | | | | | | | | | | |
| March 31, 2024 | | December 31, 2023 |
| (In thousands) |
Long-lived assets (excluding goodwill and intangible assets): | | | |
United States | $ | 132,462 | | | $ | 145,710 | |
All other countries | 8,554 | | | 9,788 | |
Total | $ | 141,016 | | | $ | 155,498 | |
The following tables present operating income (loss) and Adjusted EBITDA by reportable segment:
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, | | |
| 2023 | | 2022 | | 2023 | | 2022 | | | | | | |
| (In thousands) |
Domestic: | | | | | | | | | | | | | |
Ads and Leads: | | | | | | | | | | | | | |
Consumer connection revenue | $ | 203,579 | | | $ | 262,934 | | | $ | 625,527 | | | $ | 738,177 | | | | | | | |
Advertising revenue | 75,074 | | | 67,165 | | | 212,302 | | | 196,256 | | | | | | | |
Membership subscription revenue | 13,167 | | | 14,795 | | | 39,597 | | | 46,586 | | | | | | | |
Other revenue | 173 | | | 635 | | | 560 | | | 1,118 | | | | | | | |
Total Ads and Leads revenue | 291,993 | | | 345,529 | | | 877,986 | | | 982,137 | | | | | | | |
Services revenue | 29,964 | | | 105,892 | | | 91,890 | | | 290,574 | | | | | | | |
Roofing revenue | 21,400 | | | 25,993 | | | 84,254 | | | 105,330 | | | | | | | |
Intersegment eliminations(a) | (794) | | | (2,825) | | | (3,257) | | | (6,452) | | | | | | | |
Total Domestic | 342,563 | | | 474,589 | | | 1,050,873 | | | 1,371,589 | | | | | | | |
International: | | | | | | | | | | | | | |
Consumer connection revenue | 23,144 | | | 15,567 | | | 71,260 | | | 54,311 | | | | | | | |
Service professional membership subscription revenue | 6,023 | | | 7,597 | | | 16,834 | | | 23,211 | | | | | | | |
Advertising and other revenue | 107 | | | 283 | | | 345 | | | 866 | | | | | | | |
Total International | 29,274 | | | 23,447 | | | 88,439 | | | 78,388 | | | | | | | |
Total revenue | $ | 371,837 | | | $ | 498,036 | | | $ | 1,139,312 | | | $ | 1,449,977 | | | | | | | |
________________________ | | | | | | | | | | | | | | | |
| | | Three Months Ended March 31, |
| | | | | 2024 | | 2023 |
| | | | | (In thousands) |
Operating income (loss): | | | | | | | |
Ads and Leads | | | | | $ | 19,821 | | | $ | 13,480 | |
Services | | | | | (7,501) | | | (12,452) | |
Corporate | | | | | (15,117) | | | (14,939) | |
International | | | | | 5,513 | | | 3,030 | |
Total | | | | | $ | 2,716 | | | $ | (10,881) | |
(a)Intersegment eliminations related to Ads and Leads revenue earned from sales to Roofing.
Geographic information about revenue and long-lived assets is presented below.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, | | |
| 2023 | | 2022 | | 2023 | | 2022 | | | | | | |
| (In thousands) |
Revenue: | | | | | | | | | | | | | |
United States | $ | 342,342 | | | $ | 473,835 | | | $ | 1,050,186 | | | $ | 1,369,392 | | | | | | | |
All other countries | 29,495 | | | 24,201 | | | 89,126 | | | 80,585 | | | | | | | |
Total | $ | 371,837 | | | $ | 498,036 | | | $ | 1,139,312 | | | $ | 1,449,977 | | | | | | | |
| | | | | | | | | | | |
| September 30, 2023 | | December 31, 2022 |
| (In thousands) |
Long-lived assets (excluding goodwill, intangible assets, and ROU assets): | | | |
United States | $ | 116,942 | | | $ | 147,322 | |
All other countries | 4,302 | | | 6,533 | |
Total | $ | 121,244 | | | $ | 153,855 | |
The following tables present operating income (loss) and Adjusted EBITDA by reportable segment:
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, | | |
| 2023 | | 2022 | | 2023 | | 2022 | | | | | | |
| (In thousands) |
Operating income (loss): | | | | | | | | | | | | | |
Ads and Leads | $ | 8,115 | | | $ | 22,754 | | | $ | 26,386 | | | $ | 61,532 | | | | | | | |
Services | (3,887) | | | (10,780) | | | (21,514) | | | (57,581) | | | | | | | |
Roofing | (2,246) | | | (8,545) | | | (3,137) | | | (18,484) | | | | | | | |
Corporate | (14,854) | | | (15,542) | | | (46,361) | | | (46,655) | | | | | | | |
International | 2,764 | | | 1,055 | | | 7,365 | | | (4,713) | | | | | | | |
Total | $ | (10,108) | | | $ | (11,058) | | | $ | (37,261) | | | $ | (65,901) | | | | | | | |
| | Three Months Ended September 30, | | Nine Months Ended September 30, | |
| 2023 | | 2022 | | 2023 | | 2022 | |
| (In thousands) |
| | | Three Months Ended March 31, | |
| | | Three Months Ended March 31, | |
| | | Three Months Ended March 31, | |
| | | | | 2024 | | | | | | | 2024 | | 2023 |
| | | | | (In thousands) | | | | | | | (In thousands) |
Adjusted EBITDA(b): | Adjusted EBITDA(b): | | |
Ads and Leads | Ads and Leads | $ | 32,198 | | | $ | 43,344 | | | $ | 100,204 | | | $ | 119,833 | | |
Ads and Leads | |
Ads and Leads | |
Services | Services | $ | 3,534 | | | $ | (1,942) | | | $ | 3,066 | | | $ | (34,422) | | |
Roofing | $ | (1,983) | | | $ | (7,871) | | | $ | (2,456) | | | $ | (15,987) | | |
Corporate | Corporate | $ | (11,933) | | | $ | (12,550) | | | $ | (37,396) | | | $ | (38,102) | | |
International | International | $ | 4,046 | | | $ | 1,901 | | | $ | 11,237 | | | $ | (1,920) | | |
Total | |
(b) The Company’s primary financial measure and GAAP segment measure is Adjusted EBITDA, which is defined as operating income (loss) excluding: (1) stock-based compensation expense; (2) depreciation; and (3) acquisition-related items consisting of amortization of intangible assets and impairments of goodwill and intangible assets, if applicable.
We consider operating income (loss) to be the financial measure calculated and presented in accordance with GAAP that is most directly comparable to our segment reporting performance measure, Adjusted EBITDA. The following tables reconcile operating income (loss) for the Company’s reportable segments and net loss attributable to Angi Inc. shareholders to Adjusted EBITDA:
| | Three Months Ended September 30, 2023 |
| Operating Income (Loss) | | Stock-Based Compensation Expense | | Depreciation | | Amortization of Intangibles | | Adjusted EBITDA(b) |
| (In thousands) |
| Three Months Ended March 31, 2024 | |
| Three Months Ended March 31, 2024 | |
| Three Months Ended March 31, 2024 | |
| Operating Income (Loss) | | | Operating Income (Loss) | | Stock-Based Compensation Expense | | Depreciation | | | | Adjusted EBITDA(b) |
| (In thousands) | | | (In thousands) |
Ads and Leads | Ads and Leads | $ | 8,115 | | | $ | 6,082 | | | $ | 15,368 | | | $ | 2,633 | | | $ | 32,198 | |
Services | Services | (3,887) | | | $ | 1,096 | | | $ | 6,325 | | | $ | — | | | $ | 3,534 | |
Roofing | (2,246) | | | $ | 160 | | | $ | 103 | | | $ | — | | | $ | (1,983) | |
Corporate | Corporate | (14,854) | | | $ | 2,921 | | | $ | — | | | $ | — | | | $ | (11,933) | |
International | International | 2,764 | | | $ | 482 | | | $ | 800 | | | $ | — | | | $ | 4,046 | |
Total | Total | (10,108) | | | | | | | | | |
Interest expense | Interest expense | (5,037) | | |
Other income, net | Other income, net | 3,891 | | |
Loss before income taxes | (11,254) | | |
Income tax benefit | 5,967 | | |
Other income, net | |
Other income, net | |
Earnings before income taxes | |
Earnings before income taxes | |
Earnings before income taxes | |
Income tax provision | |
Income tax provision | |
Income tax provision | |
| Net loss | |
| Net loss | |
| Net loss | Net loss | (5,287) | | |
Net earnings attributable to noncontrolling interests | Net earnings attributable to noncontrolling interests | (69) | | |
Net earnings attributable to noncontrolling interests | |
Net earnings attributable to noncontrolling interests | |
Net loss attributable to Angi Inc. shareholders | Net loss attributable to Angi Inc. shareholders | $ | (5,356) | | |
Net loss attributable to Angi Inc. shareholders | |
Net loss attributable to Angi Inc. shareholders | |
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, 2022 |
| Operating Income (Loss) | | Stock-Based Compensation Expense | | Depreciation | | Amortization of Intangibles | | Adjusted EBITDA(b) |
| (In thousands) |
Ads and Leads | $ | 22,754 | | | $ | 4,979 | | | $ | 12,948 | | | $ | 2,663 | | | $ | 43,344 | |
Services | (10,780) | | | $ | 4,015 | | | $ | 3,848 | | | $ | 975 | | | $ | (1,942) | |
Roofing | (8,545) | | | $ | 195 | | | $ | 312 | | | $ | 167 | | | $ | (7,871) | |
Corporate | (15,542) | | | $ | 2,992 | | | $ | — | | | $ | — | | | $ | (12,550) | |
International | 1,055 | | | $ | 195 | | | $ | 651 | | | $ | — | | | $ | 1,901 | |
Total | (11,058) | | | | | | | | | |
Interest expense | (5,030) | | | | | | | | | |
Other expense, net | (2,296) | | | | | | | | | |
Loss before income taxes | (18,384) | | | | | | | | | |
Income tax benefit | 945 | | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
Net loss | (17,439) | | | | | | | | | |
Net earnings attributable to noncontrolling interests | (40) | | | | | | | | | |
Net loss attributable to Angi Inc. shareholders | $ | (17,479) | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Nine Months Ended September 30, 2023 |
| Operating Income (Loss) | | Stock-Based Compensation Expense | | Depreciation | | Amortization of Intangibles | | | | Adjusted EBITDA(b) |
| (In thousands) |
Ads and Leads | $ | 26,386 | | | $ | 16,880 | | | $ | 48,980 | | | $ | 7,958 | | | | | $ | 100,204 | |
Services | (21,514) | | | $ | 6,497 | | | $ | 18,083 | | | $ | — | | | | | $ | 3,066 | |
Roofing | (3,137) | | | $ | 158 | | | $ | 523 | | | $ | — | | | | | $ | (2,456) | |
Corporate | (46,361) | | | $ | 8,965 | | | $ | — | | | $ | — | | | | | $ | (37,396) | |
International | 7,365 | | | $ | 1,248 | | | $ | 2,624 | | | $ | — | | | | | $ | 11,237 | |
Operating loss | (37,261) | | | | | | | | | | | |
Interest expense | (15,100) | | | | | | | | | | | |
Other income, net | 12,890 | | | | | | | | | | | |
Loss before income taxes | (39,471) | | | | | | | | | | | |
Income tax benefit | 4,705 | | | | | | | | | | | |
| | | | | | | | | | | |
| | | | | | | | | | | |
Net loss | (34,766) | | | | | | | | | | | |
Net earnings attributable to noncontrolling interests | (614) | | | | | | | | | | | |
Net loss attributable to Angi Inc. shareholders | $ | (35,380) | | | | | | | | | | | |
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
| | Nine Months Ended September 30, 2022 |
| Operating Income (Loss) | | Stock-Based Compensation Expense | | Depreciation | | | Amortization of Intangibles | | Adjusted EBITDA(b) |
| (In thousands) |
| Three Months Ended March 31, 2023 | | | Three Months Ended March 31, 2023 |
| Operating Income (Loss) | | | Operating Income (Loss) | | Stock-Based Compensation Expense | | Depreciation | | Amortization of Intangibles | | Adjusted EBITDA(b) |
| (In thousands) | | | (In thousands) |
Ads and Leads | Ads and Leads | $ | 61,532 | | | $ | 15,303 | | | $ | 35,010 | | | | $ | 7,988 | | | $ | 119,833 | |
Services | Services | (57,581) | | | $ | 13,068 | | | $ | 7,166 | | | | $ | 2,925 | | | $ | (34,422) | |
Roofing | (18,484) | | | $ | 1,410 | | | $ | 587 | | | | $ | 500 | | | $ | (15,987) | |
Corporate | Corporate | (46,655) | | | $ | 8,553 | | | $ | — | | | | $ | — | | | $ | (38,102) | |
International | International | (4,713) | | | $ | 444 | | | $ | 2,349 | | | | $ | — | | | $ | (1,920) | |
Operating loss | (65,901) | | | | | | | | | | |
Total | |
Interest expense | Interest expense | (15,078) | | | | |
Other expense, net | (4,437) | | | | |
Loss before income taxes | (85,416) | | | | |
Income tax benefit | 10,693 | | | | |
| Other income, net | |
Other income, net | |
Other income, net | |
Loss from continuing operations before income taxes | |
Loss from continuing operations before income taxes | |
Loss from continuing operations before income taxes | |
Income tax provision | |
Income tax provision | |
Income tax provision | |
Net loss from continuing operations | |
Net loss from continuing operations | |
Net loss from continuing operations | |
Loss from discontinued operations, net of tax | |
Loss from discontinued operations, net of tax | |
Loss from discontinued operations, net of tax | |
Net loss | |
Net loss | |
Net loss | Net loss | (74,723) | | | | |
Net earnings attributable to noncontrolling interests | Net earnings attributable to noncontrolling interests | (379) | | | | |
Net earnings attributable to noncontrolling interests | |
Net earnings attributable to noncontrolling interests | |
Net loss attributable to Angi Inc. shareholders | Net loss attributable to Angi Inc. shareholders | $ | (75,102) | | | | |
Net loss attributable to Angi Inc. shareholders | |
Net loss attributable to Angi Inc. shareholders | |
NOTE 6—INCOME TAXES
The Company is included within IAC’s tax group for purposes of federal and consolidated state income tax return filings. In all periods presented, the income tax benefitprovision and/or provisionbenefit has been computed for the Company on an as if standalone, separate return basis and payments to and refunds from IAC for the Company’s share of IAC’s consolidated federal and state tax return liabilities/receivables calculated on this basis have been reflected within cash flows from operating activities in the accompanying consolidated statement of cash flows. The tax sharing agreement between the Company and IAC governs the parties’ respective rights, responsibilities and obligations with respect to tax matters, including responsibility for taxes attributable to the Company, entitlement to refunds, allocation of tax attributes and other matters and, therefore, ultimately governs the amount payable to or receivable from IAC with respect to income taxes. Any differences between taxes currently payable to or receivable from IAC under the tax sharing agreement and the current tax provision or benefit computed on an as if standalone, separate return basis for GAAP are reflected as adjustments to additional paid-in capital in the consolidated statement of shareholders’ equity and financing activities within the consolidated statement of cash flows.
