Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2022 | Jul. 29, 2022 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 001-39671 | |
Entity Registrant Name | MediaAlpha, Inc. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 85-1854133 | |
Entity Address, Address Line One | 700 South Flower Street | |
Entity Address, Address Line Two | Suite 640 | |
Entity Address, City or Town | Los Angeles | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90017 | |
City Area Code | 213 | |
Local Phone Number | 316-6256 | |
Title of 12(b) Security | Class A Common Stock, $0.01 par value per share | |
Trading Symbol | MAX | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0001818383 | |
Current Fiscal Year End Date | --12-31 | |
Class A Common | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 42,125,835 | |
Class B Common | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 19,170,493 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Current assets | ||
Cash and cash equivalents | $ 35,194 | $ 50,564 |
Accounts receivable, net of allowance for credit losses of $374 and $609, respectively | 38,856 | 76,094 |
Prepaid expenses and other current assets | 6,359 | 10,448 |
Total current assets | 80,409 | 137,106 |
Intangible assets, net | 36,327 | 12,567 |
Goodwill | 47,739 | 18,402 |
Deferred tax asset | 103,008 | 102,656 |
Other assets | 18,395 | 19,073 |
Total assets | 285,878 | 289,804 |
Current liabilities | ||
Accounts payable | 33,434 | 61,770 |
Accrued expenses | 13,204 | 13,716 |
Current portion of long-term debt | 8,749 | 8,730 |
Total current liabilities | 55,387 | 84,216 |
Long-term debt, net of current portion | 198,686 | 178,069 |
Liabilities under tax receivables agreement, net of current portion | 83,279 | 85,027 |
Other long-term liabilities | 7,999 | 4,058 |
Total liabilities | 345,351 | 351,370 |
Commitments and contingencies | ||
Stockholders' equity (deficit): | ||
Preferred stock, $0.01 par value - 50 million shares authorized; 0 shares issued and outstanding as of June 30, 2022 and December 31, 2021 | 0 | 0 |
Additional paid-in capital | 443,514 | 419,533 |
Accumulated deficit | (440,691) | (424,476) |
Total stockholders' equity (deficit) attributable to MediaAlpha, Inc. | 3,437 | (4,337) |
Non-controlling interests | (62,910) | (57,229) |
Total stockholders' (deficit) | (59,473) | (61,566) |
Total liabilities and stockholders' deficit | 285,878 | 289,804 |
Class A Common | ||
Stockholders' equity (deficit): | ||
Common stock | 422 | 410 |
Class B Common | ||
Stockholders' equity (deficit): | ||
Common stock | $ 192 | $ 196 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income Statement [Abstract] | ||||
Revenue | $ 103,449 | $ 157,353 | $ 246,048 | $ 330,941 |
Costs and operating expenses | ||||
Cost of revenue | 87,925 | 132,305 | 208,806 | 279,485 |
Sales and marketing | 7,958 | 5,724 | 15,181 | 11,115 |
Product development | 5,661 | 3,840 | 10,877 | 7,160 |
General and administrative | 12,316 | 13,585 | 29,464 | 29,334 |
Total costs and operating expenses | 113,860 | 155,454 | 264,328 | 327,094 |
(Loss) income from operations | (10,411) | 1,899 | (18,280) | 3,847 |
Other expenses (income), net | 44 | 171 | (479) | 21 |
Interest expense | 1,956 | 2,237 | 3,315 | 4,538 |
Total other expense, net | 2,000 | 2,408 | 2,836 | 4,559 |
(Loss) before income taxes | (12,411) | (509) | (21,116) | (712) |
Income tax expense (benefit) | 611 | (125) | 1,754 | (489) |
Net (loss) | (13,022) | (384) | (22,870) | (223) |
Net (loss) attributable to non-controlling interest | (3,883) | (177) | (6,655) | (301) |
Net (loss) income attributable to MediaAlpha, Inc. | $ (9,139) | $ (207) | $ (16,215) | $ 78 |
Net (loss) income per share of Class A common stock | ||||
Basic (in dollars per share) | $ (0.22) | $ (0.01) | $ (0.39) | $ 0 |
Diluted (in dollars per share) | $ (0.22) | $ (0.01) | $ (0.39) | $ 0 |
Weighted average shares of Class A common stock outstanding | ||||
Basic (in shares) | 41,705,344 | 37,667,432 | 41,279,146 | 35,414,548 |
Diluted (in shares) | 41,705,344 | 37,667,432 | 41,279,146 | 35,414,548 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity (Deficit) - USD ($) $ in Thousands | Total | Common Stock Class A common stock | Common Stock Class B common stock | Additional Paid-In- Capital | Accumulated deficit | Non- Controlling Interest |
Beginning balance (in shares) at Dec. 31, 2020 | 33,371,056 | 25,536,043 | ||||
Beginning balance at Dec. 31, 2020 | $ (105,118) | $ 334 | $ 255 | $ 384,611 | $ (418,973) | $ (71,345) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Establishment of liabilities under tax receivables agreement and related changes to deferred tax assets associated with increases in tax basis | 6,190 | 6,190 | ||||
Exchange of non-controlling interest for Class A common stock (in shares) | 4,457,796 | (4,457,796) | ||||
Exchange of non-controlling interest for Class A common stock | 0 | $ 45 | $ (45) | (12,716) | 12,716 | |
Vesting of restricted stock units (in shares) | 444,030 | |||||
Vesting of restricted stock units | 0 | $ 4 | (4) | |||
Equity-based compensation | 10,603 | 10,479 | 124 | |||
Forfeiture of equity awards (in shares) | (58,608) | |||||
Forfeiture of equity awards | (1) | $ (1) | ||||
Shares withheld on tax withholding on vesting of restricted stock units | (1,276) | (1,276) | ||||
Net (loss) | 161 | 285 | (124) | |||
Ending balance (in shares) at Mar. 31, 2021 | 38,214,274 | 21,078,247 | ||||
Ending balance at Mar. 31, 2021 | (89,441) | $ 382 | $ 210 | 387,284 | (418,688) | (58,629) |
Beginning balance (in shares) at Dec. 31, 2020 | 33,371,056 | 25,536,043 | ||||
Beginning balance at Dec. 31, 2020 | (105,118) | $ 334 | $ 255 | 384,611 | (418,973) | (71,345) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) | (223) | |||||
Ending balance (in shares) at Jun. 30, 2021 | 38,709,784 | 21,040,999 | ||||
Ending balance at Jun. 30, 2021 | (79,258) | $ 387 | $ 210 | 397,710 | (418,895) | (58,670) |
Beginning balance (in shares) at Mar. 31, 2021 | 38,214,274 | 21,078,247 | ||||
Beginning balance at Mar. 31, 2021 | (89,441) | $ 382 | $ 210 | 387,284 | (418,688) | (58,629) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Establishment of liabilities under tax receivables agreement and related changes to deferred tax assets associated with increases in tax basis | 54 | 54 | ||||
Exchange of non-controlling interest for Class A common stock (in shares) | 37,248 | (37,248) | ||||
Exchange of non-controlling interest for Class A common stock | 0 | (106) | 106 | |||
Vesting of restricted stock units (in shares) | 458,262 | |||||
Vesting of restricted stock units | 0 | $ 5 | (5) | |||
Equity-based compensation | 11,521 | 11,381 | 140 | |||
Shares withheld on tax withholding on vesting of restricted stock units | (898) | (898) | ||||
Distributions to non-controlling interests | (110) | (110) | ||||
Net (loss) | (384) | (207) | (177) | |||
Ending balance (in shares) at Jun. 30, 2021 | 38,709,784 | 21,040,999 | ||||
Ending balance at Jun. 30, 2021 | (79,258) | $ 387 | $ 210 | 397,710 | (418,895) | (58,670) |
Beginning balance (in shares) at Dec. 31, 2021 | 40,969,952 | 19,621,915 | ||||
Beginning balance at Dec. 31, 2021 | (61,566) | $ 410 | $ 196 | 419,533 | (424,476) | (57,229) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Establishment of liabilities under tax receivables agreement and related changes to deferred tax assets associated with increases in tax basis | 19 | 19 | ||||
Exchange of non-controlling interest for Class A common stock (in shares) | 60,197 | (60,197) | ||||
Exchange of non-controlling interest for Class A common stock | 0 | (180) | 180 | |||
Vesting of restricted stock units (in shares) | 593,810 | |||||
Vesting of restricted stock units | 0 | $ 6 | (6) | |||
Equity-based compensation | 13,773 | 13,688 | 85 | |||
Forfeiture of equity awards (in shares) | (23,294) | |||||
Shares withheld on tax withholding on vesting of restricted stock units | (820) | (820) | ||||
Distributions to non-controlling interests | (130) | (130) | ||||
Settlement of 2021 annual bonus as restricted stock units | 880 | 880 | ||||
Tax impact of changes in investment in partnership | 43 | 43 | ||||
Net (loss) | (9,848) | (7,076) | (2,772) | |||
Ending balance (in shares) at Mar. 31, 2022 | 41,600,665 | 19,561,718 | ||||
Ending balance at Mar. 31, 2022 | (57,649) | $ 416 | $ 196 | 433,157 | (431,552) | (59,866) |
Beginning balance (in shares) at Dec. 31, 2021 | 40,969,952 | 19,621,915 | ||||
Beginning balance at Dec. 31, 2021 | $ (61,566) | $ 410 | $ 196 | 419,533 | (424,476) | (57,229) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Shares repurchased (in shares) | (321,150) | |||||
Stock repurchased during period, value | $ (3,500) | |||||
Net (loss) | (22,870) | |||||
Ending balance (in shares) at Jun. 30, 2022 | 42,237,776 | 19,170,493 | ||||
Ending balance at Jun. 30, 2022 | (59,473) | $ 422 | $ 192 | 443,514 | (440,691) | (62,910) |
Beginning balance (in shares) at Mar. 31, 2022 | 41,600,665 | 19,561,718 | ||||
Beginning balance at Mar. 31, 2022 | (57,649) | $ 416 | $ 196 | 433,157 | (431,552) | (59,866) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Establishment of liabilities under tax receivables agreement and related changes to deferred tax assets associated with increases in tax basis | 4 | 4 | ||||
Exchange of non-controlling interest for Class A common stock (in shares) | 297,747 | (297,747) | ||||
Exchange of non-controlling interest for Class A common stock | 0 | $ 3 | $ (3) | (946) | 946 | |
Vesting of restricted stock units (in shares) | 674,674 | |||||
Vesting of restricted stock units | 0 | $ 6 | (6) | |||
Equity-based compensation | 15,780 | 15,733 | 47 | |||
Forfeiture of equity awards (in shares) | (14,160) | (93,478) | ||||
Forfeiture of equity awards | 0 | $ (1) | (305) | 306 | ||
Shares withheld on tax withholding on vesting of restricted stock units | (966) | (966) | ||||
Distributions to non-controlling interests | $ (460) | (460) | ||||
Shares repurchased (in shares) | (321,150) | (321,150) | ||||
Stock repurchased during period, value | $ (3,457) | $ (3) | (3,454) | |||
Tax impact of changes in investment in partnership | 297 | 297 | ||||
Net (loss) | (13,022) | (9,139) | (3,883) | |||
Ending balance (in shares) at Jun. 30, 2022 | 42,237,776 | 19,170,493 | ||||
Ending balance at Jun. 30, 2022 | $ (59,473) | $ 422 | $ 192 | $ 443,514 | $ (440,691) | $ (62,910) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Cash flows from operating activities | |||||||
Net (loss) | $ (13,022) | $ (9,848) | $ (384) | $ 161 | $ (22,870) | $ (223) | |
Adjustments to reconcile net (loss) to net cash provided by (used in) operating activities: | |||||||
Non-cash equity-based compensation expense | 29,616 | 22,123 | |||||
Non-cash lease expense | 357 | 246 | |||||
Depreciation expense on property and equipment | 197 | 173 | |||||
