TREE - Earnings call transcript Q1 2024

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Operator

Good day and thank you for standing by. And welcome to the LendingTree, Inc.

First Quarter 2024 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, Andrew Wessel, the VP of Investor Relations and Corporate Development. ahead. go Please

Andrew Wessel

and the Justin, financial to joining everyone Thank to good discuss on call XXXX LendingTree's us you, morning first results. quarter

and and call Lebda, Trent the are CEO; Chairman Scott On Ziegler, CFO. Peyree, of President today COO Marketplace; and LendingTree's Doug

Investor to purposes our on of listeners we assume website a today's shareholders reminder detailed have to And the letter focus we call, Q&A. everyone, As earlier and read a today. posted letter on Relations the will that for will

I that we Doug future views expressed remind LendingTree's differ Before and that call his for risks and to today. for to statements uncertainties, hand over could during materially the LendingTree's we from remarks, I subject results make performance. expectations may the everyone Any forward-looking call, are today's discuss actual

but the all periodic filed we with described are SEC. of reports face in our the not Many, risks

press today, non-GAAP both the refer comparable We GAAP. you non-GAAP measures for of website and will on GAAP today's and to a of the definitions also full and I variety on our release reconciliations call measures shareholder discuss to available letter,

with And please ahead. Doug, go that,

Douglas Lebda

call you you, us the Thank who today. are thank all on with Andrew, to and

strong adjusted very ago. Many strong Insurance products in EBITDA We first growth, digits quarter. into Consumer as year trend a sequential revenue generated the double a to from with continue XX% report excited and year are both segment from last to results we increased very quarter second our produced VMD, expect business up our

We demand partners, and from through year. into adjusted with revenue cycle for of the full lender conditions confidence outlook providing are our to to for forecast finally will growth us sizable at underwriting the improve business combined revenue our quarter, part growth insurance second stable EBITDA partners, continues the our return The our company. the worst we

performance. segment Jumping into

auto spending significant with The momentum forecasting has generated insurance a of past now a came last we in us again, customers, new this Carrier us policies for over increased revenue are while increases over the XX% record difficult both to quarter, segment. revenue premium looking record following growth the year. Our partners Insurance from and continued second comp steadily acquire in business to year. in volume and VMD consumers,

Our XX% growth Consumer was performance segment sequential small highlighted in revenue. by business

XXXX As last given lenders. we uncertain we mentioned at on operating call, trends a to margins in decision made strategic demand optimize of quarter's many the our

stable encouraged been some lender at that have remained time. have partners We underwriting most for conditions

And across marketing higher so we for revenue categories. driving the certainty VMD are leaning investments additional into this aimed with in at segment increased multiple product

rates trough homes Home backdrop continues low Our for of the of at higher segment to sale. mortgage and given perform levels supply

most to at and home Our the and expect provide partners the that partners of year. opportunity we home equity our of offering the our for -- in and will trend continue us, for remainder continues home, the

and future Last in not least, optimizing from maturity secured with convertible our XXXX we've convertible us and provide existing retired less or balance next of a free look combination remaining notes, $XXX the certainly proceeds cash loan with flow to we ample Xx once the would thereafter. our meet to of We leverage capital note expect liquidity continue structure cash quarter, sheet but million from this The end commitment new Apollo funds. financing at on the we year. our

us financing, focus business to We our on happy forward. to improving results our financial have which addressed enables solely are this and going

take we And any could questions.

Operator

from Squali question Truist Instructions] And [Operator Youssef comes from Securities. first our

Youssef Squali

environment. just guide, you the on the guess better us help I wondering in can terms of I if understand thinking was your rate

year-end. perhaps even the Does guess maybe to that for expecting or that revenue how hike X X environment growth rate maybe, we went of mid-single-digit cuts guide? risk that by does kind what to that into pose So or X, baked from year? I a much is potential

really guide marketing that I'm the again, trying and control get Consumers, much what guess for you understand within Insurance how macro. Insurance, in is into what guess gives is time? of to to I versus this the your confidence efforts lean I then, right just it. your for is to And I

can For Consumer, maybe the better drivers of you help understand us kind there.

Douglas Lebda

Yes.