At the end of each interim period, the Company estimates the annual expected effective income tax rate and applies that rate to its ordinary year-to-date earnings or loss. The income tax provision or benefit related to significant, unusual, or extraordinary items, if applicable, that will be separately reported or reported net of their related tax effects are individually computed and recognized in the interim period in which they occur. In addition, the effect of changes in enacted tax laws or rates, tax status, judgment on the realizability of a beginning-of-the-year deferred tax asset in future years or unrecognized tax benefits is recognized in the interim period in which the change occurs.
The computation of the annual expected effective income tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected pre-tax income (or loss) for the year, projections of the proportion of income (and/or loss) earned and taxed in foreign jurisdictions, permanent and temporary differences, and the likelihood of the realization of deferred tax assets generated in the current year. The accounting estimates used to compute the provision or benefit for income taxes may change as new events occur, more experience is acquired, additional information is obtained or the Company’s tax environment changes. To the extent that the expected annual effective income tax rate changes during a quarter, the effect of the change on prior quarters is included in income tax provision or benefit in the quarter in which the change occurs. Included in the income tax benefit for the three months ended September 30, 2023 was a benefit of $3.9 million due to a higher estimated annual effective tax rate from that applied to the second quarter’s year-to-date ordinary loss from
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
continuing operations. The higher estimated annual effective tax rate was primarily due to reduced foreign income subject to tax in the U.S. and reduced state taxes.
For the three months ended September 30, 2023,March 31, 2024, the Company recorded an income tax benefitprovision of $6.0$3.5 million which represents an effective income tax rate of 53%. The effective income tax rate is higher than the statutory rate of 21% due primarily to benefits related to a change in the annual expected effective income tax rate, research credits, and a reconciliationimpact of income tax provision accruals to tax returns, partially offset by tax shortfalls generated by the vesting for stock-based awards. For the nine months ended September 30, 2023, the Company recorded an income tax benefit of $4.7 million, which represents an effective income tax rate of 12%. The effective income tax rate is lower than the statutory rate of 21% due primarily to tax shortfalls generated by the vesting and exercise for stock-based awards and nondeductible stock-based compensation,unbenefited losses, partially offset by research credits. For the three and nine months ended September 30, 2022,March 31, 2023, the Company recorded an income tax benefitprovision of $0.9$1.9 million, and $10.7 million, which represents an effective income tax rate of 5% and 13%, respectively. For the three months ended September 30, 2022, the effective income tax rate is lower than the statutory rate of 21%despite a pre-tax loss, due primarily to tax shortfalls generated by the vesting and exercise for stock-based awards and provisions related to a change in the annual expected effective income tax rate. For the nine months ended September 30, 2022, the effective income tax rate is lower than the statutory rate of 21% due primarily to tax shortfalls generated by the vesting and exercise for stock-based awards and nondeductible stock-based compensation expense.and foreign income taxed at different rates, partially offset by research credits.
The Company recognizes interest and, if applicable, penalties related to unrecognized tax benefits in the income tax provision. Accruals for interest are not material and there are currently no accruals for penalties.
The Company’s income taxes are routinely under audit by federal, state, local and foreign authorities as a result of previously filed separate company and consolidated tax returns with IAC. These audits include questioning the timing and the amount of income and deductions and the allocation of income and deductions among various tax jurisdictions. On June 27, 2023 the Joint Committee of Taxation completed its review of the federal income tax returns for the years ended December 31, 2013 through 2019, which includes the operations of theThe Company and approved theis not currently under audit settlement previously agreed to withby the Internal Revenue Service. The statutes of limitations for the years 2013 through 2019 have been extended to December 31, 2023. Returns filed in various other jurisdictions are open to examination for various tax years beginning with 2013. Income taxes payable include unrecognized tax benefits considered sufficient to pay assessments that may result from the examination of prior year tax returns. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may not accurately anticipate actual outcomes and, therefore, may require periodic adjustment. Although management currently believes changes in unrecognized tax benefits from period to period and differences between amounts paid, if any, upon resolution of issues raised in audits and amounts previously provided will not have a material impact on the liquidity, results of operations, or financial condition of the Company, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future.
At September 30, 2023March 31, 2024 and December 31, 2022,2023, the Company has unrecognized tax benefits, including interest, of $7.4$8.5 million and $6.2$8.1 million, respectively; all of which are for tax positions included in IAC’s consolidated tax return filings. If unrecognized tax benefits at September 30, 2023March 31, 2024 are subsequently recognized, the income tax provision would be reduced by $7.0$8.0 million. The comparable amount as ofat December 31, 2022 is $5.82023 was $7.6 million. The Company believes that it is reasonably possible that its unrecognized tax benefits could decrease by $0.2 million by September 30, 2024March 31, 2025 due to settlements; $0.1 millionsettlements, all of which would reduce the income tax provision.
The Company regularly assesses the realizability of deferred tax assets considering all available evidence including, to the extent applicable, the nature, frequency and severity of prior cumulative losses, forecasts of future taxable income, tax filing status, the duration of statutory carryforward periods, available tax planning and historical experience. At September 30, 2023,March 31, 2024, the Company has a U.S. gross deferred tax asset of $221.1$208.7 million that the Company expects to fully utilize on a more likely than not basis. Of this amount, $24.1$22.6 million will be utilized upon the future reversal of deferred tax liabilities and the remaining net deferred tax asset of $197.0$186.1 million will be utilized based on forecasts of future taxable income. The Company’sCompany's most significant net deferred tax asset that could expire relates to U.S. federal net operating loss (“NOL”("NOL") carryforwards of $108.1$101.2 million. The Company expects to generate sufficient future taxable income of at least $514.7$482.1 million prior to the expiration of these NOLs, the majority of which expire between 20322033 and 2037, and a portion of which never expire, to fully realize this deferred tax asset.
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 7—LOSS PER SHARE
The following table sets forth the computation of basic and diluted loss per share attributable to Angi Inc. Class A and Class B Common Stock shareholders:
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, |
| 2023 | | 2022 |
| Basic | | Diluted | | Basic | | Diluted |
| (In thousands, except per share data) |
Numerator: | | | | | | | |
Net loss | $ | (5,287) | | | $ | (5,287) | | | $ | (17,439) | | | $ | (17,439) | |
Net loss attributable to noncontrolling interests | (69) | | | (69) | | | (40) | | | (40) | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
Net loss attributable to Angi Inc. Class A and Class B Common Stock shareholders | $ | (5,356) | | | $ | (5,356) | | | $ | (17,479) | | | $ | (17,479) | |
| | | | | | | |
Denominator: | | | | | | | |
Weighted average basic Class A and Class B common stock shares outstanding | 506,332 | | | 506,332 | | | 503,202 | | | 503,202 | |
Dilutive securities (a) (b) | — | | | — | | | — | | | — | |
Denominator for loss per share—weighted average shares | 506,332 | | | 506,332 | | | 503,202 | | | 503,202 | |
| | | | | | | |
Loss per share attributable to Angi Inc. Class A and Class B Common Stock shareholders: | |
Loss per share | $ | (0.01) | | | $ | (0.01) | | | $ | (0.03) | | | $ | (0.03) | |
| | | | | | | |
| | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | |
| Nine Months Ended September 30, |
| 2023 | | 2022 |
| Basic | | Diluted | | Basic | | Diluted |
| (In thousands, except per share data) |
Numerator: | | | | | | | |
Net loss | $ | (34,766) | | | $ | (34,766) | | | $ | (74,723) | | | $ | (74,723) | |
Net loss attributable to noncontrolling interests | (614) | | | (614) | | | (379) | | | (379) | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
Net loss attributable to Angi Inc. Class A and Class B Common Stock shareholders | $ | (35,380) | | | $ | (35,380) | | | $ | (75,102) | | | $ | (75,102) | |
| | | | | | | |
Denominator: | | | | | | | |
Weighted average basic Class A and Class B common stock shares outstanding | 505,822 | | | 505,822 | | | 502,558 | | | 502,558 | |
Dilutive securities (a) (b) | — | | | — | | | — | | | — | |
Denominator for loss per share—weighted average shares | 505,822 | | | 505,822 | | | 502,558 | | | 502,558 | |
| | | | | | | |
Loss per share attributable to Angi Inc. Class A and Class B Common Stock shareholders: | |
Loss per share | $ | (0.07) | | | $ | (0.07) | | | $ | (0.15) | | | $ | (0.15) | |
| | | | | | | |
| | | | | | | |
________________________
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 |
| Basic | | Diluted | | Basic | | Diluted |
| (In thousands, except per share data) |
Numerator: | | | | | | | |
Net loss from continuing operations | $ | (1,317) | | | $ | (1,317) | | | $ | (13,987) | | | $ | (13,987) | |
Net earnings attributable to noncontrolling interests of continuing operations | (314) | | | (314) | | | (325) | | | (325) | |
Net loss attributable to Angi Inc. Class A and Class B Common Stock shareholders | (1,631) | | | (1,631) | | | (14,312) | | | (14,312) | |
Loss from discontinued operations | — | | | — | | | (1,013) | | | (1,013) | |
Net loss attributable to Angi Inc. Class A and Class B Common Stock shareholders | $ | (1,631) | | | $ | (1,631) | | | $ | (15,325) | | | $ | (15,325) | |
| | | | | | | |
Denominator: | | | | | | | |
Weighted average basic Class A and Class B common stock shares outstanding | 502,627 | | | 502,627 | | | 505,033 | | | 505,033 | |
Dilutive securities (a) (b) | — | | | — | | | — | | | — | |
Denominator for loss per share—weighted average shares | 502,627 | | | 502,627 | | | 505,033 | | | 505,033 | |
| | | | | | | |
Loss per share attributable to Angi Inc. Class A and Class B Common Stock shareholders: | |
Loss per share from continuing operations | $ | (0.00) | | | $ | (0.00) | | | $ | (0.03) | | | $ | (0.03) | |
Loss per share from discontinued operations, net of tax | — | | | — | | | (0.00) | | | (0.00) | |
Loss per share attributable to Angi Inc. Class A and Class B Common Stock shareholders | $ | (0.00) | | | $ | (0.00) | | | $ | (0.03) | | | $ | (0.03) | |
________________________
(a) If the effect is dilutive, weighted average common shares outstanding include the incremental shares that would be issued upon the assumed exercise of stock options and subsidiary denominated equity and vesting of restricted stock units (“RSUs”). For the three and nine months ended September 30,March 31, 2024 and 2023, 28.4 and 2022, 27.429.6 million, and 22.9 millionrespectively, of potentially dilutive securities respectively, were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive. Accordingly, the weighted average basic shares outstanding were used to compute all earningsloss per share amounts.
(b) Market-based awards (“MSUs”) and performance-based stock units (“PSUs”) are considered contingently issuable shares. Shares issuable upon exercise or vesting of market-based awardsMSUs and PSUs are included in the denominator for earnings per share if (i) the applicable market or performance condition(s) has been met and (ii) the inclusion of the market-based awardsMSUs and PSUs is dilutive for the respective reporting periods. For the three and nine months ended September 30,March 31, 2024 and 2023, and 2022, 0.60.4 million and 0.9 million underlying market-based awardsMSUs and PSUs, respectively, were excluded from the calculation of diluted earnings per share because the market or performance condition(s) had not been met.