Amortization of intangible assets | 1,700 | 700 | 2,360 | 1,492 | $ 2,984 | ||
Amortization of deferred debt issuance costs | 200 | 300 | 418 | 694 | |||
Change in fair value of contingent consideration | (2,845) | 0 | |||||
Credit losses | (127) | 235 | |||||
Deferred taxes | 1,630 | (865) | |||||
Tax receivable agreement liability adjustments | (589) | (156) | |||||
Changes in operating assets and liabilities: | |||||||
Accounts receivable | 38,691 | 21,775 | |||||
Prepaid expenses and other current assets | 4,057 | 2,472 | |||||
Other assets | 198 | 310 | |||||
Accounts payable | (28,354) | (51,940) | |||||
Accrued expenses | (2,845) | (2,136) | |||||
Net cash provided by (used in) operating activities | 19,894 | (5,800) | |||||
Cash flows from investing activities | |||||||
Purchases of property and equipment | (79) | (470) | |||||
Cash consideration paid in connection with CHT acquisition | (49,677) | 0 | |||||
Net cash (used in) investing activities | (49,756) | (470) | |||||
Cash flows from financing activities | |||||||
Revolving credit facility | 25,000 | 0 | |||||
Term loan facility | (4,750) | 0 | |||||
Repurchases of Class A common stock | (3,382) | 0 | |||||
Distributions | (590) | (110) | |||||
Shares withheld for taxes on vesting of restricted stock units | (1,786) | (2,174) | |||||
Net cash provided by (used in) financing activities | 14,492 | (2,284) | |||||
Net (decrease) in cash and cash equivalents | (15,370) | (8,554) | |||||
Cash and cash equivalents, beginning of period | $ 50,564 | $ 23,554 | 50,564 | 23,554 | 23,554 | ||
Cash and cash equivalents, end of period | $ 35,194 | $ 15,000 | 35,194 | 15,000 | $ 50,564 | ||
Supplemental disclosures of cash flow information | |||||||
Interest | 2,865 | 2,644 | |||||
Income taxes paid, net of refunds | (2,152) | 4 | |||||
Non-cash Investing and Financing Activities: | |||||||
Adjustments to liabilities under the tax receivable agreement | (1,619) | (53,519) | |||||
Establishment of deferred tax assets in connection with the Reorganization Transactions | (1,642) | (59,763) | |||||
Right-of-use assets obtained in exchange of lease obligations | 0 | 3,641 | |||||
Fair value of contingent consideration in connection with CHT acquisition | $ 7,007 | $ 0 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Accounts receivable, allowance for credit losses | $ 374 | $ 609 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock, issued (in shares) | 0 | 0 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Class A Common | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, issued (in shares) | 42,200,000 | 41,000,000 |
Common stock, outstanding (in shares) | 42,200,000 | 41,000,000 |
Class B Common | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, issued (in shares) | 19,200,000 | 19,600,000 |
Common stock, outstanding (in shares) | 19,200,000 | 19,600,000 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of significant accounting policies The Company's significant accounting policies are included in the 2021 Annual Report on Form 10-K and did not materially change during the six months ended June 30, 2022. Basis of presentation The accompanying unaudited consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") applicable to interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair statement of the financial position and interim results of the Company as of and for the periods presented have been included. The December 31, 2021 balance sheet data was derived from audited consolidated financial statements; however, the accompanying interim notes to the consolidated financial statements do not include all of the annual disclosures required by GAAP. Results for interim periods are not necessarily indicative of those that may be expected for a full year. The financial information included herein should be read in conjunction with the Company's consolidated financial statements and related notes in its 2021 Annual Report on Form 10-K. Revisions to previously issued consolidated financial statements On December 31, 2021, the Company adopted ASU No. 2016-02, Leases (Topic 842) effective from January 1, 2021 using the optional transition approach by applying the new standard to all leases existing at the date of initial application and prior periods were not restated. In connection with the adoption, quarterly amounts presented in the Company's prior Form 10-Q were revised. The impact of the adjustments was immaterial to the Company's consolidated financial statements. Accounts receivable Accounts receivable are net of allowances for credit losses of $0.4 million and $0.6 million as of June 30, 2022 and December 31, 2021, respectively. Concentrations of credit risk and of significant customers and suppliers Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains cash balances that can, at times, exceed amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses in these accounts, and believes it is not exposed to unusual credit risk beyond the normal credit risk in this area based on the financial strength of the institutions with which the Company maintains its deposits. The Company's accounts receivable, which are unsecured, may expose it to credit risk based on their collectability. The Company controls credit risk by investigating the creditworthiness of all customers prior to establishing relationships with them, performing periodic reviews of the credit activities of those customers during the course of the business relationship, regularly analyzing the collectability of accounts receivable, and recording allowances for credit losses. Customer concentrations consisted of one customer that accounted for approximately $13 million, or 13%, and $32 million, or 13%, of revenue for the three and six months ended June 30, 2022, respectively, compared with two customers that collectively accounted for approximately $45 million, or 28%, and $95 million, or 29%, of revenue for the three and six months ended June 30, 2021, respectively. The Company's largest customer accounted for approximately $5 million, or 13%, of total accounts receivable as of June 30, 2022, compared with approximately $7 million, or 10%, of total accounts receivable as of December 31, 2021. The Company’s supplier concentration can expose the Company to business risks. For the three and six months ended June 30, 2022, the Company had one supplier that accounted for approximately $10 million, or 10%, and $24 million, or 10%, of total purchases, respectively, compared with no supplier that accounted for more than 10% of total purchases for the three and six months ended June 30, 2021. The Company's largest supplier accounted for approximately $6 million, or 18%, of total accounts payable as of June 30, 2022, compared with the Company's two largest suppliers that collectively accounted for approximately $21 million, or 34%, of total accounts payable as of December 31, 2021. Related Party Transactions The Company is party to the tax receivables agreement ("TRA") under which it has contractually committed to pay the holders of Class B-1 units 85% of the amount of any tax benefits that the Company actually realizes, or in some cases is deemed to realize, as a result of certain transactions. During the three and six months ended June 30, 2022, payments of zero and $0.2 million, respectively were made pursuant to the TRA. The Company paid $1.3 million and $2.2 million during the three and six months ended June 30, 2022, respectively, to White Mountains related to settlement of federal and state income tax refunds for periods prior to the Reorganization Transactions. The Company recognized additional amounts reimbursable to White Mountains of $0.4 million and $0.5 million during the three and six months ended June 30, 2022, respectively. The total amount reimbursable to White Mountains was $0.5 million as of June 30, 2022 and $2.3 million as of December 31, 2021. Equity-based compensation The Company incurs equity-based compensation expense from restricted stock units (“RSUs”) and the unvested Restricted Class A shares and QLH Restricted Class B-1 units. Equity-classified awards to employees are measured and recognized in the consolidated financial statements based on the fair value of the award on the grant date and not subsequently remeasured unless modified. Liability-classified awards are measured at fair value on the grant date and remeasured at each reporting period until the award is settled. For awards subject to service conditions only, the fair value of the award on the grant date is expensed on a straight-line basis over the requisite service period of the award. The recognition period for these expenses begins at either the applicable service inception date or grant date and continues throughout the requisite service period. Compensation expense for RSUs granted with a performance condition is recognized on a graded vesting basis over the requisite service period. The amount of compensation expense at each reporting period related to the performance based restricted stock units ("PRSUs") is determined based on the Company's assessment of the probability of achieving the requisite performance criteria. The grant date fair value of RSUs is determined using the market closing price of Class A common stock on the date of grant. The Company accounts for forfeitures as they occur. New Accounting Pronouncements Recently issued not yet adopted accounting pronouncements In March 2020 and January 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-4, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU 2021-1, Reference Rate Reform (Topic 848): Scope, respectively. ASU 2020-4 and ASU 2021-1 provide optional expedients and exceptions for applying U.S. GAAP, to contracts, and other transactions that reference the London Interbank Offered Rate or another reference rate expected to be discontinued because of reference rate reform, if certain criteria are met. The guidance in ASU 2020-4 and ASU 2021-1 was effective upon issuance and, once adopted, may be applied prospectively to contract modifications and hedging relationships through December 31, 2022. The Company is currently evaluating the impact of the adoption of ASU 2020-4 and ASU 2021-1 on its consolidated financial statements. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from contracts with customers. The ASU requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, as if it had originated the contracts. Under the current business combinations guidance, such assets and liabilities were recognized by the acquirer at fair value on the acquisition date. The guidance in ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact of this ASU, but does not expect the adoption of this standard to have a significant impact on its consolidated financial statements. |
Disaggregation of Revenue
Disaggregation of Revenue | 6 Months Ended |
Jun. 30, 2022 | |
Disaggregation of Revenue [Abstract] | |