Let if plans -- talk that's which in you categories, things and is more And and at have I money a pays more can it run and profile, simple can but in short-term a and And of go that hope lower margin were search margin start increase macro I'll in. for it this past, our and than what chime really cuts we're and see level doing. the do on like VMD very in me some confidence. about -- guide that, We we're the spend other you seeing VMD. of optimizing any your a leaning at in at bids Doug. that we things, that, us to Scott display and for increase Trent across gives increasing a we profile don't when level, high terms demand, for Consumer then Trent rate the

So it's at profitable spend. margin. a It comes just lower

Trent Ziegler

Yes.

any full didn't year to cuts Youssef, macro or quarter, fact the baking were -- otherwise. about last when we we pretty that add in to rate weren't improvement, introduced if Just substantial guide you that, clear we recall, we the

function And it macro We X and wallet get largely it did to into Consumer. to for are increased more seeing kind increasing expected and the of we the obviously question, insurance into right? piggybacking then confidence improvements, of consumer, to mortgage is, out lesser degree, in of Insurance top obviously, year. to we're we particularly on drive your line play a second side kind that the guide the bit and backdrop a the the And share leaning marketing for better in is expect months and similar remainder business, aggressively a year, in of stay so is revenue where

Operator

question comes our for moment Oppenheimer & one And Jed from Kelly question. Company. our from next And next

Jed Kelly

Insurance the in? talk we can Just then, And up, around you and the circling lean confidence stable your in outlook environment comments the volatile. months? lending where should how you should maybe to can segment, talk over-earning? back periods really And how know XX to think what's view you about XX like we you're next the been giving it's about the over about I

Douglas Lebda

you do want Scott, to take that?

Scott Peyree

loans on on rate. the and A just I'll sure. Consumer start there, Jed, that. still the Yes, becoming leaning question lot little has strong To strong segment your on increasing into And Youssef's take question, Consumer. and of to the do follow-up kind higher Personal reality strong for are Consumer of consumers, answer Consumer small has loans consumers Home the just see rates. from more bit of from accepting is consumers. has demand I'll demand, a been equity And those demand. the -- and has business demand you in

level going see, clients, X past as So about a of with a see seen there's up, tightening delinquency. the months, when of leveling uprising stability XX standards really Well, over rates we past constantly XX, that. months, to X off we really, kept the concerns we've were our their they over

partners client not anymore. they're tight tightening still our but So underwriting standards, have

stability RPLs but continuing still of time. So where don't that general, a high lower we level see demand, lower RPLs chaos to over given consumer us we have in see we of has overall and do the

focus they're consistent more cross-selling efficiency, with they're to be few make projected operational with models primary campaigns with more make more us that, us. product learning alternative the on in our can't over projected with effective consumers -- products, And real pricing our our more and past of buying our to products I've calls, talked our better sure profitable a So marketing, open earnings clients further media to about efficient. seeking consistent be when revenue lets right get they're up as the matching everything budgets the

revenue media can And attribution the use that smartly to end models at of machine our the media. learning algorithms better buy more day,

those these added media where market in profitably to to out the for of share are ability things marketplaces in shopping All products. important gain have consumers up there and lean our

in year with in LendingTree. bluntly And down been through what's the we of happen happening past even to environment to few in we're excited expect the end and months the be honest, what this pretty

it's clients months. our days. local opening are everyone new big whether back. We believe of fully up that couple it's back, buyers, continues board. the across say over months, say would next And just is, still the I I a I XX But in your our and they're It's picture of direct Insurance seeing fully of corporate number whether it's agency, back states We then up. shouldn't we question writing -- [indiscernible] geographies through have broad-based whether on answer because and Insurance mean, to opening policies agents, not is products [indiscernible] it's it's even a

ending believe period a I very profitable are time. that in carriers of

front the the call end on the to demand. what a in super of profitability. insurance where carriers next we're have couple return policies of feel high years, of right cycle to But I due you rates now, high I consumer in So Insurance

XX% while. And for was demand a to consumer for year-over-year just QX, that's up going in Our shopping quotes. keep insurance continue

So Insurance I in think we're on runway right now. a long

Douglas Lebda

-- little do a you on Did Scott any that? And get breaking I was you there. bit have know up follow-ups

Jed Kelly

was clear. No, it

Douglas Lebda

Perfect.