NOTE 8—CONSOLIDATED FINANCIAL STATEMENT DETAILS
Cash and Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the accompanying balance sheet to the total amounts shown in the accompanying statement of cash flows:
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| September 30, 2023 | | December 31, 2022 | | September 30, 2022 | | December 31, 2021 | | | | |
| (In thousands) |
Cash and cash equivalents | $ | 366,825 | | | $ | 321,155 | | | $ | 328,795 | | | $ | 428,136 | | | | | |
Restricted cash included in other current assets | — | | | 107 | | | 101 | | | 156 | | | | | |
Restricted cash included in other non-current assets | 371 | | | 874 | | | 840 | | | 1,193 | | | | | |
Total cash and cash equivalents, and restricted cash as shown on the consolidated statement of cash flows | $ | 367,196 | | | $ | 322,136 | | | $ | 329,736 | | | $ | 429,485 | | | | | |
Restricted cash included in “Other non-current assets” in the accompanying consolidated balance sheet at September 30, 2023 primarily consisted of cash reserved to fund consumer claims.ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | |
| March 31, 2024 | | December 31, 2023 | | March 31, 2023 | | December 31, 2022 |
| (In thousands) |
Cash and cash equivalents | $ | 363,337 | | | $ | 364,044 | | | $ | 314,960 | | | $ | 321,155 | |
Restricted cash included in other current assets | — | | | — | | | — | | | 107 | |
Restricted cash included in other non-current assets | 253 | | | 257 | | | 376 | | | 371 | |
Restricted cash included in other non-current assets of discontinued operations | — | | | — | | | 504 | | | 503 | |
Total cash and cash equivalents, and restricted cash as shown on the statement of cash flows | $ | 363,590 | | | $ | 364,301 | | | $ | 315,840 | | | $ | 322,136 | |
Restricted cash included in “Other current assets” in the accompanying consolidated balance sheetssheet at December 31, 2022 and September 30, 2022 primarily consisted of cash reserved to fund insurance claims.
Restricted cash included in “Other current assets” in the accompanying consolidated balance sheet at December 31, 2021 primarily consisted of funds collected from service providers for disputed payments which were not settled as of the period end, in addition to cash reserved to fund insurance claims.
Restricted cash included in “Other non-current assets” in the accompanying consolidated balance sheets for all periods presented above except September 30, 2023primarily consisted of deposits related to leases. Restricted cash included in “Other non-current assets”
Credit Losses
The following table presents the changes in the accompanying consolidatedallowance for credit losses for the three months ended March 31, 2024 and 2023:
| | | | | | | | | | | | | |
| 2024 | | 2023 | | |
| (In thousands) |
Balance at January 1 | $ | 24,684 | | | $ | 38,846 | | | |
Current period provision for credit losses | 15,910 | | | 23,731 | | | |
Write-offs charged against the allowance for credit loss | (21,087) | | | (27,809) | | | |
| | | | | |
Recoveries collected | 1,263 | | | 1,236 | | | |
Balance at March 31 | $ | 20,770 | | | $ | 36,004 | | | |
Accumulated Amortization and Depreciation
The following table provides the accumulated depreciation and amortization within the balance sheet at September 30, 2022 and December 31, 2021 also included cash held related to a check endorsement guarantee for Roofing.sheet:
| | | | | | | | | | | | | | |
Asset Category | | March 31, 2024 | | December 31, 2023 |
| | (In thousands) |
| | | | |
Capitalized software, leasehold improvements, and equipment | | $ | 229,347 | | | $ | 215,357 | |
Intangible assets | | $ | 89,142 | | | $ | 89,229 | |
Other income, net
| | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2024 | | 2023 | | | | | | |
| (In thousands) | | |
Interest income | $ | 4,709 | | | $ | 3,419 | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
| | | | | | | | | |
Other | (225) | | | 388 | | | | | | | |
Other income, net | $ | 4,484 | | | $ | 3,807 | | | | | | | |
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Credit Losses
The following table presents the changes in the allowance for credit losses for the nine months ended September 30, 2023 and 2022:
| | | | | | | | | | | | | |
| 2023 | | 2022 | | |
| (In thousands) |
Balance at January 1 | $ | 43,160 | | | $ | 33,652 | | | |
Current period provision for credit losses | 67,288 | | | 82,216 | | | |
Write-offs charged against the allowance for credit losses | (78,680) | | | (72,212) | | | |
Recoveries collected | 4,352 | | | 4,136 | | | |
Balance at September 30 | $ | 36,120 | | | $ | 47,792 | | | |
Accumulated Amortization and Depreciation
The following table provides the accumulated amortization and depreciation within the consolidated balance sheet:
| | | | | | | | | | | | | | |
Asset Category | | September 30, 2023 | | December 31, 2022 |
| | (In thousands) |
Right-of-use assets (included in “other non-current assets”) | | $ | 71,436 | | | $ | 61,818 | |
Capitalized software, leasehold improvements, and equipment | | $ | 194,460 | | | $ | 146,608 | |
Intangible assets | | $ | 179,362 | | | $ | 172,341 | |
Other income (expense), net
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | 2022 | | 2023 | | 2022 |
| | | | | | | |
Interest income | $ | 4,871 | | | $ | 1,556 | | | $ | 12,450 | | | $ | 2,135 | |
| | | | | | | |
Foreign exchange (losses) gains | (993) | | | (3,852) | | | 433 | | | (6,572) | |
| | | | | | | |
| | | | | | | |
Other | 13 | | | — | | | 7 | | | — | |
Other income (expense), net | $ | 3,891 | | | $ | (2,296) | | | $ | 12,890 | | | $ | (4,437) | |
NOTE 9—CONTINGENCIES
In the ordinary course of business, the Company is a party to various lawsuits. The Company establishes accruals for specific legal matters when it determines that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable. The total accrual for legal matters is $5.3$1.7 million at September 30, 2023.March 31, 2024. Management has also identified certain other legal matters where it believes an unfavorable outcome is not probable and, therefore, no accrual is established. Although management currently believes that resolving claims against the Company, including claims where an unfavorable outcome is reasonably possible, and for which the Company cannot estimate a loss or range of loss, will not have a material impact on the liquidity, results of operations, or financial condition of the Company, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. The Company also evaluates other contingent matters, including uncertain income tax positions and non-income tax contingencies, to assess the likelihood of an unfavorable outcome and estimated extent of potential loss. It is possible that an unfavorable outcome of one or more of these lawsuits or other contingencies could have a material impact on the liquidity, results of operations, or financial condition of the Company. See “Note 6—Income Taxes” for additional information related to uncertain income tax positions. NOTE 10—RELATED PARTY TRANSACTIONS WITH IAC
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Allocation of CEO Compensation and Certain Expenses
Joseph Levin, CEO of IAC and Chairman of Angi, was appointed CEO of Angi on October 10, 2022. As a result, for the three and nine months ended September 30,March 31, 2024 and 2023, IAC allocated $2.6$2.2 million and $7.2$2.3 million, respectively, in costs to Angi (including salary, benefits, stock-based compensation and costs related to the CEO’s office). These costs were allocated from IAC based upon time spent on Angi by Mr. Levin. Management considers the allocation method to be reasonable. The allocated costs also include costs directly attributable to the Company that were initially paid for by IAC and billed by IAC to the Company.
On April 8, 2024, Jeffrey W. Kip, President of Angi Inc., was appointed to succeed Joseph Levin as CEO of Angi Inc. Mr. Levin will remain Chairman of the Angi Inc. board of directors.
The Combination and Related Agreements
Additionally,The Company and IAC, in connection with the transaction resulting in the formation of the CompanyAngi Inc. in 2017, which is referred to as the “Combination,” Angi and IAC entered into a contribution agreement; an investor rights agreement; a services agreement; a tax sharing agreement; and an employee matters agreement, which collectively govern the relationship between IAC and Angi Inc.
TheFor the three months ended March 31, 2024 and 2023, the Company was charged by IAC $1.8$1.2 million and $4.8$1.5 million, for the three and nine months ended September 30, 2023, respectively, and $0.8 million and $2.1 million for the three and nine months ended September 30, 2022 for services rendered pursuant to the services agreement. There were no outstanding payables pursuant to the services agreement at September 30, 2023March 31, 2024 and $0.8 million in outstanding payables pursuant to the services agreement at December 31, 2022.2023.
At September 30, 2023March 31, 2024 and December 31, 2022,2023, the Company had outstanding payables of $2.8 million and $1.4$2.1 million, respectively, due to IAC pursuant to the tax sharing agreement, which are included in “Accrued expenses and other current liabilities,” in the accompanying consolidated balance sheet. There were no payments to or refunds from IAC pursuant to this agreement during the three and nine months ended September 30, 2023March 31, 2024 and 2022.2023.
ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Other Arrangements
Additionally, the Company subleases office space to IAC and charged rent pursuant to a lease agreement of less than $0.1 million and $0.6$0.4 million for the three and nine months ended September 30,March 31, 2024 and 2023, respectively, and $0.4 million and $1.2 million for the three and nine months ended September 30, 2022, respectively. IAC subleases office space to the Company and charged rent pursuant to a lease agreement of $0.4$0.3 million and $1.0$0.3 million respectively for both the three and nine months ended September 30,March 31, 2024 and 2023, and 2022.respectively. At September 30, 2023,March 31, 2024, the Company has an outstanding receivable of $0.2$0.3 million due from IAC pursuant to the sublease agreements. This amount is included in “Other non-current assets” in the accompanying consolidated balance sheet. At December 31, 2022,2023, there were no outstanding receivables or payablesof $0.3 million due from IAC and no payable due to IAC pursuant to the sublease agreements.
The Company incurred advertising expense of $1.5$1.2 million and $5.1$1.8 million for the three and nine months ended September 30,March 31, 2024 and 2023, respectively, and $1.7 million and $5.2 million for the three and nine months ended September 30, 2022, respectively, related to advertising and audience targeted advertising purchased from another IAC owned business. At September 30, 2023March 31, 2024 and December 31, 2022,2023, there were related outstanding payables of $0.9$0.7 million and $1.1$1.3 million, respectively, included in “Accrued expenses and other current liabilities” in the accompanying consolidated balance sheet.
NOTE 11—SUBSEQUENT EVENTSDISCONTINUED OPERATIONS
On November 1, 2023, Angi Inc. completed the sale of 100% of its wholly-owned subsidiary, Total Home Roofing, LLC (“THR”)THR, and has reflected it as a discontinued operation in its financial statements. The financial information for prior periods has been recast to a non-public third-party. THR comprises the entiretyconform to this presentation.
The components of the
Roofing segment. See “Note 5—Segment Information”loss from discontinued operations for additional information relatedthe three months ended March 31, 2023, in the statement of operations consisted of the following: | | | | | | | |
| Three Months Ended March 31, | |
| 2023 | | |
| (In thousands) |
Revenue | $ | 38,372 | | | |
Operating costs and expenses: | | | |
Cost of revenue (exclusive of depreciation shown separately below) | 25,104 | | | |
Selling and marketing expense | 6,761 | | | |
General and administrative expense | 5,851 | | | |
| | | |
Depreciation | 245 | | | |
| | | |
| | | |
Total operating costs and expenses | 37,961 | | | |
Operating income from discontinued operations | 411 | | | |
Interest income | 4 | | | |
| | | |
Income from discontinued operations before tax | 415 | | | |
Income tax provision | (1,428) | | | |
Loss from discontinued operations, net of tax | $ | (1,013) | | | |
During the period in which Angi owned THR, the Ads & Leads segment provided services totaling $1.5 million to the Roofing segment results includedfor the three months ended March 31, 2023. Such services have and will continue in periods subsequent to the financial statements.
Subsequent to September 30, 2023, Angi Inc. management announced its intent to put in place a share repurchase plan withdisposition of the intent of utilizing the full 14.0 million shares remaining in its current stock repurchase authorization.Roofing segment on November 1, 2023.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
GENERAL
Management Overview
Angi Inc. (“Angi,” the “Company,” “we,” “our,” or “us”) connects quality home service professionals with consumers across more than 500 different categories, from repairing and remodeling homes to cleaning and landscaping. Approximately 202,000192,000 transacting service professionals actively sought consumer matches, completed jobs, or advertised work through Angi Inc. platforms during the three months ended September 30, 2023.March 31, 2024. Additionally, consumers turned to at least one of our brandsbusinesses to find a service professional for approximately 2521 million projects during the twelve months ended September 30, 2023.March 31, 2024.
The Company has fourthree operating segments: (i) Ads and Leads; (ii) Services; (iii) Roofing; and (iv)(iii) International (consisting of businesses in Europe and Canada) and operates under multiple brands including Angi, HomeAdvisor, Handy, Total Home Roofing, and Angi Roofing.Handy.
Ads and Leads provides service professionals the capability to engage with potential customers, including quotequoting and invoicing services, and provides consumers with tools and resources to help them find local, pre-screened and customer-rated service professionals nationwide for home repair, maintenance and improvement projects. Services consumers can request household services directly through the Angi platform and Angi fulfills the request through the use of independently established home services providers engaged in a trade, occupation and/or businessesbusiness that customarily provides such services. The matching, and pre-priced booking services, and related tools and directories are provided to consumers free of charge. Roofing provides roof replacement and repair services through its wholly-owned subsidiary Angi Roofing, LLC.
For a more detailed description of the Company’s operating businesses, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.2023.
Total Home Roofing, LLC Sale
On November 1, 2023, Angi Inc. completed the sale of 100% of its wholly-owned subsidiary, Total Home Roofing, LLC (“THR,” which comprised its Roofing segment), and has reflected it as a discontinued operation in its financial statements. The financial information for prior periods has been recast to conform to this presentation. For additional details, see “Note 11—Discontinued Operations” to the consolidated financial statements included in “Item 1. Consolidated Financial Statements.” Defined Terms and Operating Metrics:
Unless otherwise indicated or as the context otherwise requires, certain terms, which include the principal operating metrics we use in managing our business, are defined below:
•Ads and Leads Revenue primarily reflectscomprises domestic revenue from consumer connection revenue for consumer matches, revenue from service professionals under contract for advertising and membership subscription revenue from service professionals and consumers.