Disaggregation of Revenue | Disaggregation of revenue The following table shows the Company’s revenue disaggregated by transaction model: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Revenue Open marketplace transactions $ 99,633 $ 152,522 $ 237,729 $ 321,870 Private marketplace transactions 3,816 4,831 8,319 9,071 Total $ 103,449 $ 157,353 $ 246,048 $ 330,941 The following table shows the Company’s revenue disaggregated by product vertical: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Revenue Property & casualty insurance $ 57,571 $ 109,337 $ 145,025 $ 234,878 Health insurance 33,163 33,688 75,272 69,584 Life insurance 7,005 7,479 14,072 15,432 Other (1) 5,710 6,849 11,679 11,047 Total $ 103,449 $ 157,353 $ 246,048 $ 330,941 (1) Other verticals include Travel, Education, and Consumer Finance. |
Business Combinations
Business Combinations | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Business Combinations | Business Combinations On February 24, 2022, QuoteLab, LLC (“QL”), a wholly owned subsidiary of QLH, and CHT Buyer, LLC, a wholly owned subsidiary of QL ("Buyer"), entered into an Asset Purchase Agreement (as amended, the “Agreement”) to acquire substantially all of the assets of Customer Helper Team, LLC ("Seller" or "CHT"). CHT is a provider of customer generation and acquisition services for Medicare insurance, automobile insurance, health insurance, life insurance, debt settlement, and credit repair companies. The Company acquired CHT to increase its customer generation capabilities on various social media and short form video platforms. The transaction was closed on April 1, 2022. The Company accounted for the transaction as a business combination using the acquisition method of accounting as CHT contained inputs and processes that were capable of being operated as a business. The acquisition date fair value of the purchase consideration for the acquisition was $56.7 million, and consisted of the following (in thousands): Fair Value Cash consideration (net of working capital adjustments) $ 49,677 Contingent consideration 7,007 Total purchase consideration $ 56,684 A portion of the cash consideration paid at closing was funded by drawing $25.0 million under the 2021 Revolving Credit Facility, and the balance was funded from the Company's cash on hand as of the closing. The Agreement also provides that the Company shall pay contingent consideration which could range from zero to $20.0 million, based upon CHT's achievement of certain revenue and gross margin targets for the two successive 12-month periods following the closing, as set forth in the Agreement. The contingent consideration has been classified as a liability and the estimated fair value was determined using a Monte Carlo model based on the revenue and gross margin projected to be generated by CHT during the applicable periods. The contingent consideration is subject to remeasurement at each reporting date until paid, with any adjustment resulting from the remeasurement reported within general & administrative expenses in the consolidated statements of operations. The fair value measurements of the contingent consideration are based primarily on significant unobservable inputs and thus represent a Level 3 measurement in the valuation hierarchy as defined in ASC 820. Transaction-related costs incurred by the Company were $0.2 million and $0.5 million and were expensed as incurred and included in general and administrative expenses in the Company's consolidated statement of operations for the three and six months ended June 30, 2022, respectively. In accordance with the acquisition method of accounting, the purchase consideration has been allocated to the assets acquired and liabilities assumed based on their fair values on the date of the acquisition as follows (in thousands): Accounts receivable $ 1,275 Prepaid expenses and other current assets 17 Intangible assets 26,120 Goodwill 29,337 Accounts payable (18) Accrued expenses (47) Net assets acquired $ 56,684 The Company considers the measurement period to be one year form the date of acquisition. The fair value of working capital related items, including accounts receivable, prepaid expenses and other current assets, accounts payable, and accrued expenses, approximated their book values as of the closing date of the acquisition. The excess of the purchase consideration over the fair value of the net assets acquired was recorded as goodwill. The resulting goodwill is attributable primarily to CHT's assembled workforce and the expanded market opportunities provided by the CHT business by increasing the Company’s ability to generate Consumer Referrals on various social media and short form video platforms. The goodwill resulting from the acquisition is tax deductible. For tax purposes, contingent consideration does not become part of tax goodwill until paid. As such, the amount of goodwill deductible for tax purposes as of the closing date of the acquisition was $22.6 million. The Company's estimate of the amount of tax deductible goodwill may change as the amounts of the payments of contingent consideration, if any, are finalized. The identifiable intangible assets for the transaction are definite lived assets. The intangible assets are measured at fair value on a nonrecurring basis and are based primarily on significant unobservable inputs and thus represent a Level 3 measurement in the valuation hierarchy as defined in ASC 820. The acquired intangible asset categories, fair value, and amortization periods, were as follows (in thousands): Useful lives Fair Value Customer relationships 7 years $ 18,460 Trademarks, trade names, and domain names 10 years 7,660 $ 26,120 Customer relationships represent the fair value of the existing contractual relationships and were calculated using the excess earnings methodology of the income approach. The fair value for trademarks, trade names, and domain names was calculated using the relief-from-royalty methodology of the income approach. These fair value measurements were determined using risk-adjusted discount rates of 18.0%. The weighted average life of intangible assets as of the acquisition date was 7.9 years. The fair value of the identified intangible assets subject to amortization will be amortized over the assets’ estimated useful lives based on the pattern in which the economic benefits are expected to be received. Revenue and pretax loss of CHT included in the Company’s results from the acquisition date of April 1, 2022 through June 30, 2022 are as follows (in thousands): Total revenues $ 2,134 Pretax loss $ (803) The following pro forma financial information summarizes the combined results of operations for the Company and CHT, as though the companies were combined as of the beginning of the Company’s fiscal 2021. The unaudited pro forma financial information was as follows (in thousands): Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Total revenues $ 103,449 $ 164,504 $ 252,318 $ 345,068 Pretax (loss) income $ (12,398) $ (227) $ (19,606) $ 10 The pro forma financial information for all periods presented above has been calculated after adjusting the results of CHT to reflect certain business combination and one-time accounting effects such as fair value adjustment of amortization expense from acquired intangible assets, interest expense on the amounts drawn under the 2021 Revolving Credit facility, and acquisition costs as though the acquisition occurred as of the beginning of the Company’s fiscal 2021. The historical consolidated financial information has been adjusted in the pro forma combined financial results to give effect to pro forma events that are directly attributable to the business combination, reasonably estimable and factually supportable. The pro forma financial information does not include the impact of remeasurement adjustments to the contingent considerations and restricted stock units granted to employees of CHT on the date of acquisition for post combination services and are included within the periods they were incurred. The pro forma financial information is for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place at the beginning of the Company’s fiscal 2021. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and intangible assets Goodwill and intangible assets consisted of: As of June 30, 2022 December 31, 2021 (in thousands) Useful Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Customer relationships 84 - 120 $ 43,500 $ (14,836) $ 28,664 $ 25,040 $ (12,730) $ 12,310 Non-compete agreements 60 303 (286) 17 303 (268) 35 Trademarks, trade names, and domain names 60 - 120 8,884 (1,238) 7,646 1,224 (1,002) 222 Intangible assets $ 52,687 $ (16,360) $ 36,327 $ 26,567 $ (14,000) $ 12,567 Goodwill Indefinite $ 47,739 $ — $ 47,739 $ 18,402 $ — $ 18,402 Amortization expense related to intangible assets amounted to $1.7 million and $0.7 million for the three months ended June 30, 2022 and 2021, respectively, and $2.4 million and $1.5 million for the six months ended June 30, 2022 and 2021, respectively. The Company has no accumulated impairment of goodwill. The following table presents the changes in goodwill and intangible assets: As of June 30, 2022 December 31, 2021 (in thousands) Goodwill Intangible Goodwill Intangible Beginning balance $ 18,402 $ 12,567 $ 18,402 $ 15,551 Additions to goodwill and intangible assets 29,337 26,120 — — Amortization — (2,360) — (2,984) Ending balance $ 47,739 $ 36,327 $ 18,402 $ 12,567 As of June 30, 2022, future amortization expense relating to identifiable intangible assets with estimable useful lives over the next five years was as follows: (in thousands) Amortization expense 2022–Remaining Period $ 3,396 2023 6,917 2024 6,427 2025 5,759 2026 5,142 Thereafter 8,686 $ 36,327 |
Accrued Expenses
Accrued Expenses | 6 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Accrued Expenses | Accrued expenses Accrued expenses include the following: As of (in thousands) June 30, December 31, Accrued payroll and related expenses $ 2,811 $ 5,030 Accrued operating expenses 2,146 1,103 |
Long-term Debt