•Services Revenue primarily reflectscomprises domestic revenue from pre-priced offerings by which the consumer requests services through a Company platform and the Company connects them with a service professional to perform the service.
•Roofing Revenue primarily reflects revenue from the roof replacement business offering by which the consumer purchases services directly from the Company and the Company engages a service professional to perform the service.
•International Revenue primarily reflectscomprises revenue generated within the International segment (consisting of businesses in Europe and Canada), including consumer connection revenue for consumer matches and membership subscription revenue from service professionals and consumers.
•Corporate primarily reflectscomprises costs for corporate initiatives, shared costs, such as executive and public company costs, and other expenses not allocated to the operating segments.
•Service Requests are (i) fully completed and submitted domestic service requests for connections with Ads and Leads service professionals, (ii) contacts to Ads and Leads service professionals generated via the service professional directory from unique users in unique categories (such that multiple contacts from the same user in the same category in the same day are counted as one Service Request) and (iii) requests to book Services jobs in the period.
•Monetized Transactions are (i) Service Requests that are matched to a paying Ads and Leads service professional in
the period and (ii) completed and in-process Services jobs in the period; a single Service Request can result in multiple
monetized transactions.
•Transacting Service Professionals (“Transacting SPs”) are the number of (i) Ads and Leads service professionals that paid for consumer matches or advertising and (ii) Services service professionals that performed a Services job, during the most recent quarter.
•ANGI Group Senior Notes - On August 20, 2020, ANGI Group, LLC (“ANGI Group”), a direct wholly-owned subsidiary of the Company, issued $500.0 million of its 3.875% Senior Notes due August 15, 2028, with interest payable February 15 and August 15 of each year.
Components of Results of Operations
Sources of Revenue
Ads and Leads Revenue is primarily derived from (i) consumer connection revenue, which is comprised of fees paid by service professionals for consumer matches (regardless of whether the service professional ultimately provides the requested service), (ii) advertising revenue, which includes revenue from service professionals under contract for advertising, and (iii) membership subscription revenue from service professionals and consumers. Consumer connection revenue varies based upon several factors including the service requested, product experience offered, and geographic location of service. Services is primarily comprised of revenue from jobs sourced directly through the platform and through retail partnerships and completed by a service professional assigned by our platform. Roofing consists of revenue from roofing projects. International is primarily comprised of revenue from consumer connection revenue for consumer matches and membership subscription from service professional and consumers.
From January 1, 2020 through December 31, 2022, Services recorded revenue on a gross basis. Effective January 1, 2023, we modified the Services terms and conditions so that the service professional, rather than Angi Inc., has the contractual relationship with the consumer to deliver the service and our performance obligation to the consumer is to connect them with the service professional. This change in contractual terms requires revenue be reported as the net amount of what is received from the consumer after deducting the amounts owed to the service professional providing the service effective for all arrangements entered into after December 31, 2022. There is no impact to operating loss or Adjusted EBITDA from this change in revenue recognition. For the three and nine months ended September 30, 2022, if Services revenue were recorded on a net basis, revenue would have been reduced by $64.8 million and $187.5 million, respectively.
Cost of Revenue and Gross Profit
Cost of revenue, which excludes depreciation, consists primarily of (i) roofing material costs associated with Roofing,credit card processing fees, (ii) hosting fees, and (iii) payments made to independent third-party service professionals who perform work contracted under Services arrangements that were entered into prior to January 1, 2023 and the change to net revenue reporting or Roofing arrangements, (iii) credit card processing fees, and (iv) hosting fees.work.
Gross profit is revenue less cost of revenue. Gross margin is gross profit expressed as a percentage of revenue.
Operating Costs and Expenses:
•Selling and marketing expense - consists primarily of (i) advertising expenditures, which include marketing fees to promote the brand to consumers and service professionals with (a) online marketing, including fees paid to search engines and other online marketing platforms, partners who direct traffic to our brands, and app platforms, and (b) offline marketing, which is primarily television and radio advertising, (ii) compensation expense (including stock-based compensation expense) and other employee-related costs for our sales force and marketing personnel, (iii) service guarantee expense, (iv) software license and maintenance costs, and (v) outsourced personnel costs.
•General and administrative expense - consists primarily of (i) compensation expense (including stock-based compensation expense) and other employee-related costs for personnel engaged in executive management, finance, legal, tax, human resources and customer service functions, (ii) provision for credit losses, (iii) software license and maintenance costs, (iv) outsourced personnel costs for personnel engaged in assisting in customer service functions, (v) fees for professional services, and (vi) rent expense and facilities costs.costs (including impairments of right-of-use assets). Our customer service function includes personnel who provide support to our service professionals and consumers.
•Product development expense - consists primarily of (i) compensation expense (including stock-based compensation expense) and other employee-related costs that are not capitalized for personnel engaged in the design, development, testing and enhancement of product offerings and related technology, (ii) software license and maintenance costs, and (iii) outsourced personnel costs for personnel engaged in product development, and (iii) software license and maintenance costs.development.
Non-GAAP financial measure
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) is a non-GAAP financial measure. See “Principles of Financial Reporting” for the definition of Adjusted EBITDA and a reconciliation of net loss attributable to Angi Inc. shareholders to operating lossincome (loss) to consolidated Adjusted EBITDA for the three and nine months ended September 30, 2023March 31, 2024 and 2022.2023.
Results of Operations for the three and nine months ended September 30, 2023Three Months Ended March 31, 2024 compared to the three and nine months ended September 30, 2022Three Months Ended March 31, 2023
Revenue | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
Domestic | | | | | | | | | | | | | | | |
Ads and Leads: | | | | | | | | | | | | | | | |
Consumer connection revenue | $ | 203,579 | | | $ | (59,355) | | | (23)% | | $ | 262,934 | | | $ | 625,527 | | | $ | (112,650) | | | (15)% | | $ | 738,177 | |
Advertising revenue | 75,074 | | | 7,909 | | | 12% | | 67,165 | | | 212,302 | | | 16,046 | | | 8% | | 196,256 | |
Membership subscription revenue | 13,167 | | | (1,628) | | | (11)% | | 14,795 | | | 39,597 | | | (6,989) | | | (15)% | | 46,586 | |
Other revenue | 173 | | | (462) | | | (73)% | | 635 | | | 560 | | | (558) | | | (50)% | | 1,118 | |
Total Ads and Leads revenue | 291,993 | | | (53,536) | | | (15)% | | 345,529 | | | 877,986 | | | (104,151) | | | (11)% | | 982,137 | |
Services revenue | 29,964 | | | (75,928) | | | (72)% | | 105,892 | | | 91,890 | | | (198,684) | | | (68)% | | 290,574 | |
Roofing revenue | 21,400 | | | (4,593) | | | (18)% | | 25,993 | | | 84,254 | | | (21,076) | | | (20)% | | 105,330 | |
Intersegment eliminations | (794) | | | 2,031 | | | 72% | | (2,825) | | | (3,257) | | | 3,195 | | | 50% | | (6,452) | |
Total Domestic revenue | 342,563 | | | (132,026) | | | (28)% | | 474,589 | | | 1,050,873 | | | (320,716) | | | (23)% | | 1,371,589 | |
International revenue | 29,274 | | | 5,827 | | | 25% | | 23,447 | | | 88,439 | | | 10,051 | | | 13% | | 78,388 | |
Total revenue | $ | 371,837 | | | $ | (126,199) | | | (25)% | | $ | 498,036 | | | $ | 1,139,312 | | | $ | (310,665) | | | (21)% | | $ | 1,449,977 | |
| | | | | | | | | | | | | | | |
Percentage of Total Revenue: | | | | | | | | | | | | | | | |
Domestic | 92 | % | | | | | | 95 | % | | 92 | % | | | | | | 95 | % |
International | 8 | % | | | | | | 5 | % | | 8 | % | | | | | | 5 | % |
Total revenue | 100 | % | | | | | | 100 | % | | 100 | % | | | | | | 100 | % |
| | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | Change | | % Change | | 2022 | | 2023 | | Change | | % Change | | 2022 |
| (In thousands, rounding differences may occur) |
Operating metrics: | | | | | | | | | | | | | | | |
Service Requests | 6,065 | | | (1,836) | | | (23)% | | 7,901 | | | 18,931 | | | (4,419) | | | (19)% | | 23,350 | |
Monetized Transactions | 7,355 | | | (424) | | | (5)% | | 7,779 | | | 21,611 | | | (1,290) | | | (6)% | | 22,901 | |
Transacting SPs | 202 | | | (43) | | | (17)% | | 245 | | | | | | | | | |
For the three months ended September 30, 2023 compared to the three months ended September 30, 2022 | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 | | $ Change | | % Change |
| (Dollars in thousands) |
Domestic | | | | | | | |
Ads and Leads: | | | | | | | |
Consumer connection revenue | $ | 160,531 | | | $ | 212,935 | | | $ | (52,404) | | | (25)% |
Advertising revenue | 77,137 | | | 67,181 | | | 9,956 | | | 15% |
Membership subscription revenue | 11,778 | | | 13,199 | | | (1,421) | | | (11)% |
Other revenue | 139 | | | 191 | | | (52) | | | (27)% |
Total Ads and Leads revenue | 249,585 | | | 293,506 | | | (43,921) | | | (15)% |
Services revenue | 20,451 | | | 32,059 | | | (11,608) | | | (36)% |
Total Domestic revenue | 270,036 | | | 325,565 | | | (55,529) | | | (17)% |
International revenue | 35,354 | | | 29,932 | | | 5,422 | | | 18% |
Total revenue | $ | 305,390 | | | $ | 355,497 | | | $ | (50,107) | | | (14)% |
| | | | | | | |
Percentage of Total Revenue: | | | | | | | |
Domestic | 88 | % | | 92 | % | | | | |
International | 12 | % | | 8 | % | | | | |
Total revenue | 100 | % | | 100 | % | | | | |
| | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 | | Change | | % Change |
| (In thousands, rounding differences may occur) |
Operating metrics: | | | | | | | |
Service Requests | 4,126 | | | 6,004 | | | (1,878) | | | (31)% |
Monetized Transactions | 5,511 | | | 6,451 | | | (940) | | | (15)% |
Transacting SPs | 192 | | | 206 | | | (14) | | | (7)% |
Ads and Leads revenue decreased $53.5$43.9 million, or 15%, due primarily to a decrease in consumer connection revenue of $59.4$52.4 million, or 23% and a decrease in membership subscription revenue of $1.6 million, or 11%25%, due to a decline in Monetized Transactions and a decline in service professionals in the Angi network, partially offset by an increase of $7.9$10.0 million, or 12%15%, in advertising revenue. The decrease in consumer connection revenue was due primarily to declines in Monetized Transactions wasas a result of an effortfewer transacting SPs resulting from a reduction in unprofitable sales and changes to rationalize sales to service professionals that are unprofitable, as well as effortsdemand channels to increase lead quality including changes to certain demand channels, to enhance the user experience for both homeowners and service professionals.professionals and to improve profitability through greater matching efficiency and bidding optimization as evidenced by a higher ratio of Monetized Transactions per Service Request. The increase in advertising revenue was primarily driven by continued growth in sales and improved retention.sales.
Services revenue decreased $75.9$11.6 million, or 72%36%, due primarily to lower Service Requests as a result of certain efforts described in Ads and Leads above. In addition, the changedecrease in revenue reflects the residual impact from contracts entered into prior to January 1, 2023 and recognized as gross revenue in the first quarter of 2023. Effective January 1, 2023, Angi Inc. modified the Services terms and conditions resulting in net revenue reporting described above under “Sources of Revenue,” a decrease of $27.1 million due to the continued shift away from complex and less profitable offerings, and lower Service Requests.
Roofing revenue decreased $4.6 million, or 18%, due primarily to a decline in projects and a strategic shift of operations to select markets.reporting.
International revenue increased $5.8$5.4 million, or 25%18%, due primarily to a larger service professional network and higher revenue per service professional.
For the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022
Ads and Leads revenue decreased $104.2 million, or 11%, due primarily to a decrease in consumer connection revenue of $112.7 million, or 15%, and a decrease in membership subscription revenue of $7.0 million, or 15%, due to a decline in Monetized Transactions and a decline in service professionals in the Angi network, partially offset by an increase of $16.0 million, or 8%, in advertising revenue. The decrease in Monetized Transactions was a result of an effort to rationalize sales to service professionals that are unprofitable, as well as efforts to increase lead quality, including changes to certain demand channels, to enhance the user experience for both homeowners and service professionals. The increase in advertising revenue was primarily driven by growth in sales and improved retention.
Services revenue decreased $198.7 million, or 68%, due primarily to the change to net revenue reporting described above under “Sources of Revenue,” a decrease of $69.6 million due to the continued shift away from complex and less profitable offerings, and lower Service Requests.
Roofing revenue decreased $21.1 million, or 20%, due primarily to factors described above in the three-month discussion.
International revenue increased $10.1 million, or 13%, due primarily to the factors described above in the three-month discussion.
Cost of revenue
| | Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
| Three Months Ended March 31, | | | Three Months Ended March 31, |
| 2024 | | | 2024 | | 2023 | | $ Change | | % Change |
| (Dollars in thousands) | | | (Dollars in thousands) |
Cost of revenue (exclusive of depreciation shown separately below) | Cost of revenue (exclusive of depreciation shown separately below) | $ | 28,737 | | | $ | (80,320) | | | (74)% | | $ | 109,057 | | | $ | 102,440 | | | $ | (233,386) | | | (69)% | | $ | 335,826 | | Cost of revenue (exclusive of depreciation shown separately below) | $ | 12,497 | | | $ | | $ | 16,937 | | | $ | | $ | (4,440) | | | (26)% | | (26)% |
As a percentage of revenue | As a percentage of revenue | 8% | | 22% | | 9% | | 23% |
For the three months ended September 30, 2023 compared to the three months ended September 30, 2022
Ads and Leads cost of revenue decreased $1.7 million, or 17%, and stayed consistent as a percentage of revenue, due primarily to the decrease in revenue of $53.5 million.
Services cost of revenue decreased $72.8$5.9 million, or 94%66%, and decreased as a percentage of revenue, due primarily to a $66.2$5.3 million decrease in payments to third-party professional service providers due primarily toreflecting the changeresidual impact from contracts entered into prior to net revenue reporting effective January 1, 2023, described above. Additionally, payments to third-party professional service providers decreased as a result of the shift away from complex and less profitable offerings.2023.
Roofing cost of revenue decreased $5.9 million, or 28%, and decreased as a percentage of revenue, due primarily to the reduction of revenue discussed above that resulted in a $2.3 million decrease in roofing material costs and a $1.0 million decrease in third-party professional service providers.
For the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022
Ads and Leads cost of revenue decreased $4.6 million, or 16%, and stayed consistent as a percentage of revenue, due primarily to the decrease in revenue of $104.2 million.
Services cost of revenue decreased $206.8 million, or 92%, and decreased as a percentage of revenue, due primarily to a $186.9 million decrease in payments to third-party professional service providers due primarily to the change to net revenue reporting effective January 1, 2023, described above. Additionally, payments to third-party professional service providers decreased as a result of the shift away from complex and less profitable offerings.
Roofing cost of revenue decreased $22.4 million, or 28%, and decreased as a percentage of revenue, due primarily to the reduction of revenue discussed above that resulted in a $11.0 million decrease in roofing material costs and a $6.0 million decrease in third-party professional service providers.
Gross profit
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
Revenue | $ | 371,837 | | | $ | (126,199) | | | (25)% | | $ | 498,036 | | | $ | 1,139,312 | | | $ | (310,665) | | | (21)% | | $ | 1,449,977 | |
Cost of revenue (exclusive of depreciation shown separately below) | 28,737 | | | (80,320) | | | (74)% | | 109,057 | | | 102,440 | | | (233,386) | | | (69)% | | 335,826 | |
Gross profit | $ | 343,100 | | | $ | (45,879) | | | (12)% | | $ | 388,979 | | | $ | 1,036,872 | | | $ | (77,279) | | | (7)% | | $ | 1,114,151 | |
| | | | | | | | | | | | | | | |
Gross margin | 92% | | | | 14% | | 78% | | 91% | | | | 14% | | 77% |
For the three months ended September 30, 2023 compared to the three months ended September 30, 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2024 | | 2023 | | $ Change | | % Change | | | | | | | | |
| (Dollars in thousands) |
Revenue | $ | 305,390 | | | $ | 355,497 | | | $ | (50,107) | | | (14)% | | | | | | | | |
Cost of revenue (exclusive of depreciation shown separately below) | 12,497 | | | 16,937 | | | (4,440) | | | (26)% | | | | | | | | |
Gross profit | $ | 292,893 | | | $ | 338,560 | | | $ | (45,667) | | | (13)% | | | | | | | | |
| | | | | | | | | | | | | | | |
Gross margin | 96% | | 95% | | | | 1% | | | | | | | | |
Angi gross profit decreased $45.9$45.7 million, or 12%, due primarily to the decrease in revenue described in the revenue discussion above.
For the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022
Angi gross profit decreased $77.3 million, or 7%13%, due primarily to the decrease in revenue described in the revenue discussion above.
Selling and marketing expense
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
Selling and marketing expense | $ | 204,006 | | | $ | (30,391) | | | (13)% | | $ | 234,397 | | | $ | 621,628 | | | $ | (89,729) | | | (13)% | | $ | 711,357 | |
As a percentage of revenue | 55% | | | | | | 47% | | 55% | | | | | | 49% |
For the three months ended September 30, 2023 compared to the three months ended September 30, 2022 | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 | | $ Change | | % Change |
| (Dollars in thousands) |
Selling and marketing expense | $ | 157,051 | | | $ | 199,610 | | | $ | (42,559) | | | (21)% |
As a percentage of revenue | 51% | | 56% | | | | |
Ads and Leads selling and marketing expense decreased $21.3$40.3 million, or 10%23%, driven by decreases in advertising expense of $18.4 million. The decrease in advertising$31.9 million due to improved efficiency and compensation expense wasof $7.5 million primarily due to a $32.8 million decreasereduction in online advertising spend due to increased efficiency, partially offset by a $15.8 million increase in television spend due to efforts to build awareness of the Angi brand.headcount.
Services selling and marketing expense decreased $9.7$4.4 million, or 53%35%, driven by decreasesa decrease of $5.6 million in professional fees and third-party wages, $5.1$1.9 million in compensation expense, and $2.3 million in advertising expense, partially offset by an increase of $4.1 million in service guarantee expense. The decrease in professional fees and third-party wages is primarily due to $1.8 million less in phone-based sales wages primarily resulting from increased reliance on more profitable digital conversion channels and $2.8 million less due to streamlined fulfillment operations, partially driven by fewer complex services. The decrease in compensation expense is primarily due to a reduction in headcount. The decrease in advertising expense is primarily due to a decrease in service professional marketing spend. The increase in service guarantee expense is due to the aforementioned change in contractual terms and conditions resultinglower headcount beginning in the change to net revenue reporting such that this expense is no longer a componentsecond quarter of cost of revenue, which is where the expense was recorded prior to January 1, 2023.
Roofing selling and marketing expense decreased $2.7 million, or 37%, primarily driven by a decrease of $1.4 million in advertising expense as a result of lower and more efficient marketing spend.
For the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022
Ads and Leads selling and marketing expense decreased $49.5 million, or 8%, driven by decreases in advertising expense of $51.4 million and professional fees of $4.1 million, partially offset by an increase in compensation expense of $7.8 million. The decrease in advertising expense was primarily due to a $76.2 million decrease in online advertising spend due to increased efficiency, partially offset by a $24.6 million increase in television spend due to efforts to build awareness of the Angi brand. The decrease in professional fees is primarily due to a decrease in background checks, marketing and branding consultancy
fees. The increase in compensation expense is primarily due to increased sales commissions due to the immediate expensing of commissions for certain transactions beginning October 1, 2022.
Services selling and marketing expense decreased $26.5 million, or 46%, driven by decreases of $17.9 million in professional fees and third-party wages, $12.2 million in compensation expense, and $5.2 million in advertising expense, partially offset by an increase of $11.4 million in service guarantee expense. The decrease in professional fees and third-party wages is primarily due to $10.5 million less in phone-based sales wages primarily resulting from increased reliance on more profitable digital conversion channels and $5.2 million less due to streamlined fulfillment operations, partially driven by fewer complex services. The decrease in compensation expense is primarily due to a reduction in headcount. The decrease in advertising expense is primarily due to a decrease in service professional marketing spend. The increase in service guarantee expense is due to the aforementioned change in contractual terms and conditions such that this expense is no longer a component of cost of revenue, which is where the expense was recorded prior to January 1, 2023.
Roofing selling and marketing expense decreased $7.2 million, or 31%, primarily driven by a decrease of $3.3 million in compensation expense as a result of a reduction in headcount and a strategic shift of operations to select markets.
International selling and marketing expense decreased $7.0 million, or 20%, driven by a decrease of $10.3 million in advertising expense, partially offset by an increase in compensation expense of $2.7 million. The decrease in advertising expense is primarily due to improved online efficiency and a decrease in television advertising expense. The increase in compensation expense is primarily driven by an increase in headcount.
General and administrative expense
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
General and administrative expense | $ | 102,476 | | | $ | (25,784) | | | (20)% | | $ | 128,260 | | | $ | 301,979 | | | $ | (55,562) | | | (16)% | | $ | 357,541 | |
As a percentage of revenue | 28% | | | | | | 26% | | 27% | | | | | | 25% |
For the three months ended September 30, 2023 compared to the three months ended September 30, 2022 | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 | | $ Change | | % Change |
| (Dollars in thousands) |
General and administrative expense | $ | 85,521 | | | $ | 96,667 | | | $ | (11,146) | | | (12)% |
As a percentage of revenue | 28% | | 27% | | | | |
Ads and Leads general and administrative expense decreased $22.8$7.4 million, or 27%12%, due primarily to decreases of $14.1$7.7 million in the provision for credit losses $6.3and $3.5 million in professional fees, $3.1partially offset by a $1.9 million increase in third-party wages, and $1.8 million in compensationlease expense. The decrease in the provision for credit losses is primarily due to lower revenue and improved collection rates. The decrease in professional fees is primarily due to a reduction in legal fees.legal-related expenses. The decreaseincrease in third-party wages is primarily due to a reduction in third-party providers. The decrease in compensationlease expense is primarily due to an impairment charge of a reductionright-of-use asset recognized in headcount.
For the nine months ended September 30, 2023 comparedfirst quarter of 2024 related to the nine months ended September 30, 2022
Ads and Leads general and administrative expense decreased $44.8 million, or 20%, due primarily to decreases of $14.9 million in the provision for credit losses, $12.1 million in compensation expense, $8.5 million in professional fees, and $6.5 million in third-party wages. The decrease in the provision for credit losses is primarily due to lower revenue and improved collection rates. The decrease in compensation expense is primarily due to a reduction in headcount. The decrease in professional fees is primarily due to a reduction in legal fees. The decrease in third-party wages is primarily due to a reduction in third-party providers.
Services general and administrative expense decreased $8.9 million, or 20%, due primarily to decreases of $6.9 million in compensation expense and $3.9 million in the provision for credit losses. The decrease in compensation expense is primarily due to a reduction in headcount. The decrease in the provision for credit losses is primarily due to improved collection rates and lower revenue.
Roofing general and administrative expense decreased $6.3 million, or 32%, primarily driven by a decrease of $3.4 million in compensation expense as a result of a reduction in headcount and a strategic shift of operations to select markets.Company reducing its real estate footprint.
Product development expense
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
Product development expense | $ | 21,497 | | | $ | 5,681 | | | 36% | | $ | 15,816 | | | $ | 72,358 | | | $ | 17,729 | | | 32% | | $ | 54,629 | |
As a percentage of revenue | 6% | | | | | | 3% | | 6% | | | | | | 4% |
For the three months ended September 30, 2023 compared to the three months ended September 30, 2022
Product development expense increased $5.7 million, or 36%. This contrasts with a $19.6 million, or 59%, decrease in capital expenditures, which is primarily comprised of internally developed software. The increase in product development expense was driven by a decrease in the percentage of internally developed software that was subject to capitalization.
For the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022
Product development expense increased $17.7 million, or 32%. This contrasts with a $59.4 million, or 62%, decrease in capital expenditures, which is primarily comprised of internally developed software. The increase in product development expense was driven by a decrease in the percentage of internally developed software that was subject to capitalization.
Depreciation
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
Depreciation | $ | 22,596 | | | $ | 4,837 | | | 27% | | $ | 17,759 | | | $ | 70,210 | | | $ | 25,098 | | | 56% | | $ | 45,112 | |
As a percentage of revenue | 6% | | | | | | 4% | | 6% | | | | | | 3% |
For the three and nine months ended September 30, 2023 compared to the three and nine months ended September 30, 2022
Depreciation increased due primarily to investments in capitalized software made in prior periods which are being depreciated over an average useful life of two years.
Operating income (loss)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
Ads and Leads | $ | 8,115 | | | $ | (14,639) | | | (64)% | | $ | 22,754 | | | $ | 26,386 | | | $ | (35,146) | | | (57)% | | $ | 61,532 | |
Services | (3,887) | | | 6,893 | | | 64% | | (10,780) | | | (21,514) | | | 36,067 | | | 63% | | (57,581) | |
Roofing | (2,246) | | | 6,299 | | | 74% | | (8,545) | | | (3,137) | | | 15,347 | | | 83% | | (18,484) | |
Corporate | (14,854) | | | 688 | | | 4% | | (15,542) | | | (46,361) | | | 294 | | | 1% | | (46,655) | |
Total Domestic | (12,872) | | | (759) | | | (6)% | | (12,113) | | | (44,626) | | | 16,562 | | | 27% | | (61,188) | |
International | 2,764 | | | 1,709 | | | 162% | | 1,055 | | | 7,365 | | | 12,078 | | | NM | | (4,713) | |
Total | $ | (10,108) | | | $ | 950 | | | 9% | | $ | (11,058) | | | $ | (37,261) | | | $ | 28,640 | | | 43% | | $ | (65,901) | |
| | | | | | | | | | | | | | | |
As a percentage of revenue | (3)% | | | | | | (2)% | | (3)% | | | | | | (5)% |
________________________
NM = Not meaningful
For the three and nine months ended September 30, 2023 compared to the three and nine months ended September 30, 2022
Services general and administrative expense decreased $4.3 million, or 34%, due primarily to a decrease of $3.7 million in compensation expense due primarily to a $2.9 million decrease in stock-based compensation as a result of a reduction in headcount.