Long-term Debt | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Long-term Debt | Long-term debt On July 29, 2021, the Company entered into an amendment (the "First Amendment") to the 2020 Credit Agreement dated as of September 23, 2020, with the lenders from time-to-time party thereto and JPMorgan Chase Bank, N.A., as administrative agent (as amended by the First Amendment, the “Amended Credit Agreement”). The Amended Credit Agreement provides for a new senior secured term loan facility in an aggregate principal amount of $190.0 million (the "2021 Term Loan Facility"), the proceeds of which were used to refinance all $186.4 million of the existing term loans outstanding and the unpaid interest thereof as of the date of the First Amendment, fees related to these transactions, and to provide cash for general corporate purposes, and a new senior secured revolving credit facility with commitments in an aggregate amount of $50.0 million (the "2021 Revolving Credit Facility" and, together with the 2021 Term Loan Facility, the "2021 Credit Facilities"), which replaced the existing revolving credit facility under the 2020 Credit Agreement. Long-term debt consisted of the following: As of (in thousands) June 30, December 31, 2021 Term Loan Facility $ 185,250 $ 190,000 2021 Revolving Credit Facility 25,000 — Debt issuance costs (2,815) (3,201) Total debt $ 207,435 $ 186,799 Less: current portion, net of debt issuance costs of $751 and $770, respectively (8,749) (8,730) Total long-term debt $ 198,686 $ 178,069 Loans under the 2021 Credit Facilities will mature on July 29, 2026. Loans under the 2021 Term Loan Facility amortize quarterly, beginning on the first business day after December 31, 2021 and ending with June 30, 2026, by an amount equal to 1.25% of the aggregate outstanding principal amount of the term loans initially made and will mature on July 29, 2026. Accordingly, the amount of mandatory quarterly principal payable amount under the 2021 Term Loan within the next twelve months has been classified within the current portion of long-term debt and the remaining balance as long-term debt, net of current portion on the consolidated balance sheets. The 2021 Revolving Credit Facility does not amortize and will mature on July 29, 2026 and has been classified as non-current within long-term debt, net of current portion on the consolidated balance sheet. The Company incurred interest expense on the 2021 Term Loan Facility of $1.7 million and $2.2 million for the three months ended June 30, 2022 and 2021, respectively, and $3.0 million and $4.5 million for the six months ended June 30, 2022 and 2021, respectively. The Company incurred interest expense on the 2021 Revolving Credit Facility of $0.2 million and $0.3 million for the three and six months ended June 30, 2022, respectively. Interest expense included amortization of debt issuance costs on the 2021 Credit Facility of $0.2 million and $0.3 million for the three months ended June 30, 2022 and 2021, respectively, and $0.4 million and $0.7 million for the six months ended June 30, 2022 and 2021, respectively. Accrued interest was $1.8 million as of June 30, 2022 and $1.7 million as of December 31, 2021, and is included within accrued expenses on the consolidated balance sheets. The expected future principal payments for all borrowings as of June 30, 2022 was as follows: (in thousands) Contractual maturity 2022–Remaining Period $ 4,750 2023 9,500 2024 9,500 2025 9,500 2026 177,000 Debt and issuance costs 210,250 Unamortized debt issuance costs (2,815) Total debt $ 207,435 The carrying amount of the 2021 Term Loan Facility and the 2021 Revolving Credit Facility approximates the fair values thereof as the borrowings have a variable interest rate structure with no prepayment penalties and are classified within the Level 2 of the valuation hierarchy. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and contingencies Litigation The Company is subject to certain legal proceedings and claims that arise in the normal course of business. In the opinion of management, the Company does not believe that the amount of liability, if any, as a result of these proceedings and claims will have a materially adverse effect on the Company’s consolidated financial position, results of operations, or cash flows. As of June 30, 2022 and December 31, 2021, the Company did not have any contingency reserves established for any litigation liabilities. |
Equity-based Compensation
Equity-based Compensation | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Equity-based Compensation | Equity-based compensation The Company’s equity-based compensation plans are fully described in Part II, Item 8 "Financial Statements and Supplementary Data—Note 9 to the Consolidated Financial Statements—Equity-based compensation plans" in the 2021 Annual Report on Form 10-K and below as it relates to PRSUs. Performance-Based Restricted Stock Units In April 2022, the Company granted PRSUs to certain officers under the 2020 Omnibus Incentive Plan. Each PRSU represents the right to receive one share of Class A common stock upon vesting. The PRSUs granted vest based on the achievement of certain performance measures, as determined by the Compensation Committee of the Company's Board of Directors, with the resulting value earned divided by the weighted-average closing price of the Company's Class A common stock for the 90-day period preceding such determination to yield the number of PRSUs to be vested. The expected vesting period of such PRSUs is approximately one year. The PRSUs are liability-classified awards, as they are based on a fixed dollar amount to be settled in a variable number of shares. At each reporting period, the Company recognizes any related expense based on the estimated probability of the achievement of these performance measures and the portion of the requisite service period completed. The amount of expense recognized in any period can vary based on changes in the expected achievement of the specified performance measures. If such performance measures are determined to be not likely to be met, or are ultimately not met, no further expense is recognized and any previously recognized expense is reversed. Upon vesting of the PRSUs, the Company will issue the resulting number of shares of Class A common stock to the officers. Equity-based compensation cost recognized for equity based awards outstanding during the three and six months ended June 30, 2022 and 2021 was as follows: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 QLH Class B units $ — $ — $ — $ — QLH restricted Class B-1 units 47 140 132 265 Restricted Class A shares 213 285 561 552 Restricted stock units 15,520 11,096 28,860 21,306 Performance restricted stock units 63 — 63 — Total equity-based compensation $ 15,843 $ 11,521 $ 29,616 $ 22,123 Equity-based compensation cost was allocated to the following expense categories in the consolidated statements of operations during the three and six months ended June 30, 2022 and 2021: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Cost of revenue $ 1,240 $ 442 $ 1,638 $ 842 Sales and marketing 2,769 1,981 5,474 3,683 Product development 2,646 1,665 4,895 2,997 General and administrative 9,188 7,433 17,609 14,601 Total equity-based compensation $ 15,843 $ 11,521 $ 29,616 $ 22,123 As of June 30, 2022, total unrecognized compensation cost related to unvested QLH restricted Class B-1 units, restricted Class A shares, restricted stock units, and PRSUs was $0.2 million, $1.3 million, $108.0 million, and $0.2 million, respectively, which are expected to be recognized over weighted-average periods of 1.11 years, 1.41 years, 2.43 years, and 0.70 years, respectively. |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) | 6 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
Stockholders' Equity (Deficit) | Stockholders' Equity (Deficit)Share Repurchase Program On March 14, 2022, the Board of Directors approved a Share Repurchase Program ("Repurchase Program") that authorized the Company to repurchase up to $5.0 million of the Company’s Class A common stock from time to time in open market transactions at prevailing market prices or by other means in accordance with federal securities laws. The timing and amount of any share repurchases are determined by the Company’s management based on their ongoing evaluation of market conditions, the Company’s capital needs, debt covenants and other factors. The Repurchase Program does not obligate the Company to repurchase a fixed number of shares and any repurchases are accounted for as of the trade date with a corresponding liability. The excess between the repurchase price and the par value of the shares of Class A common stock repurchased is recorded as an adjustment to additional-paid-in capital . |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value MeasurementsThe following table summarizes the Company’s financial instruments measured at fair value on a recurring basis by level, within the valuation hierarchy: June 30, 2022 (in thousands) Level 1 Level 2 Level 3 Total Liabilities Contingent consideration $ — $ — $ 4,162 $ 4,162 Total liabilities $ — $ — $ 4,162 $ 4,162 December 31, 2021 (in thousands) Level 1 Level 2 Level 3 Total Liabilities Contingent consideration $ — $ — $ — $ — Total liabilities $ — $ — $ — $ — Contingent consideration Contingent consideration is measured at fair value on a recurring basis using significant unobservable inputs and thus represent a Level 3 measurement in the valuation hierarchy. The following table summarizes the changes in the contingent consideration: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Beginning fair value $ — $ — $ — $ — Additions in the period 7,007 — 7,007 — Change in fair value (2,845) — (2,845) — Ending fair value $ 4,162 $ — $ 4,162 $ — Contingent consideration relates to the estimated amount of additional cash consideration to be paid in connection with the Company's acquisition of CHT. The fair value is dependent on the probability of achieving certain revenue and gross profit margin targets for the two successive 12-month periods following the closing of the acquisition. The Company used the Monte Carlo simulation approach to estimate the fair value of the revenue and gross margin targets and were determined using risk-adjusted discount rates and volatility for the revenue target of 6.0% and 12.5%, respectively and for the gross profit target of 19.0% and 70.0%, respectively. A change in any of these unobservable inputs can significantly change the fair value of the contingent consideration. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income taxes MediaAlpha, Inc. is taxed as a corporation and pays corporate federal, state and local taxes on income allocated to it from QLH based upon MediaAlpha, Inc.’s economic interest held in QLH. QLH is treated as a pass-through partnership for income tax reporting purposes and is not subject to federal income tax. Instead, QLH’s taxable income or loss is passed through to its members, including MediaAlpha, Inc. Accordingly, the Company is not liable for income taxes on the portion of QLH’s earnings not allocated to it. MediaAlpha, Inc. files and pays corporate income taxes for U.S. federal and state income tax purposes and its corporate subsidiary, Skytiger Studio, Ltd., is subject to taxation in Taiwan. The Company expects this structure to remain in existence for the foreseeable future. The Company estimates the annual effective tax rate for the full year to be applied to actual year-to-date income (loss) and adds the tax effects of any discrete items in the reporting period in which they occur. The Company’s effective income tax rate was (4.9)% and (8.3)% for the three and six months ended June 30, 2022, respectively. The Company’s effective income tax rate was 24.6% and 68.7% for the three and six months ended June 30, 2021, respectively. The following table summarizes the Company's income tax expense (benefit): Three months ended Six Months Ended (in thousands, except percentages) 2022 2021 2022 2021 (Loss) before income taxes $ (12,411) $ (509) $ (21,116) $ (712) Income tax expense (benefit) $ 611 $ (125) $ 1,754 $ (489) Effective Tax Rate (4.9) % 24.6 % (8.3) % 68.7 % The Company's effective tax rate of (4.9)% and (8.3)% for the three and six months ended June 30, 2022 differed from the U.S. federal statutory rate of 21%, due primarily to nondeductible equity-based compensation, losses associated with non-controlling interests not taxable to the Company, state taxes, and other nondeductible permanent items. There were no material changes to the Company’s unrecognized tax benefits during the three and six months ended June 30, 2022, and the Company does not expect to have any significant changes to unrecognized tax benefits through the end of the fiscal year. During the three and six months ended June 30, 2022, holders of Class B-1 units exchanged a total of 297,747 and 357,944 Class B-1 units, respectively, together with an equal number of shares of Class B common stock, for shares of Class A common stock on a one-for-one basis (the “Exchanges”). In connection with the Exchanges, the Company recognized an additional deferred tax asset of $1.1 million and $1.3 million during the three and six months ended June 30, 2022, respectively, associated with the basis difference in its investment in QLH. As of June 30, 2022, the total deferred tax asset related to the basis difference in the Company's investment in QLH was $80.0 million. The Company also recognized $0.3 million and $0.4 million of deferred tax assets for the three and six months ended June 30, 2022, respectively, related to additional tax basis increases generated from expected future payments under the Tax Receivables Agreement (“TRA”) and expected future deductions for imputed interest on such payments. The Company evaluates the realizability of its deferred tax assets on a quarterly basis and establishes valuation allowances when it is more likely than not that all or a portion of a deferred tax asset may not be realized. As of June 30, 2022, there were no material changes to the Company's valuation allowance and the Company's assessment of the realizability of its deferred tax assets. Tax Receivables Agreement In connection with the Reorganization Transactions and the IPO, the Company entered into the TRA with Insignia, White Mountains, and the Senior Executives. The Company expects to obtain an increase in its share of the tax basis in the net assets of QLH as Class B-1 units are exchanged for shares of Class A common stock (or, at the Company's election, redeemed for cash of an equivalent value). The Company intends to treat any redemptions and exchanges of Class B-1 units as direct purchases for U.S. federal income tax purposes. These increases in tax basis may reduce the amounts that it would otherwise pay in the future to various tax authorities. The Exchanges resulted in an increase in the tax basis of the Company's investment in QLH subject to the provisions of the TRA. As a result, the Company recognized an additional liability in the amount of $1.4 million and $1.6 million for the TRA-related payments during the three and six months ended June 30, 2022, respectively, representing 85% of the aggregate tax benefits it expects to realize from the increases in tax basis related to the redemption of Class B-1 units, after concluding it was probable that such TRA payments would be paid based on management's estimates of future taxable income. During the three and six months ended June 30, 2022 , the Company paid $0 and $0.2 million pursuant to the TRA, respectively. As of June 30, 2022, the total amount of payments expected to be paid under the TRA was $86.1 million, of which $2.8 million was included in accrued expenses on the Company's consolidated balance sheets. |
Earnings (Loss) Per Share
Earnings (Loss) Per Share | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Earning (Loss) Per Share | Earnings (Loss) Per Share Three months ended Six Months Ended (in thousands except share data and per share amount) 2022 2021 2022 2021 Basic Net (loss) $ (13,022) $ (384) $ (22,870) $ (223) Less: net (loss) attributable to non-controlling interest (3,883) (177) (6,655) (301) Net (loss) income available for basic common shares $ (9,139) $ (207) $ (16,215) $ 78 Weighted-average shares of Class A common stock outstanding - basic and diluted 41,705,344 37,667,432 41,279,146 35,414,548 (Loss) earnings per share of Class A common stock - basic and diluted $ (0.22) $ (0.01) $ (0.39) $ 0.00 The Company’s potentially dilutive securities were not included in the calculation of diluted loss per share for the three and six months ended June 30, 2022 as the effect would be anti-dilutive. The following table summarizes the shares and units with a potentially dilutive impact: As of June 30, 2022 June 30, 2021 QLH Class B-1 Units 19,206,446 21,076,952 Restricted Class A Shares 332,072 789,999 Restricted stock units 6,371,147 4,850,011 Potential dilutive shares 25,909,665 26,716,962 The outstanding PRSUs were not included in the potentially dilutive securities as of June 30, 2022 as the performance conditions have not been met. |
Non-Controlling Interest
Non-Controlling Interest | 6 Months Ended |
Jun. 30, 2022 | |
Noncontrolling Interest [Abstract] | |
Non-Controlling Interest | Non-Controlling Interest In accordance with QLH’s limited liability company agreement, the Company allocates the share of net income (loss) to the holders of non-controlling interests pro-rata to their holdings at a point in time. The non-controlling interests balance represents the Class B-1 units, substantially all of which are held by Insignia and the Senior Executives. During the six months ended June 30, 2022, holders of Class B-1 units exchanged 357,944 Class B-1 units, together with an equal number of shares of Class B common stock, for shares of Class A common stock on a one-for-one basis. As of June 30, 2022, the holders of the non-controlling interests owned 31.2%, with the remaining 68.8% owned by MediaAlpha, Inc. As of December 31, 2021, the holders of the non-controlling interests owned 32.1%, with the remaining 67.9% owned by MediaAlpha, Inc. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of presentation | Basis of presentation The accompanying unaudited consolidated financial statements and related disclosures have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") applicable to interim financial information and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. In the opinion of management, all adjustments, consisting of only those of a normal recurring nature, considered necessary for a fair statement of the financial position and interim results of the Company as of and for the periods presented have been included. The December 31, 2021 balance sheet data was derived from audited consolidated financial statements; however, the accompanying interim notes to the consolidated financial statements do not include all of the annual disclosures required by GAAP. Results for interim periods are not necessarily indicative of those that may be expected for a full year. The financial information included herein should be read in conjunction with the Company's consolidated financial statements and related notes in its 2021 Annual Report on Form 10-K. |
Revisions to previously issued consolidated financial statements | Revisions to previously issued consolidated financial statements On December 31, 2021, the Company adopted ASU No. 2016-02, Leases (Topic 842) effective from January 1, 2021 using the optional transition approach by applying the new standard to all leases existing at the date of initial application and prior periods were not restated. In connection with the adoption, quarterly amounts presented in the Company's prior Form 10-Q were revised. The impact of the adjustments was immaterial to the Company's consolidated financial statements. |
Accounts receivable | Accounts receivable Accounts receivable are net of allowances for credit losses of $0.4 million and $0.6 million as of June 30, 2022 and December 31, 2021, respectively. |
Concentrations of credit risk and of significant customers and suppliers | Concentrations of credit risk and of significant customers and suppliers Financial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and cash equivalents and accounts receivable. The Company maintains cash balances that can, at times, exceed amounts insured by the Federal Deposit Insurance Corporation. The Company has not experienced any losses in these accounts, and believes it is not exposed to unusual credit risk beyond the normal credit risk in this area based on the financial strength of the institutions with which the Company maintains its deposits. The Company's accounts receivable, which are unsecured, may expose it to credit risk based on their collectability. The Company controls credit risk by investigating the creditworthiness of all customers prior to establishing relationships with them, performing periodic reviews of the credit activities of those customers during the course of the business relationship, regularly analyzing the collectability of accounts receivable, and recording allowances for credit losses. Customer concentrations consisted of one customer that accounted for approximately $13 million, or 13%, and $32 million, or 13%, of revenue for the three and six months ended June 30, 2022, respectively, compared with two customers that collectively accounted for approximately $45 million, or 28%, and $95 million, or 29%, of revenue for the three and six months ended June 30, 2021, respectively. The Company's largest customer accounted for approximately $5 million, or 13%, of total accounts receivable as of June 30, 2022, compared with approximately $7 million, or 10%, of total accounts receivable as of December 31, 2021. |