Product development expense
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2024 | | 2023 | | $ Change | | % Change | | | | | | | | |
| (Dollars in thousands) |
Product development expense | $ | 23,756 | | | $ | 25,312 | | | $ | (1,556) | | | (6)% | | | | | | | | |
As a percentage of revenue | 8% | | 7% | | | | | | | | | | | | |
Product development expense decreased $1.6 million, or 6%, and is not materially different from the first quarter of 2023.
Depreciation
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 | | $ Change | | % Change |
| (Dollars in thousands) |
Depreciation | $ | 23,849 | | | $ | 25,190 | | | $ | (1,341) | | | (5)% |
As a percentage of revenue | 8% | | 7% | | | | |
Depreciation decreased $1.3 million, or 5%, and is not materially different from the first quarter of 2023.
Operating lossesincome (loss)
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 | | $ Change | | % Change |
| (Dollars in thousands) |
Ads and Leads | $ | 19,821 | | | $ | 13,480 | | | $ | 6,341 | | | 47% |
Services | (7,501) | | | (12,452) | | | 4,951 | | | 40% |
Corporate | (15,117) | | | (14,939) | | | (178) | | | (1)% |
Total Domestic | (2,797) | | | (13,911) | | | 11,114 | | | 80% |
International | 5,513 | | | 3,030 | | | 2,483 | | | 82% |
Total | $ | 2,716 | | | $ | (10,881) | | | $ | 13,597 | | | NM |
| | | | | | | |
As a percentage of revenue | 1% | | (3)% | | | | |
________________________NM = Not meaningful
Operating loss decreased for the three and nine months ended September 30, 2023 compared$13.6 million to the three and nine months ended September 30, 2022income of $2.7 million due primarily to the factors described above in the revenue, cost of revenue, sellingsales and marketing, general and administrative, product development, and depreciation expense discussions.
At September 30, 2023,March 31, 2024, there is $51.0was $48.7 million of unrecognized compensation cost, net of estimated forfeitures, related to all equity-based awards, which is expected to be recognized over a weighted average period of approximately 2.35 years.
Adjusted EBITDA
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
Ads and Leads | $ | 32,198 | | | $ | (11,146) | | | (26)% | | $ | 43,344 | | | $ | 100,204 | | | $ | (19,629) | | | (16)% | | $ | 119,833 | |
Services | 3,534 | | | 5,476 | | | NM | | (1,942) | | | 3,066 | | | 37,488 | | | NM | | (34,422) | |
Roofing | (1,983) | | | 5,888 | | | 75% | | (7,871) | | | (2,456) | | | 13,531 | | | 85% | | (15,987) | |
Corporate | (11,933) | | | 617 | | | 5% | | (12,550) | | | (37,396) | | | 706 | | | 2% | | (38,102) | |
Total Domestic | 21,816 | | | 835 | | | 4% | | 20,981 | | | 63,418 | | | 32,096 | | | 102% | | 31,322 | |
International | 4,046 | | | 2,145 | | | 113% | | 1,901 | | | 11,237 | | | 13,157 | | | NM | | (1,920) | |
Total | $ | 25,862 | | | $ | 2,980 | | | 13% | | $ | 22,882 | | | $ | 74,655 | | | $ | 45,253 | | | 154% | | $ | 29,402 | |
| | | | | | | | | | | | | | | |
As a percentage of revenue | 7% | | | | | | 5% | | 7% | | | | | | 2% |
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 | | $ Change | | % Change |
| (Dollars in thousands) |
Ads and Leads | $ | 41,221 | | | $ | 39,851 | | | $ | 1,370 | | | 3% |
Services | 10 | | | (2,168) | | | 2,178 | | | NM |
Corporate | (11,921) | | | (12,354) | | | 433 | | | 4% |
Total Domestic | 29,310 | | | 25,329 | | | 3,981 | | | NM |
International | 6,652 | | | 4,354 | | | 2,298 | | | 53% |
Total | $ | 35,962 | | | $ | 29,683 | | | $ | 6,279 | | | 21% |
| | | | | | | |
As a percentage of revenue | 12% | | 8% | | | | |
For the three months ended September 30, 2023 compared to the three months ended September 30, 2022
Ads and Leads Adjusted EBITDA decreased $11.1increased $1.4 million, or 26%3%, to $32.2$41.2 million, and decreasedincreased as a percentage of revenue, driven by lower selling and marketing expense due to improved marketing efficiency and lower general and administrative expense due to the decrease in the provision for credit losses and legal-related expenses, partially offset by lower gross profit due to a decrease in revenue partially offset by lower general and administrative expense due to lower compensation costs and other operating expenses and lower selling and marketing expense due to improved marketing efficiency.an increase in lease expense.
Services Adjusted EBITDA increased $5.5$2.2 million, from a loss of $1.9$2.2 million to income of $3.5less than $0.1 million, and increased as a percentage of revenue, driven by higher gross profit due to pricing and fulfillment optimization efforts over the past year and lower operating expenses due to a reduced overall cost base as a result of exiting complex and less profitable offerings.
Roofing Adjusted EBITDA loss decreased $5.9 million, or 75%, to $2.0 million, and decreased as a percentage of revenue, driven by a decrease in selling and marketing expense and general and administrative expense due to headcount rationalization and a strategic shift of operations to select markets.
International Adjusted EBITDA increased $2.1$2.3 million, or 113%53%, to $4.0$6.7 million, driven by an increase in revenue and lower selling and marketing expense due to more efficient marketing spend.
For the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022
Ads and Leads Adjusted EBITDA decreased $19.6 million, or 16%, to $100.2 million, and decreased as a percentage of revenue, driven by lower gross profit due to a decrease in revenue, partially offset by lower selling and marketing expense due to improved marketing efficiency and lower general and administrative expense due to lower compensation costs and other operating expenses.
Services Adjusted EBITDA increased $37.5 million, from a loss of $34.4 million to income of $3.1 million, and decreased as a percentage of revenue, driven by higher gross profit due to pricing and fulfillment optimization efforts over the past year and lower operating expenses due to a reduced overall cost base as a result of exiting complex and less profitable offerings.
Roofing Adjusted EBITDA loss decreased $13.5 million, or 85%, to $2.5 million, and decreased as a percentage of revenue, driven by a decrease in selling and marketing expense and general and administrative expense due to headcount rationalization and a strategic shift of operations to select markets.
International Adjusted EBITDA increased $13.2 million, from a loss of $1.9 million to income of $11.2 million, driven by an increase in revenue and lower selling and marketing expense due to more efficient marketing spend.revenue.
Interest expense
Interest expense relates to interest on the ANGI Group Senior Notes.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (In thousands) |
Interest expense | $ | 5,037 | | | $ | 7 | | | —% | | $ | 5,030 | | | $ | 15,100 | | | $ | 22 | | | —% | | $ | 15,078 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2024 | | 2023 | | $ Change | | % Change | | | | | | | | |
| (In thousands) |
Interest expense | $ | (5,038) | | | $ | (5,029) | | | $ | (9) | | | —% | | | | | | | | |
For the three and nine months ended September 30, 2023 compared to the three and nine months ended September 30, 2022
Interest expense was flat compared to the three and nine months ended September 30, 2022.first quarter of 2023.
Other income, (expense), net
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (In thousands) |
Other income (expense), net | $ | 3,891 | | | $ | 6,187 | | | NM | | $ | (2,296) | | | $ | 12,890 | | | $ | 17,327 | | | NM | | $ | (4,437) | |
For the three months ended September 30, 2023 and 2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended March 31, | | |
| 2024 | | 2023 | | $ Change | | % Change | | | | | | | | |
| (In thousands) |
Other income, net | $ | 4,484 | | | $ | 3,807 | | | $ | 677 | | | 18% | | | | | | | | |
Other income, (expense), net for the three months ended September 30,March 31, 2024 and 2023 primarily includes interest income of $4.9 million, partially offset by a foreign currency exchange loss of $1.0 million.
Other income (expense), net for the three months ended September 30, 2022 primarily includes a foreign currency exchange loss of $3.9 million, partially offset by interest income of $1.6 million.
For the nine months ended September 30, 2023 and 2022
Other income (expense), net for the nine months ended September 30, 2023 primarily includes interest income of $12.4$4.7 million and a foreign currency exchange gain$3.4 million, respectively.
Other income (expense), net for the nine months ended September 30, 2022 primarily includes foreign currency losses of $6.6 million, partially offset by interest income of $2.1 million.
Income tax benefitprovision
| | Three Months Ended September 30, | | Nine Months Ended September 30, |
| 2023 | | $ Change | | % Change | | 2022 | | 2023 | | $ Change | | % Change | | 2022 |
| (Dollars in thousands) |
Income tax benefit | $ | 5,967 | | | $ | 5,022 | | | 531% | | $ | 945 | | | $ | 4,705 | | | $ | (5,988) | | | (56)% | | $ | 10,693 | |
| Three Months Ended March 31, | |
| Three Months Ended March 31, | |
| Three Months Ended March 31, | |
| 2024 | |
| 2024 | |
| 2024 | |
| (Dollars in thousands) | |
| (Dollars in thousands) | |
| (Dollars in thousands) | |
Income tax provision | |
Effective income tax rate | Effective income tax rate | 53% | | 5% | | 12% | | 13% |
Effective income tax rate | |
Effective income tax rate | |
For the three months ended September 30, 2023 compared to the three months ended September 30, 2022
In 2023,2024, the Company recorded a benefitan income tax provision due primarily to benefits related to a change in the annual expected effective income tax rate, research credits, and a reconciliation of income tax provision accruals to tax returns, partially offset by tax shortfalls generated by the vesting for stock-based awards.
In 2022, the effective income tax rate was lower than the statutory rate of 21% due primarily to tax shortfalls generated by the vesting and exerciseimpact of stock-based awards and provisions related to a change in the annual expected effective income tax rate driven by unrecognized state tax losses.
For the nine months ended September 30, 2023 compared to the nine months ended September 30, 2022
In 2023, the effective income tax rate was lower than the statutory rate of 21% due primarily to tax shortfalls generated by the vesting and exercise for stock-based awards and nondeductible stock-based compensation,unbenefited losses, partially offset by research credits.
In 2022,2023, the effectiveCompany recorded an income tax rate was lower than the statutory rate of 21%provision, despite a pre-tax loss, due primarily to tax shortfalls generated by the vesting and exercise of stock-based awards and nondeductible stock-based compensation expense.and foreign income taxed at different rates, partially offset by research credits.
PRINCIPLES OF FINANCIAL REPORTING
We report Adjusted EBITDA as a supplemental measure to U.S. generally accepted accounting principles (“GAAP”). This measure is considered our primary segment measure of profitability and one of the primary metrics by which we evaluate the performance of our businesses, and on which our internal budgets are based and may also impact management compensation. We believe that investors should have access to, and we are obligated to provide, the same set of tools that we use in analyzing our results. This non-GAAP measure should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. We endeavor to compensate for the limitations of the non-GAAP measure presented by providing the comparable GAAP measure with equal or greater prominence and descriptions of the reconciling items, including quantifying such items, to derive the non-GAAP measure. We encourage investors to examine the reconciling adjustments between the GAAP and non-GAAP measure, which we discuss below.
Definition of Non-GAAP Measure
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) is defined as operating income excluding: (1) stock-based compensation expense; (2) depreciation; and (3) acquisition-related items consisting of amortization of intangible assets and impairments of goodwill and intangible assets, if applicable. We believe this measure is useful for analysts and investors as this measure allows a more meaningful comparison between our performance and that of our competitors. Adjusted EBITDA has certain limitations because it excludes the impact of these expenses.
The following table reconciles net loss attributable to Angi Inc. shareholders to operating lossincome (loss) to consolidated Adjusted EBITDA:
| | |
| |
| |
| |
| |
| | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | 2023 | | 2022 | | 2023 | | 2022 |
| | (In thousands) | (In thousands) |
Net loss attributable to Angi Inc. shareholders | Net loss attributable to Angi Inc. shareholders | $ | (5,356) | | | $ | (17,479) | | | $ | (35,380) | | | $ | (75,102) | |
Add back: | Add back: | |
Add back: | |
Add back: | |
Net earnings attributable to noncontrolling interests | Net earnings attributable to noncontrolling interests | 69 | | | 40 | | | 614 | | | 379 | |
| Income tax benefit | (5,967) | | | (945) | | | (4,705) | | | (10,693) | |
Other (income) expense, net | (3,891) | | | 2,296 | | | (12,890) | | | 4,437 | |
Net earnings attributable to noncontrolling interests | |
Net earnings attributable to noncontrolling interests | |
Loss from discontinued operations, net of tax | |
Loss from discontinued operations, net of tax | |
Loss from discontinued operations, net of tax | |
Income tax provision | |
Income tax provision | |
Income tax provision | |
Other income, net | |
Other income, net | |
Other income, net | |
Interest expense | Interest expense | 5,037 | | | 5,030 | | | 15,100 | | | 15,078 | |
Operating loss | (10,108) | | | (11,058) | | | (37,261) | | | (65,901) | |
Interest expense | |
Interest expense | |
Operating income (loss) | |
Operating income (loss) | |
Operating income (loss) | |
Add back: | |
Add back: | |
Add back: | Add back: | |
Stock-based compensation expense | Stock-based compensation expense | 10,741 | | | 12,376 | | | 33,748 | | | 38,778 | |
Stock-based compensation expense | |
Stock-based compensation expense | |
Depreciation | |
Depreciation | |
Depreciation | Depreciation | 22,596 | | | 17,759 | | | 70,210 | | | 45,112 | |
Amortization of intangibles | Amortization of intangibles | 2,633 | | | 3,805 | | | 7,958 | | | 11,413 | |
Amortization of intangibles | |
Amortization of intangibles | |
Adjusted EBITDA | Adjusted EBITDA | $ | 25,862 | | | $ | 22,882 | | | $ | 74,655 | | | $ | 29,402 | |
Adjusted EBITDA | |
Adjusted EBITDA | |
Non-Cash Expenses That Are Excluded from Our Non-GAAP Measure
Stock-based compensation expense consists of expense associated with the grants, including unvested grants assumed in acquisitions, of stock appreciation rights, restricted stock units (“RSUs”), stock options, performance-based RSUs (“PSUs”) and market-based awards. These expenses are not paid in cash and we view the economic costs of stock-based awards to be the dilution to our share base; we also include the related shares in our fully diluted shares outstanding for GAAP earnings per share using the treasury stock method. PSUs and market-based awards are included only to the extent the applicable performance or market condition(s) have been met (assuming the end of the reporting period is the end of the contingency period). The Company is currently settling all stock-based awards on a net basis and remits the required tax-withholding amounts from its current funds.
Depreciation is a non-cash expense relating to our capitalized software, leasehold improvements and equipment and is computed using the straight-line method to allocate the cost of depreciable assets to operations over their estimated useful lives, or, in the case of leasehold improvements, the lease term, if shorter.
Amortization of intangible assets and impairments of goodwill and intangible assets are non-cash expenses related primarily to acquisitions. At the time of an acquisition, the identifiable definite-lived intangible assets of the acquired company, such as service professional relationships, technology, and trade names, are valued and amortized over their estimated lives. Value is also assigned to acquired indefinite-lived intangible assets, which comprise trade names and trademarks, and goodwill that are not subject to amortization. An impairment is recorded when the carrying value of an intangible asset or goodwill exceeds its fair value. We believe that intangible assets represent costs incurred by the acquired company to build value prior to acquisition and the related amortization and impairments of intangible assets or goodwill, if applicable, are not ongoing costs of doing business.
FINANCIAL POSITION, LIQUIDITY, AND CAPITAL RESOURCES
Financial Position
| | September 30, 2023 | | December 31, 2022 |
| (In thousands) |
| | March 31, 2024 | | | | March 31, 2024 | | December 31, 2023 |
| | (In thousands) | | | | (In thousands) |
Cash and cash equivalents: | Cash and cash equivalents: | |
United States | |
United States | |
United States | United States | | $ | 359,187 | | | $ | 311,422 | |
All other countries | All other countries | | 7,638 | | | 9,733 | |
Total cash and cash equivalents | Total cash and cash equivalents | | 366,825 | | | 321,155 | |
| | Long-term debt: | Long-term debt: | |
| Long-term debt: | |
| Long-term debt: | |
ANGI Group Senior Notes | |
ANGI Group Senior Notes | |
ANGI Group Senior Notes | ANGI Group Senior Notes | | $ | 500,000 | | | $ | 500,000 | |
| Less: unamortized debt issuance costs | Less: unamortized debt issuance costs | | 4,147 | | | 4,716 | |
| Less: unamortized debt issuance costs | |
| Less: unamortized debt issuance costs | |
Total long-term debt, net | Total long-term debt, net | | $ | 495,853 | | | $ | 495,284 | |
At September 30, 2023,March 31, 2024, all of the Company’s international cash can be repatriated without significant consequences.
Cash Flow Information
In summary, the Company’s cash flows are as follows:
| | | | | | | | | | | |
| Nine Months Ended September 30, |
| 2023 | | 2022 |
| (In thousands) |
Net cash provided by (used in): | | | |
Operating activities | $ | 88,798 | | | $ | 11,358 | |
Investing activities | $ | (35,631) | | | $ | (95,297) | |
Financing activities | $ | (8,234) | | | $ | (13,731) | |
| | | | | | | | | | | |
| Three Months Ended March 31, |
| 2024 | | 2023 |
| (In thousands) |
Net cash provided by (used in): | | | |
Operating activities attributable to continuing operations | $ | 22,296 | | | $ | 21,172 | |
Investing activities attributable to continuing operations | $ | (12,792) | | | $ | (24,214) | |
Financing activities attributable to continuing operations | $ | (10,074) | | | $ | (1,379) | |
Net cash provided by operating activities attributable to continuing operations consists of earnings adjusted for non-cash items and the effect of changes in working capital. Non-cash adjustments include depreciation, provision for credit losses, stock-based compensation expense, non-cash lease expense (including impairment of right-of-use assets), deferred income taxes, and amortization of intangibles, and deferred income taxes.intangibles.
20232024
Adjustments to net loss attributable to continuing operations consist primarily of $70.2$23.8 million of depreciation, $67.3$15.9 million of provision for credit losses, $33.7$9.4 million of stock-based compensation expense, $9.6$4.8 million of non-cash lease expense (including impairment of right-of-use assets), and $8.0$1.3 million of amortization of intangibles.deferred income taxes. The decrease from changes in working capital consists primarily of an increase of $50.7$25.8 million in accounts receivable a decreaseand decreases of $17.4 million in operating lease liabilities, and an increase of $13.5 million in accounts payable and other liabilities.liabilities and $4.5 million in operating lease liabilities, partially offset by a decrease of $13.3 million of other assets. The increase in accounts receivable is due primarily to timing of cash receipts. The decrease in accounts payable and other liabilities is due primarily to payments for accrued compensation. The decrease in operating lease liabilities is due to cash payments on leases net of interest accretion. The increasedecrease in accounts payable and other liabilitiesassets is due in part,primarily to timingthe receipt of payments.an insurance claim from coverage for previously incurred legal fees.
Net cash used in investing activities attributable to continuing operations includes capital expenditures of $36.1$12.8 million primarily related to investments in capitalized software to support the Company’s products and services and purchases of marketable debt securities of $12.4 million, partially offset by maturities of marketable debt securities of $12.5 million.services.
Net cash used in financing activities attributable to continuing operations includes $4.8 million for the payment of withholding taxes on behalf of employees for stock-based awards that were net settled and $3.4$6.9 million for the repurchase of 1.12.9 million shares of Angi Inc. Class A common stock, on a settlement date basis, at an average price of $3.22$2.37 per share.share and $3.2 million for the payment of withholding taxes on behalf of employees for stock-based awards that were net settled.
20222023
Adjustments to net loss attributable to continuing operations consist primarily of $82.2$25.2 million of depreciation, $23.7 million of provision for credit losses, $45.1 million of depreciation, $38.8$12.7 million of stock-based compensation expense, $11.5$3.5 million of non-cash lease expense (including impairment of right-of-use assets), and $11.4$2.7 million of amortization of intangibles, partially offset by deferred income taxes of $14.0 million.intangibles. The decrease from changes in working capital consists primarily of an increase of $102.4$22.4 million in accounts receivable an increaseand decreases of $10.0 million in other assets, and a decrease of $13.2 million in operating lease liabilities, partially offset by increases of $26.7$10.3 million in accounts payable and other liabilities and $4.6 million in operating lease liabilities. The increase in accounts receivable is due primarily to revenue growth, primarily attributabletiming of cash receipts for credit card transactions. The decrease in accounts payable and other liabilities is due, in part, to Services. The increase in other assets is primarily due to an increase in capitalized sales commissions.payments for accrued compensation. The decrease in operating lease liabilities is due to cash payments on leases net of interest accretion. The increase in accounts payable and other liabilities is primarily due to increases in accrued expenses related to the 2021 brand integration initiative and accrued roofing material costs related to Roofing.
Net cash used in investing activities attributable to continuing operations includes $95.5$12.4 million of purchases of marketable debt securities and $11.9 million of capital expenditures, primarily related to investments in capitalized software to support the Company’s products and services.
Net cash used in financing activities attributable to continuing operations includes $8.1 million for the repurchase of 1.0 million shares of Angi Inc. Class A common stock, on a settlement date basis, at an average price of $7.80 per share and $5.6$1.4 million for the payment of withholding taxes on behalf of employees for stock-based awards that were net settled.
Discontinued Operations
Net cash used in discontinued operations of $2.1 million for the three months ended March 31, 2023 relates to the operations for THR. The Company does not expect cash flows from discontinued operations following the sale of THR.
Liquidity and Capital Resources
Share Repurchase Authorizations and Activity
During the ninethree months ended September 30, 2023,March 31, 2024, the Company repurchased 1.12.8 million shares of its Class A common stock, on a trade date basis, of its common stock at an average price of $3.22$2.37 per share, or $3.4$6.7 million in aggregate. During the fourth quarter of 2023, Angi Inc. announced its intent to utilize the remaining 14.0 million shares in its stock repurchase authorization. From April 1, 2024 through May 3, 2024 the Company repurchased an additional 3.1 million shares at an average price of $2.22 per share, or $6.8 million in aggregate. The Company had 14.04.7 million shares remaining in its share repurchase authorization as of NovemberMay 3, 2023. 2024.
The Company may purchase its shares pursuant to its authorization over an indefinite period of time in the open market and in privately negotiated transactions, depending on those factors the Company’s management deems relevant at any particular time, including, without limitation, market conditions, share price and future outlook.
As of the date of this filing, the Company intends to put in place a share repurchase plan with the intent of utilizing the full 14.0 million shares remaining in its stock repurchase authorization. The plan will be subject to price and volume limitations.
Outstanding Stock-based Awards
The Company may settle equity awards on a gross or a net basis depending upon factors deemed relevant at the time, and if settledon a net basis, Angi remits withholding taxes on behalf of the employee. At IAC’s option, certain Angi stock appreciation rights can be settled in either Class A shares of Angi or shares of IAC common stock. If settled in IAC common stock, the Company reimburses IAC in either cash or through the issuance of Class A shares to IAC. The Company currently settles all equity awards on a net basis.
Pursuant to the employee matters agreement, in the event of a distribution of Angi capital stock to IAC stockholders in a transaction intended to qualify as tax-free for U.S. federal income tax purposes, the Compensation Committee of the IAC Board of Directors has the exclusive authority to determine the treatment of outstanding IAC equity awards. Such authority includes (but is not limited to) the ability to convert all or part of IAC equity awards outstanding immediately prior to the distribution into equity awards denominated in shares of Angi Class A Common Stock for no compensation, which Angi would be obligated to assume and which would be dilutive to Angi’s stockholders.
The following table summarizes the aggregate intrinsic value of all awards outstanding as of November 3, 2023;assuming these awards were net settled on that date, the withholding taxes that would be paid by the Company on behalf of employees upon exercise or vesting that would be payable (assuming these equity awards are net settled with a 50% tax rate), and the shares that would have been issued are as follows:
| | | | | | | | | | | | | | | | | |
| Aggregate intrinsic value of awards outstanding | | Estimated withholding taxes payable | | Estimated shares to be issued |
| (In thousands) |
| | | | | |
| | | | | |
RSUs and other equity awards(a)(b) | 42,262 | | | 20,356 | | | 13,117 | |
Total outstanding employee stock-based awards | $ | 42,262 | | | $ | 20,356 | | | 13,117 | |
_______________(a)Includes stock options and subsidiary denominated equity.
(b)The number of shares ultimately needed to settle subsidiary denominated equity awards and the cash withholding tax obligation may vary significantly as a result of the determination of the fair value of the relevant award at the time of exercise. In addition, the number of shares required to settle these awards will be impacted by movement in the Company’s stock price.
Contractual Obligations
At September 30, 2023,March 31, 2024, there have been no material changes outside the ordinary course of business to the Company's contractual obligations since the disclosures made for the year ended December 31, 2022,2023, included in the Company's Annual Report on Form 10-K.
Capital Expenditures
The Company’s 20232024 capital expenditures are expected to be lowerhigher than 20222023 capital expenditures of $116.4$47.8 million by approximately 55%15% to 30%, due primarily to decreased investmentan increase in capitalized software.the capitalization rate of software development projects.
Liquidity Assessment
The Company’s liquidity could be negatively affected by a decrease in demand for its products and services due to economic or other factors.
At September 30, 2023,March 31, 2024, IAC held all Class B shares of Angi Inc., which represent 83.8%84.3% of the economic interest and 98.1%98.2% of the voting interest of the Company. As a result, IAC has the ability to control Angi’s financing activities, including the issuance of additional debt and equity securities by Angi or any of its subsidiaries, or the incurrence of other indebtedness generally. While Angi is expected to have the ability to access debt and equity markets if needed, such transactions may require the
approval of IAC due to its control of the majority of the outstanding voting power of Angi’s capital stock and its representation on the Angi board of directors.
The Company believes its existing cash, cash equivalents, and expected positive cash flows generated from operations will be sufficient to fund its normal operating requirements, including capital expenditures, debt service, the payment of withholding taxes paid on behalf of employees for net-settled stock-based awards, and investing and other commitments, for the next twelve months. We may elect to raise additional capital through the sale of additional equity or debt financing to fund business activities such as strategic acquisitions, share repurchases, or other purposes beyond the next twelve months.