Equity-based compensation | Equity-based compensation The Company incurs equity-based compensation expense from restricted stock units (“RSUs”) and the unvested Restricted Class A shares and QLH Restricted Class B-1 units. Equity-classified awards to employees are measured and recognized in the consolidated financial statements based on the fair value of the award on the grant date and not subsequently remeasured unless modified. Liability-classified awards are measured at fair value on the grant date and remeasured at each reporting period until the award is settled. For awards subject to service conditions only, the fair value of the award on the grant date is expensed on a straight-line basis over the requisite service period of the award. The recognition period for these expenses begins at either the applicable service inception date or grant date and continues throughout the requisite service period. Compensation expense for RSUs granted with a performance condition is recognized on a graded vesting basis over the requisite service period. The amount of compensation expense at each reporting period related to the performance based restricted stock units ("PRSUs") is determined based on the Company's assessment of the probability of achieving the requisite performance criteria. The grant date fair value of RSUs is determined using the market closing price of Class A common stock on the date of grant. The Company accounts for forfeitures as they occur. |
New accounting pronouncements | New Accounting Pronouncements Recently issued not yet adopted accounting pronouncements In March 2020 and January 2021, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2020-4, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and ASU 2021-1, Reference Rate Reform (Topic 848): Scope, respectively. ASU 2020-4 and ASU 2021-1 provide optional expedients and exceptions for applying U.S. GAAP, to contracts, and other transactions that reference the London Interbank Offered Rate or another reference rate expected to be discontinued because of reference rate reform, if certain criteria are met. The guidance in ASU 2020-4 and ASU 2021-1 was effective upon issuance and, once adopted, may be applied prospectively to contract modifications and hedging relationships through December 31, 2022. The Company is currently evaluating the impact of the adoption of ASU 2020-4 and ASU 2021-1 on its consolidated financial statements. In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from contracts with customers. The ASU requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with Customers, as if it had originated the contracts. Under the current business combinations guidance, such assets and liabilities were recognized by the acquirer at fair value on the acquisition date. The guidance in ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact of this ASU, but does not expect the adoption of this standard to have a significant impact on its consolidated financial statements. |
Disaggregation of Revenue (Tabl
Disaggregation of Revenue (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Disaggregation of Revenue [Abstract] | |
Summary of Disaggregation of Revenue | The following table shows the Company’s revenue disaggregated by transaction model: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Revenue Open marketplace transactions $ 99,633 $ 152,522 $ 237,729 $ 321,870 Private marketplace transactions 3,816 4,831 8,319 9,071 Total $ 103,449 $ 157,353 $ 246,048 $ 330,941 The following table shows the Company’s revenue disaggregated by product vertical: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Revenue Property & casualty insurance $ 57,571 $ 109,337 $ 145,025 $ 234,878 Health insurance 33,163 33,688 75,272 69,584 Life insurance 7,005 7,479 14,072 15,432 Other (1) 5,710 6,849 11,679 11,047 Total $ 103,449 $ 157,353 $ 246,048 $ 330,941 (1) Other verticals include Travel, Education, and Consumer Finance. |
Business Combinations (Tables)
Business Combinations (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Summary of Consideration Transferred | The acquisition date fair value of the purchase consideration for the acquisition was $56.7 million, and consisted of the following (in thousands): Fair Value Cash consideration (net of working capital adjustments) $ 49,677 Contingent consideration 7,007 Total purchase consideration $ 56,684 |
Summary of Purchase Price Allocation | In accordance with the acquisition method of accounting, the purchase consideration has been allocated to the assets acquired and liabilities assumed based on their fair values on the date of the acquisition as follows (in thousands): Accounts receivable $ 1,275 Prepaid expenses and other current assets 17 Intangible assets 26,120 Goodwill 29,337 Accounts payable (18) Accrued expenses (47) Net assets acquired $ 56,684 |
Summary of Acquired Intangible Assets | The identifiable intangible assets for the transaction are definite lived assets. The intangible assets are measured at fair value on a nonrecurring basis and are based primarily on significant unobservable inputs and thus represent a Level 3 measurement in the valuation hierarchy as defined in ASC 820. The acquired intangible asset categories, fair value, and amortization periods, were as follows (in thousands): Useful lives Fair Value Customer relationships 7 years $ 18,460 Trademarks, trade names, and domain names 10 years 7,660 $ 26,120 |
Summary of Revenue and Pretax Loss | Revenue and pretax loss of CHT included in the Company’s results from the acquisition date of April 1, 2022 through June 30, 2022 are as follows (in thousands): Total revenues $ 2,134 Pretax loss $ (803) The following pro forma financial information summarizes the combined results of operations for the Company and CHT, as though the companies were combined as of the beginning of the Company’s fiscal 2021. The unaudited pro forma financial information was as follows (in thousands): Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Total revenues $ 103,449 $ 164,504 $ 252,318 $ 345,068 Pretax (loss) income $ (12,398) $ (227) $ (19,606) $ 10 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill and Intangible Assets | Goodwill and intangible assets consisted of: As of June 30, 2022 December 31, 2021 (in thousands) Useful Gross carrying amount Accumulated amortization Net carrying amount Gross carrying amount Accumulated amortization Net carrying amount Customer relationships 84 - 120 $ 43,500 $ (14,836) $ 28,664 $ 25,040 $ (12,730) $ 12,310 Non-compete agreements 60 303 (286) 17 303 (268) 35 Trademarks, trade names, and domain names 60 - 120 8,884 (1,238) 7,646 1,224 (1,002) 222 Intangible assets $ 52,687 $ (16,360) $ 36,327 $ 26,567 $ (14,000) $ 12,567 Goodwill Indefinite $ 47,739 $ — $ 47,739 $ 18,402 $ — $ 18,402 |
Summary of Change in Goodwill and Intangible Assets | The following table presents the changes in goodwill and intangible assets: As of June 30, 2022 December 31, 2021 (in thousands) Goodwill Intangible Goodwill Intangible Beginning balance $ 18,402 $ 12,567 $ 18,402 $ 15,551 Additions to goodwill and intangible assets 29,337 26,120 — — Amortization — (2,360) — (2,984) Ending balance $ 47,739 $ 36,327 $ 18,402 $ 12,567 |
Summary of Future Amortization Expense on Identifiable Intangible Assets | As of June 30, 2022, future amortization expense relating to identifiable intangible assets with estimable useful lives over the next five years was as follows: (in thousands) Amortization expense 2022–Remaining Period $ 3,396 2023 6,917 2024 6,427 2025 5,759 2026 5,142 Thereafter 8,686 $ 36,327 |
Accrued Expenses (Tables)
Accrued Expenses (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Payables and Accruals [Abstract] | |
Summary of Accrued Expenses | Accrued expenses include the following: As of (in thousands) June 30, December 31, Accrued payroll and related expenses $ 2,811 $ 5,030 Accrued operating expenses 2,146 1,103 |
Long-term Debt (Tables)
Long-term Debt (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt consisted of the following: As of (in thousands) June 30, December 31, 2021 Term Loan Facility $ 185,250 $ 190,000 2021 Revolving Credit Facility 25,000 — Debt issuance costs (2,815) (3,201) Total debt $ 207,435 $ 186,799 Less: current portion, net of debt issuance costs of $751 and $770, respectively (8,749) (8,730) Total long-term debt $ 198,686 $ 178,069 |
Schedule of Expected Future Principal Payments for Borrowings | The expected future principal payments for all borrowings as of June 30, 2022 was as follows: (in thousands) Contractual maturity 2022–Remaining Period $ 4,750 2023 9,500 2024 9,500 2025 9,500 2026 177,000 Debt and issuance costs 210,250 Unamortized debt issuance costs (2,815) Total debt $ 207,435 |
Equity-based Compensation (Tabl
Equity-based Compensation (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Equity-based Compensation Cost Recognized | Equity-based compensation cost recognized for equity based awards outstanding during the three and six months ended June 30, 2022 and 2021 was as follows: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 QLH Class B units $ — $ — $ — $ — QLH restricted Class B-1 units 47 140 132 265 Restricted Class A shares 213 285 561 552 Restricted stock units 15,520 11,096 28,860 21,306 Performance restricted stock units 63 — 63 — Total equity-based compensation $ 15,843 $ 11,521 $ 29,616 $ 22,123 |
Schedule of Equity-based Compensation Expense | Equity-based compensation cost was allocated to the following expense categories in the consolidated statements of operations during the three and six months ended June 30, 2022 and 2021: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Cost of revenue $ 1,240 $ 442 $ 1,638 $ 842 Sales and marketing 2,769 1,981 5,474 3,683 Product development 2,646 1,665 4,895 2,997 General and administrative 9,188 7,433 17,609 14,601 Total equity-based compensation $ 15,843 $ 11,521 $ 29,616 $ 22,123 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Liabilities Measured at Fair Value on a Recurring Basis | The following table summarizes the Company’s financial instruments measured at fair value on a recurring basis by level, within the valuation hierarchy: June 30, 2022 (in thousands) Level 1 Level 2 Level 3 Total Liabilities Contingent consideration $ — $ — $ 4,162 $ 4,162 Total liabilities $ — $ — $ 4,162 $ 4,162 December 31, 2021 (in thousands) Level 1 Level 2 Level 3 Total Liabilities Contingent consideration $ — $ — $ — $ — Total liabilities $ — $ — $ — $ — |
Schedule of Fair Value of the Company's Contingent Consideration Obligations | The following table summarizes the changes in the contingent consideration: Three months ended Six Months Ended (in thousands) 2022 2021 2022 2021 Beginning fair value $ — $ — $ — $ — Additions in the period 7,007 — 7,007 — Change in fair value (2,845) — (2,845) — Ending fair value $ 4,162 $ — $ 4,162 $ — |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
Summary of Our Income Tax Expense (Benefit) | The following table summarizes the Company's income tax expense (benefit): Three months ended Six Months Ended (in thousands, except percentages) 2022 2021 2022 2021 (Loss) before income taxes $ (12,411) $ (509) $ (21,116) $ (712) Income tax expense (benefit) $ 611 $ (125) $ 1,754 $ (489) Effective Tax Rate (4.9) % 24.6 % (8.3) % 68.7 % |
Earnings (Loss) Per Share (Tabl
Earnings (Loss) Per Share (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Earnings Per Share [Abstract] | |