Additional financing may not be available on terms favorable to the Company or at all, and may also be impacted by any disruptions in the financial markets. In addition, the Company’s existing indebtedness could limit its ability to obtain additional financing.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
During the ninethree months ended September 30, 2023,March 31, 2024, there have been no material changes to the Company’s instruments or positions that are sensitive to market risk since the disclosure in our Annual Report on Form 10-K for the year ended December 31, 2022.
2023.
Item 4. Controls and Procedures
As required by Rule 13a-15(b) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), management, including our Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), conducted an evaluation, as of the end of the period covered by this quarterly report, of the effectiveness of the Company's disclosure controls and procedures as defined by Rule 13a-15(e) under the Exchange Act. Based on this evaluation, our CEO and CFO concluded that the Company's disclosure controls and procedures were effective as of the end of the period covered by this quarterly report.
The Company monitors and evaluates on an ongoing basis its disclosure controls and procedures and internal control over financial reporting in order to improve theirits overall effectiveness. DuringIn the course of these evaluations, the Company modifies and refines its internal processes as conditions warrant.
As required by Rule 13a-15(b) underDuring the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Company’s management, including our principal executive and principal financial officers, or persons performing similar functions, evaluated the effectiveness of the Company’s disclosure controls and procedures as defined by Rule 13a-15(e) under the Exchange Act. Based on this evaluation, management has concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report in providing reasonable assurance that information we are required to disclose in our filings with the Securities and Exchange Commission (the “Commission:) under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms, and include controls and procedures designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal financial officers, as appropriate to allow timely decisions regarding required disclosure.
There werequarter ended March 31, 2024, there have been no changes to the Company’sour internal control over financial reporting during the period covered by this report that have materially affected, or are reasonably likely to materially affect, ourthe Company's internal control over financial reporting.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
Overview
In the ordinary course of business, the Company and its subsidiaries are (or may become) parties to claims, suits, regulatory and government investigations, and other proceedings involving property, personal injury, intellectual property, privacy, tax, labor and employment, competition, commercial disputes, consumer protection and other claims, as well as stockholder derivative actions, class action lawsuits and other matters. Such claims, suits, regulatory and government investigations, and other proceedings could result in fines, civil or criminal penalties, or other adverse consequences. The amounts that may be recovered in such matters may be subject to insurance coverage. Although the results of legal proceedings and claims cannot be predicted with certainty, neither the Company nor any of its subsidiaries is currently a party to any legal proceedings the outcome of which, we believe, if determined adversely to us, would individually or in the aggregate have a material adverse effect on our business, financial condition or results of operations. However, the outcome of such matters is inherently unpredictable and subject to significant uncertainties.
Rules of the Commission require the description of material pending legal proceedings (other than ordinary, routine litigation incident to the registrant’s business) and advise that proceedings ordinarily need not be described if they primarily involve damages claims for amounts (exclusive of interest and costs) not exceeding 10% of the current assets of the registrant and its subsidiaries on a consolidated basis. In the judgment of Company management, none of the pending litigation matters which we are defending, including those described below, involves or is likely to involve amounts of that magnitude. The matters described below involve issues or claims that may be of particular interest to our stockholders, regardless of whether they may be material to our financial position or operations based upon the standard set forth in the rules of the Commission.
Service Professional Class Action Litigation against HomeAdvisor
In July 2016, a putative class action, Airquip, Inc. et al. v. HomeAdvisor, Inc. et al., No. 1:16-cv-1849, was filed in the U.S. District Court for the District of Colorado. The complaint, as amended in November 2016, alleged that HomeAdvisor engages in certain deceptive practices affecting the SPs who join its network, including charging them for substandard customer leads and failing to disclose certain charges. The complaint sought certification of a nationwide class consisting of all HomeAdvisor SPs since October 2012, asserted claims for fraud, breach of implied contract, unjust enrichment and violation of the federal RICO statute and the Colorado Consumer Protection Act, and sought injunctive relief and damages in an unspecified amount.
In July 2018, plaintiffs’ counsel filed a separate putative class action in the U.S. District Court for the District of Colorado, Costello et al. v. HomeAdvisor, Inc. et al., No. 1:18-cv-1802, on behalf of the nine SPs also proposed as new plaintiffs in the Airquip case, naming as defendants HomeAdvisor, Angi and IAC (as well as an unrelated company), and asserting 45 claims largely duplicative of those asserted in a proposed second amended complaint in the Airquip case. In November 2018, the judge presiding over the Airquip case issued an order consolidating the two cases to proceed before him under the caption In re HomeAdvisor, Inc. Litigation.
In September 2019, the court grantedissued an order granting the plaintiffs’ renewed motion for leave to file a consolidated second amended complaint, naming as defendants, in addition to HomeAdvisor, Angithe Company and IAC, CraftJack, Inc. (a wholly-owned subsidiary of the Company) and two unrelated entities. In October and December 2019, the four defendants affiliated with HomeAdvisor filed motions to dismiss certain claims in the amended complaint. In September 2020, the court issued an order granting in part and denying in part the defendants’ motions to dismiss; the court’s dismissal of the RICO claim was with prejudice as to all the defendants.dismiss. In May 2022, the plaintiffs filed a motion for class certification; the defendants opposed the motion. On January 10, 2024, the court entered an order largely denying plaintiffs’ motion for class certification. In June 2022,While the Companycourt certified certain classes seeking only injunctive relief based upon alleged misappropriation of SPs’ intellectual property, the court declined to certify any of the proposed classes challenging lead quality and seeking monetary relief. On January 24, 2024, the plaintiffs filed a motion for reconsideration of the court’s partial denial of class certification; on February 14, 2024, the defendants opposed the motion, which remains pending. On February 26, 2024, the parties filed cross-motions for summary judgement on the remaining class claim regarding misappropriation of SPs’ intellectual property.
The Company believes that the allegations in this lawsuit are without merit and will continue to defend vigorously against them.
Item 1A. Risk Factors
This quarterly report on Form 10-Q contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The use of words such as “anticipates,” “estimates,” “expects,” “plans,” “intends,” “will continue,” “may”, “could” and “believes,” among similar expressions, generally identify forward-looking statements. These forward-looking statements include, among others, statements relating to our future business, financial condition, results of operations and financial performance, our business prospects and strategy, trends and prospects in the home services industry and other similar matters. These forward-looking statements are based on Company management'sthe expectations and assumptions
our management about future events as of the date of this report, which are inherently subject to uncertainties, risks and changes in circumstances that are difficult to predict.
Actual results could differ materially from those contained in these forward-looking statements for a variety of reasons, including, among others: (i) the continued migration of the home services market online, (ii) our ability to market our various products and services in a successful and cost-effective manner, (iii) the continued display of links to websites offering our products and services in a prominent manner in search results, (iv) our ability to successfully implementexpand our brand initiative and expand Services (our pre-priced offerings),offerings while balancing the overall mix of service requests and directory services on Angi platforms, (v) our ability to establish and maintain relationships with quality and trustworthy service professionals, (vi) our continued ability to develop and monetize versions of our products and services for mobile and other digital devices, (vii) our ability to access, share and use personal data about consumers, (viii) our continued ability to communicate with consumers and service professionals via e-mail (or other sufficient means), (xix)(ix) our ability to continue to generate leads for service professionals given changing requirements applicable to certain communications with consumers, (x) any challenge to the contractor classification or employment status of our service professionals, (x)(xi) our ability to compete, (xi)(xii) adverse economic events or trends (particularly those that impact consumer confidence and spending behavior), (xii)(xiii) our ability to build, maintain and/or enhance our various brands, (xiii) the adverse impact of COVID-19 and other similar outbreaks on our businesses, (xiv) our ability to protect our systems, technology and infrastructure from cyberattacks and to protect personal and confidential user information (including credit card information), as well as the impact of cyberattacks experienced by third parties, (xv) the occurrence of data security breaches and/or fraud, (xvi) increased liabilities and costs related to the processing, storage, use and disclosure of personal and confidential user information, (xvii) the integrity, quality, efficiency and scalability of our systems, technology and infrastructures (and those of third parties with whom we do business), (xviii) changes in key personnel, (xix) various risks related to our relationship with IAC, (xx) our ability to generate sufficient cash to service our indebtedness and (xxi) certain risks related to ownership of our Class A common stock.
Certain of these and other risks and uncertainties are discussed in our filings with the SEC, including in Part I-Item 1A-Risk Factors of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022.2023. Other unknown or unpredictable factors that could also adversely affect our business, financial condition and operating results may arise from time to time. In light of these risks and uncertainties, the forward-looking statements discussed in this quarterly report may not prove to be accurate. Accordingly, you should not place undue reliance on these forward-looking statements, which only reflect the views of Company management as of the date of this quarterly report. We do not undertake to update these forward-looking statements.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Unregistered Sales of Equity Securities
The Company did not issue or sell any shares of its common stock or any other equity securities pursuant to unregistered transactions during the quarterthree months ended September 30, 2023.March 31, 2024.
Issuer Purchases of Equity Securities
The following table sets forth purchases by the Company did not purchase any shares of its Class A common stock during the quarterthree months ended September 30, 2023. AsMarch 31, 2024.
| | | | | | | | | | | | | | | | | | | | | | | |
Period | (a) Total Number of Shares Purchased | | (b) Average Price Paid Per Share | | (c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(1) | | (d) Maximum Number of Shares that May Yet Be Purchased Under Publicly Announced Plans or Programs(2) |
January 2024 | 2,247,534 | | | $ | 2.36 | | | 2,247,534 | | | 8,349,548 | |
February 2024 | 565,244 | | | $ | 2.42 | | | 565,244 | | | 7,784,304 | |
March 2024 | 15,318 | | | $ | 2.51 | | | 15,318 | | | 7,768,986 | |
Total | 2,828,096 | | | $ | 2.37 | | | 2,828,096 | | | 7,768,986 | |
(1)Reflects repurchases made pursuant to the share repurchase authorization previously announced in March 2020.
(2)Represents the total number of that date, 13,971,371 shares of Angi Class A common stock that remained available for repurchase underas of March 31, 2024 pursuant to the Company's previously announced March 2020 share repurchase authorization.authorizations. The Company may repurchase shares pursuant to this share repurchase authorization over an indefinite period of time in the open market and in privately negotiated transactions, depending on those factors Company management deems relevant at any particular time, including, without limitation, market conditions, share price and future outlook.
From April 1, 2024 through May 3, 2024, the Company repurchased an additional 3,050,049 shares at an average price of $2.22 per share. As of the date of this filing, the Company intends to put in place a share repurchase plan with the intent of utilizing the full 13,971,371May 3, 2024, there were approximately 4.7 million shares remaining in its stockthe March 2020 share repurchase authorization. The plan will be subject to price and volume limitations.
Item 5. Other Information
Rule 10b5-1 Trading Plans
On August 15, 2023, Kulesh Shanmugasundaram, an officer of the Company (Chief Technology Officer), adopted a Rule 10b5-1 trading plan that provides for the sale of up to 48,000 shares of Angi Class A common stock and all of the net shares of Angi Class A common stock acquired upon the vesting of up to 200,000 restricted stock units scheduled to vest on March 1, 2024, subject to continued service (the “Plan”). Sales pursuant to the Plan are scheduled to occur (assuming the satisfaction of the applicable price and other conditions set forth in the Plan) during the period commencing on November 14, 2023 and ending on August 30, 2024, absent the earlier amendment or termination of the Plan in accordance with its terms. The Plan is intended to qualify for the affirmative defense of Rule 10b5-1.
No other director or officer of the Company adopted or terminated a Rule 10b5-1 trading plan or non-Rule 10b5-1 trading arrangement (as such term is defined in Item 408(a) of Regulation S-K) during the quarterthree months ended September 30, 2023. March 31, 2024.
Item 6. Exhibits
The documents set forth below, numbered in accordance with Item 601 of Regulation S-K, are filed herewith, incorporated by reference to the location indicated or furnished herewith.
| | | | | | | | | | | | | | | | | |
Exhibit Number | | | Description | | Location |
3.1 | | | Amended and Restated Certificate of Incorporation of ANGI Homeservices Inc. | | |
3.2 | | | | Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Angi Inc.
| | |
3.3 | | | | Amended and Restated Bylaws of Angi Inc. | | |
10.1 | | | Amendment to Employment Agreement between Angi Inc. and Jeffrey W. Kip, dated as of April 5, 2024. | | |
| | | Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(1) | | |
| | | Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(1) | | |
| | | Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(2) | | |
| | | Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.(2) | | |
101.INS | | | Inline XBRL Instance (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) | | |
101.SCH | | | Inline XBRL Taxonomy Extension Schema(1) | | |
101.CAL | | | Inline XBRL Taxonomy Extension Calculation(1) | | |
101.DEF | | | Inline XBRL Taxonomy Extension Definition(1) | | |
101.LAB | | | Inline XBRL Taxonomy Extension Labels(1) | | |
101.PRE | | | Inline XBRL Taxonomy Extension Presentation(1) | | |
104 | | | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | | |
(1)Filed herewith.
(2)Furnished herewith.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | | | | | | | | | | | | | |
Dated: | NovemberMay 7, 20232024 | | | |
| | Angi Inc. |
| | | | |
| | By: | | /s/ ANDREW RUSSAKOFF |
| | | | Andrew Russakoff |
| | | | Chief Financial Officer |
| | | | | | | | |
| | |
Signature | Title | Date |
| | |
/s/ ANDREW RUSSAKOFF | Chief Financial Officer | NovemberMay 7, 20232024 |
Andrew Russakoff | | |