Summary of Calculation of Basic and Diluted Net Loss Per Share | Three months ended Six Months Ended (in thousands except share data and per share amount) 2022 2021 2022 2021 Basic Net (loss) $ (13,022) $ (384) $ (22,870) $ (223) Less: net (loss) attributable to non-controlling interest (3,883) (177) (6,655) (301) Net (loss) income available for basic common shares $ (9,139) $ (207) $ (16,215) $ 78 Weighted-average shares of Class A common stock outstanding - basic and diluted 41,705,344 37,667,432 41,279,146 35,414,548 (Loss) earnings per share of Class A common stock - basic and diluted $ (0.22) $ (0.01) $ (0.39) $ 0.00 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The Company’s potentially dilutive securities were not included in the calculation of diluted loss per share for the three and six months ended June 30, 2022 as the effect would be anti-dilutive. The following table summarizes the shares and units with a potentially dilutive impact: As of June 30, 2022 June 30, 2021 QLH Class B-1 Units 19,206,446 21,076,952 Restricted Class A Shares 332,072 789,999 Restricted stock units 6,371,147 4,850,011 Potential dilutive shares 25,909,665 26,716,962 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Significant Accounting Policies [Line Items] | |||||
Accounts receivable, allowance for credit losses | $ 374 | $ 374 | $ 609 | ||
Revenue | 103,449 | $ 157,353 | 246,048 | $ 330,941 | |
Accounts receivable | 38,856 | 38,856 | 76,094 | ||
Total purchases | 87,925 | 132,305 | 208,806 | 279,485 | |
Accounts payable | 33,434 | 33,434 | 61,770 | ||
Paid to related party | 1,300 | 2,200 | |||
Additional amount reimbursable to related party | 400 | 500 | |||
Amount reimbursable to related party | 500 | $ 500 | $ 2,300 | ||
Tax Receivables Agreement | |||||
Significant Accounting Policies [Line Items] | |||||
Related party transaction rate (as a percent) | 85% | ||||
Paid to related party | 0 | $ 200 | |||
Customer Concentration Risk | Revenue from Contract with Customer Benchmark | Top One Customer | |||||
Significant Accounting Policies [Line Items] | |||||
Revenue | $ 13,000 | $ 32,000 | |||
Concentration risk percentage | 13% | 13% | |||
Customer Concentration Risk | Revenue from Contract with Customer Benchmark | Top Two Customer | |||||
Significant Accounting Policies [Line Items] | |||||
Revenue | $ 45,000 | $ 95,000 | |||
Concentration risk percentage | 28% | 29% | |||
Customer Concentration Risk | Accounts Receivable | Top One Customer | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk percentage | 13% | 10% | |||
Accounts receivable | $ 5,000 | $ 5,000 | $ 7,000 | ||
Supplier Concentration Risk | Purchases | Top One Supplier | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk percentage | 10% | 10% | |||
Total purchases | $ 10,000 | $ 24,000 | |||
Supplier Concentration Risk | Accounts Payable Benchmark | Top One Supplier | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk percentage | 18% | ||||
Accounts payable | $ 6,000 | $ 6,000 | |||
Supplier Concentration Risk | Accounts Payable Benchmark | Top Two Suppliers | |||||
Significant Accounting Policies [Line Items] | |||||
Concentration risk percentage | 34% | ||||
Accounts payable | $ 21,000 |
Disaggregation of Revenue - Sum
Disaggregation of Revenue - Summary of Disaggregation of Revenue by Transaction Model (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 103,449 | $ 157,353 | $ 246,048 | $ 330,941 |
Open marketplace transactions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 99,633 | 152,522 | 237,729 | 321,870 |
Private marketplace transactions | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 3,816 | $ 4,831 | $ 8,319 | $ 9,071 |
Disaggregation of Revenue - S_2
Disaggregation of Revenue - Summary of Disaggregation of Revenue by Product Vertical (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 103,449 | $ 157,353 | $ 246,048 | $ 330,941 |
Property & casualty insurance | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 57,571 | 109,337 | 145,025 | 234,878 |
Health insurance | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 33,163 | 33,688 | 75,272 | 69,584 |
Life insurance | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | 7,005 | 7,479 | 14,072 | 15,432 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue | $ 5,710 | $ 6,849 | $ 11,679 | $ 11,047 |
Business Combinations - Narrati
Business Combinations - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Apr. 01, 2022 | Feb. 24, 2022 | Jun. 30, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Revolving credit facility | $ 25,000 | $ 0 | ||||
Other long-term liabilities | $ 7,999 | $ 7,999 | $ 4,058 | |||
Discount rate | 18% | |||||
Customer Helper Team, LLC | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Acquisition related costs | 200 | $ 500 | ||||
Expected goodwill deductible for tax purposes | $ 22,600 | $ 22,600 | ||||
Customer Helper Team, LLC | Minimum | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Contingent payments | $ 0 | |||||
Customer Helper Team, LLC | Maximum | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Contingent payments | 20,000 | |||||
Customer Helper Team, LLC | Revolving Credit Facility | 2021 Credit Facilities | Line of credit | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Revolving credit facility | $ 25,000 | |||||
QuoteLab, LLC | ||||||
Business Acquisition, Contingent Consideration [Line Items] | ||||||
Total purchase consideration | $ 56,684 | |||||
Useful lives | 7 years 10 months 24 days |
Business Combinations - Summary
Business Combinations - Summary of Consideration Transferred (Details) - QuoteLab, LLC $ in Thousands | Feb. 24, 2022 USD ($) |
Business Acquisition, Contingent Consideration [Line Items] | |
Cash consideration (net of working capital adjustments) | $ 49,677 |
Contingent consideration | 7,007 |
Total purchase consideration | $ 56,684 |
Business Combinations - Summa_2
Business Combinations - Summary of Purchase Price Allocation (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Feb. 24, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Business Acquisition, Contingent Consideration [Line Items] | ||||
Goodwill | $ 47,739 | $ 18,402 | $ 18,402 | |
QuoteLab, LLC | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Accounts receivable | $ 1,275 | |||
Prepaid expenses and other current assets | 17 | |||
Intangible assets | 26,120 | |||
Goodwill | 29,337 | |||
Accounts payable | (18) | |||
Accrued expenses | (47) | |||
Net assets acquired | $ 56,684 |
Business Combinations - Summa_3
Business Combinations - Summary of Acquired Intangible Assets (Details) - USD ($) $ in Thousands | 6 Months Ended | 9 Months Ended | |
Feb. 24, 2022 | Jun. 30, 2022 | Sep. 30, 2021 | |
Business Acquisition, Contingent Consideration [Line Items] | |||
Fair Value | $ 26,120 | $ 0 | |
Customer relationships | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Useful lives | 7 years | ||
Fair Value | $ 18,460 | ||
Trademarks, trade names, and domain names | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Fair Value | $ 7,660 | ||
QuoteLab, LLC | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Useful lives | 7 years 10 months 24 days | ||
QuoteLab, LLC | Trademarks, trade names, and domain names | |||
Business Acquisition, Contingent Consideration [Line Items] | |||
Useful lives | 10 years |
Business Combinations - Summa_4
Business Combinations - Summary of Revenue and Pretax Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Business Acquisition, Contingent Consideration [Line Items] | ||||
(Loss) before income taxes | $ (12,411) | $ (509) | $ (21,116) | $ (712) |
Customer Helper Team, LLC | ||||
Business Acquisition, Contingent Consideration [Line Items] | ||||
Revenues | 2,134 | |||
(Loss) before income taxes | (803) | |||
Total revenues | 103,449 | 164,504 | 252,318 | 345,068 |
Pretax (loss) income | $ (12,398) | $ (227) | $ (19,606) | $ 10 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Summary of Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Goodwill And Intangible Assets [Line Items] | ||||
Gross carrying amount | $ 52,687 | $ 52,687 | $ 26,567 | |
Accumulated amortization | (16,360) | (16,360) | (14,000) | |
Net carrying amount | 36,327 | 36,327 | 12,567 | $ 15,551 |
Goodwill | 47,739 | 47,739 | 18,402 | $ 18,402 |
Customer relationships | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Gross carrying amount | 43,500 | 43,500 | 25,040 | |
Accumulated amortization | (14,836) | (14,836) | (12,730) | |
Net carrying amount | $ 28,664 | $ 28,664 | 12,310 | |
Customer relationships | Minimum | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Useful life (months) | 84 months | |||
Customer relationships | Maximum | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Useful life (months) | 120 months | |||
Non-compete agreements | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Useful life (months) | 60 months | |||
Gross carrying amount | $ 303 | $ 303 | 303 | |
Accumulated amortization | (286) | (286) | (268) | |
Net carrying amount | 17 | 17 | 35 | |
Trademarks, trade names, and domain names | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Gross carrying amount | 8,884 | 8,884 | 1,224 | |
Accumulated amortization | (1,238) | (1,238) | (1,002) | |
Net carrying amount | $ 7,646 | $ 7,646 | $ 222 | |
Trademarks, trade names, and domain names | Minimum | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Useful life (months) | 60 months | |||
Trademarks, trade names, and domain names | Maximum | ||||
Goodwill And Intangible Assets [Line Items] | ||||
Useful life (months) | 120 months |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||||
Amortization of intangible assets | $ 1,700,000 | $ 700,000 | $ 2,360,000 | $ 1,492,000 | $ 2,984,000 |
Accumulated impairment of goodwill | $ 0 | $ 0 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Summary of Change in Goodwill and Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Sep. 30, 2021 | Dec. 31, 2021 | |
Goodwill | ||||||
Beginning balance | $ 18,402 | $ 18,402 | $ 18,402 | $ 18,402 | ||
Additions to goodwill | 29,337 | 0 | ||||
Ending balance | $ 47,739 | 47,739 | 18,402 | |||
Intangible assets | ||||||
Beginning balance | 12,567 | 15,551 | 15,551 | 15,551 | ||
Fair Value | 26,120 | $ 0 | ||||
Amortization | (1,700) | $ (700) | (2,360) | $ (1,492) | (2,984) | |
Ending balance | $ 36,327 | $ 36,327 | $ 12,567 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Summary of Future Amortization Expense on Identifiable Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
2022 - Remaining Period | $ 3,396 | ||
2023 | 6,917 | ||
2024 | 6,427 | ||
2025 | 5,759 | ||
2026 | 5,142 | ||
Thereafter | 8,686 | ||
Net carrying amount | $ 36,327 | $ 12,567 | $ 15,551 |
Accrued Expenses - Summary of A
Accrued Expenses - Summary of Accrued Expenses (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Payables and Accruals [Abstract] | ||
Accrued payroll and related expenses | $ 2,811 | $ 5,030 |
Accrued operating expenses | $ 2,146 | $ 1,103 |
Long-term Debt - Additional Inf
Long-term Debt - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | Jul. 29, 2021 | |
Debt Instrument [Line Items] | ||||||
Existing term loans outstanding | $ 207,435,000 | $ 207,435,000 | $ 186,799,000 | |||
Interest expense | 1,700,000 | $ 2,200,000 | 3,000,000 | $ 4,500,000 | ||
Amortization of deferred debt issuance costs | 200,000 | $ 300,000 | 418,000 | $ 694,000 | ||
Accrued interest | 1,800,000 | 1,800,000 | $ 1,700,000 | |||
Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Interest expense | $ 200,000 | $ 300,000 | ||||
2021 Credit Facilities | ||||||
Debt Instrument [Line Items] | ||||||
Quarterly amortization rate | 1.25% | |||||
2021 Credit Facilities | Term loan | ||||||
Debt Instrument [Line Items] | ||||||
Aggregate principal amount | $ 190,000,000 | |||||
2021 Credit Facilities | Revolving Credit Facility | Line of credit | ||||||
Debt Instrument [Line Items] | ||||||
Revolving line of credit | 50,000,000 | |||||
2020 Credit Facilities | Term loan | ||||||
Debt Instrument [Line Items] | ||||||
Existing term loans outstanding | $ 186,400,000 |
Long-term Debt - Schedule of Lo
Long-term Debt - Schedule of Long Term Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Debt issuance costs | $ (2,815) | $ (3,201) |
Total debt | 207,435 | 186,799 |
Debt issuance costs | 751 | 770 |
Current portion of long-term debt | (8,749) | (8,730) |
Total long-term debt | 198,686 | 178,069 |
Term loan | 2021 Credit Facilities | ||
Debt Instrument [Line Items] | ||
2021 Term Loan Facility | 185,250 | 190,000 |
Line of credit | 2021 Credit Facilities | Revolving Credit Facility | ||
Debt Instrument [Line Items] | ||
Long-Term Line of Credit | $ 25,000 | $ 0 |
Long-term Debt - Schedule of Ex
Long-term Debt - Schedule of Expected Future Principal Payments for Borrowings (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Long-Term Debt, Fiscal Year Maturity [Abstract] | ||
2022–Remaining Period | $ 4,750 | |
2023 | 9,500 | |
2024 | 9,500 | |
2025 | 9,500 | |
2026 | 177,000 | |
Debt and issuance costs | 210,250 | |
Unamortized debt issuance costs | (2,815) | $ (3,201) |
Total debt | $ 207,435 | $ 186,799 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Commitments and Contingencies Disclosure [Abstract] | ||
Contingency reserves for litigation liabilities | $ 0 | $ 0 |
Equity-based Compensation - Add
Equity-based Compensation - Additional Information (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
QLH restricted Class B-1 units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost | $ 0.2 |
Weighted average period of recognition | 1 year 1 month 9 days |
Restricted Class A shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost | $ 1.3 |
Weighted average period of recognition | 1 year 4 months 28 days |
Restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unrecognized compensation cost | $ 108 |
Weighted average period of recognition | 2 years 5 months 4 days |
Performance restricted stock units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Vesting period | 1 year |
Unrecognized compensation cost | $ 0.2 |
Weighted average period of recognition | 8 months 12 days |
Equity-based Compensation - Sum
Equity-based Compensation - Summary of Equity-based Compensation Cost Recognized (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | $ 15,843 | $ 11,521 | $ 29,616 | $ 22,123 |
QLH Class B units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | 0 | 0 | 0 | 0 |
QLH restricted Class B-1 units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | 47 | 140 | 132 | 265 |
Restricted Class A shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | 213 | 285 | 561 | 552 |
Restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | 15,520 | 11,096 | 28,860 | 21,306 |
Performance restricted stock units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | $ 63 | $ 0 | $ 63 | $ 0 |
Equity-based Compensation - Sch
Equity-based Compensation - Schedule of Equity-based Compensation Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | $ 15,843 | $ 11,521 | $ 29,616 | $ 22,123 |
Cost of revenue | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | 1,240 | 442 | 1,638 | 842 |
Sales and marketing | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | 2,769 | 1,981 | 5,474 | 3,683 |
Product development | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | 2,646 | 1,665 | 4,895 | 2,997 |
General and administrative | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Total equity-based compensation | $ 9,188 | $ 7,433 | $ 17,609 | $ 14,601 |
Stockholders' Equity (Deficit)
Stockholders' Equity (Deficit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2022 | Mar. 14, 2022 | |
Equity [Abstract] | |||
Amount of shares authorized to be repurchased | $ 5,000 | ||
Shares repurchased (in shares) | 321,150 | 321,150 | |
Stock repurchased during period, value | $ 3,457 | $ 3,500 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Liabilities Measured at Fair Value on a Recurring Basis (Details) - Fair Value, Recurring - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Contingent consideration | $ 4,162 | $ 0 |
Total liabilities | 4,162 | 0 |
Level 1 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Contingent consideration | 0 | 0 |
Total liabilities | 0 | 0 |
Level 2 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Contingent consideration | 0 | 0 |
Total liabilities | 0 | 0 |
Level 3 | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Contingent consideration | 4,162 | 0 |
Total liabilities | $ 4,162 | $ 0 |
Fair Value Measurements - Sch_2
Fair Value Measurements - Schedule of Fair Value of the Company's Contingent Consideration Obligations (Details) - Contingent consideration - Level 3 - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning fair value | $ 0 | $ 0 | $ 0 | $ 0 |
Additions in the period | 7,007 | 0 | 7,007 | 0 |
Change in fair value | (2,845) | 0 | (2,845) | 0 |
Ending fair value | $ 4,162 | $ 0 | $ 4,162 | $ 0 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) $ in Millions | Jun. 30, 2022 USD ($) | Jun. 30, 2021 |
Level 3 | Revenue Target | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Risk-adjusted target rates | 0.060 | 0.125 |
Level 3 | Gross Profit Target | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Risk-adjusted target rates | 0.190 | 0.700 |
QuoteLab, LLC | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Contingent consideration | $ 4.2 | |
QuoteLab, LLC | Accrued Liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Contingent consideration | 1 | |
QuoteLab, LLC | Other Noncurrent Liabilities | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Contingent consideration | $ 3.2 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Income Tax Disclosure [Line Items] | |||||
Effective income tax rate | (4.90%) | 24.60% | (8.30%) | 68.70% | |
Statutory federal tax rate | 21% | ||||
Conversion of stock (in shares) | 297,747 | 357,944 | |||
Additional deferred tax assets | $ 1,100 | $ 1,300 | |||
Deferred tax assets related to additional tax basis increases generated from expected future payments under TR | 300 | 400 | |||
Paid to related party | 1,300 | 2,200 | |||
Liabilities under tax receivables agreement, net of current portion | 83,279 | 83,279 | $ 85,027 | ||
Tax Receivables Agreement | |||||
Income Tax Disclosure [Line Items] | |||||
Increase in liabilities under tax receivable agreement | 1,400 | $ 1,600 | |||
Percentage of additional liability of the aggregate tax benefits | 85% | ||||
Paid to related party | 0 | $ 200 | |||
Liabilities under tax receivables agreement, net of current portion | 86,100 | 86,100 | |||
Tax Receivables Agreement | Accrued Expenses | |||||
Income Tax Disclosure [Line Items] | |||||
Liabilities under tax receivables agreement, net of current portion | 2,800 | 2,800 | |||
QLH | |||||
Income Tax Disclosure [Line Items] | |||||
Deferred tax assets | $ 80,000 | $ 80,000 |
Income Taxes - Summary of Our I
Income Taxes - Summary of Our Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
(Loss) before income taxes | $ (12,411) | $ (509) | $ (21,116) | $ (712) |
Income tax expense (benefit) | $ 611 | $ (125) | $ 1,754 | $ (489) |
Effective Tax Rate | (4.90%) | 24.60% | (8.30%) | 68.70% |
Earnings (Loss) Per Share - Sum
Earnings (Loss) Per Share - Summary of Calculation of Basic and Diluted Net Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Mar. 31, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Basic | ||||||
Net (loss) | $ (13,022) | $ (9,848) | $ (384) | $ 161 | $ (22,870) | $ (223) |
Less: net (loss) attributable to non-controlling interest | (3,883) | (177) | (6,655) | (301) | ||
Net (loss) income available for basic common shares | $ (9,139) | $ (207) | $ (16,215) | $ 78 | ||
Weighted-average shares of Class A common stock outstanding - Basic (in shares) | 41,705,344 | 37,667,432 | 41,279,146 | 35,414,548 | ||
(Loss) earnings per share of Class A common stock - Basic (in dollars per share) | $ (0.22) | $ (0.01) | $ (0.39) | $ 0 | ||
Diluted | ||||||
Weighted-average shares of Class A common stock outstanding - Diluted (in shares) | 41,705,344 | 37,667,432 | 41,279,146 | 35,414,548 | ||
(Loss) earnings per share of Class A common stock - Diluted (in dollars per share) | $ (0.22) | $ (0.01) | $ (0.39) | $ 0 | ||
Class A Common | ||||||
Basic | ||||||
Weighted-average shares of Class A common stock outstanding - Basic (in shares) | 37,667,432 | 35,414,548 | ||||
(Loss) earnings per share of Class A common stock - Basic (in dollars per share) | (0.22) | $ (0.01) | (0.39) | $ 0 | ||
Diluted | ||||||
Weighted-average shares of Class A common stock outstanding - Diluted (in shares) | 37,667,432 | |||||
(Loss) earnings per share of Class A common stock - Diluted (in dollars per share) | $ (0.22) | $ (0.01) | $ (0.39) | $ 0 |
Earnings (Loss) Per Share- Sche
Earnings (Loss) Per Share- Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potential dilutive shares (in shares) | 25,909,665 | 26,716,962 |
QLH Class B-1 Units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potential dilutive shares (in shares) | 19,206,446 | 21,076,952 |
Restricted Class A shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potential dilutive shares (in shares) | 332,072 | 789,999 |
Restricted stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Potential dilutive shares (in shares) | 6,371,147 | 4,850,011 |
Non-Controlling Interest - Addi
Non-Controlling Interest - Additional Information (Details) - shares | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2022 | Dec. 31, 2021 | |
Noncontrolling Interest [Line Items] | |||
Conversion of stock (in shares) | 297,747 | 357,944 | |
QLH | |||
Noncontrolling Interest [Line Items] | |||
Non-controlling interests owned | 68.80% | 68.80% | 67.90% |
QLH | QLH Class B-1 Unitholders | |||
Noncontrolling Interest [Line Items] | |||
Remaining non-controlling interests owned | 31.20% | 31.20% | 32.10% |