Operator

question Ryan KBW. next from comes our from And Tomasello

Ryan Tomasello

segment, VMMs year. the start guide like Consumer, guide. by maybe pieces guide for for revenue curious to baked different the being XQ Overall, here how efforts. much the all driven wanted the more increased of increase But some just of the can by for by sounds and driven for full us you're unpacking some growth handholding marketing Insurance. give the It just trend the guideposts on just year I by being and with for it revenue driven to by if into is segment you Insurance versus alluding the of moving

Douglas Lebda

on already majority in second Yes, mean, guide, is and Insurance quarter. and month into we're the on full revenue the vast the year I driven it's that of what the based happy to. by Yes. seeing

high quarters. stable our of and carriers expect, running it QX, last high continues right? talking as been naturally get we the consumer and more profile, for trend we little it's opportunity about, of relatively assume in one expect contract to where in the to that back would And the many those healthy. a on been as the But bit aggressive, both half margin Home remains the to remain some were last continue that couple would a compared as down XXs, competitors unlock of very XXs As expect businesses. a revenue do been bit. And in relates there, we've to we margin right, argue dynamics to margins little Insurance, so, it's year, the based they the then we low of profile in of sort will to and high

And down closer to back XX%. so tick we would expect those to

Ryan Tomasello

by growth give Trent, revenue And line that you segment, can on then any color just top us?

Trent Ziegler

I face the QX, said, that comp by Yes. stopping business, guiding growth The short as which segment. Insurance incremental of relative toughest most that increase. is we of clearly, mean, driving in we last to year. is Double-digit

So we'd continue accelerate we throughout expect to substantially pretty as the year. that

revenue The incremental would that contributor there's year not other I a upside, -- say, increase of consumer a on full modest businesses, basis. ton are incremental to

Douglas Lebda

spend get dollar. go And we incremental our demand comes just is and which model Yes. exceeds from business efficiently remembering to the for and the things the and if we and flywheel, lenders, is profitable keep lower everybody, is, the go mark can up more thing we margin, then about one as we I'd we it go companies, great fill clients, out customers. only at get can up. then last to add that flex we demand insurance It's of That supply do core as customers, business

generally shows seeing is percentages a higher of So health and that the dollar that margin demand higher lower sign a than for because a it of is of of business, VMM supply. me,

tell wake I we VMD people from standpoint, that literally every and can say, up how wanted just make so, day to to of generate. much point a business we And like

absolutely each their given we're And have of the last level. at segment demand this thing thing clients. put other right, I'd say marketplaces Trent's demand that like we think we've of The increased dynamics. like the these at about the overall, comment is from I around few guiding product any on that net years supply not around at is can add everything Scott seeing The diversification great is said the and in time, different, own just

done We're a lot a of team are at and operational some credit have just stuff that on Scott to also in short-term -- and better give that things and putting hit this, I'll his on. lot Scott efficiencies

in. so And we therefore, can lean

Ryan Tomasello

margin the finer a some just put to on of And last the reinvesting into marketing. here back one point follow-up

into Just do I be of expect revenue despite when trying should here It marketing to translate seeing the to understand why to spend VMD mean, guide the up. start we're dollars? expect these efforts significant we up sounds you not guide VMM the profitable. like to more

to takes and trying Just the puts there. understand

Douglas Lebda

best can, to I mean, effect do margin of always better. and -- of that and we to couple we're that the and say flexibility wanting I beginning us to we we Yes. would some over do -- have sure just and But want and to safety. it wanting make to is we give last try the margin there's the not that conservatism certainly of can enough this we wanting for -- so months,

Scott Peyree

to only the level. and key with level clients our the our to have, the need percentage the higher that's It's gives revenue more to just At to optimize share, certain have in us the -- for relationships opportunities more your future. some more the higher At which options expanding end you to day, a -- want run. grow optimize it's VMD our of significant clients, margin to over market long to important also, you grow we could revenue,

might easier And next the little time, increase. even it that's to quarters, expand we're you overall, few the over in to taking. So VMD definitely bit the margins is overall we're revenue expecting squeeze route VMD. do though your And a continue the overall more our to

Operator

Inc. question Campbell next comes John our from And from Stephens

John Campbell

XX first the quarters, time talked raised been the you this a long revenue. it's So first think, -- a about in your is, also think we time since It's revenue I I guidance. time

click potential double great. of click the measured like business. are is that the to cycle. some I on seems feels stages turnarounds. on early the it It making So the you guys like I pretty Insurance -- mean, super But wanted

does the recovery, kind or than mentioned mentioned -- feel you you driven by not it's bit much Scott, broad of and customers. Scott, X little But I This think think, a just it that. cycles. I time, past steadier far as as broad-based largely also so X

the was last have I pump, of maybe large think I customer. we kind one think,

the then, want agent versus maybe I more you you and across this know if But unpack maybe could versus go quarter channel? the leads don't broadly click to carrier results of, if

Douglas Lebda

that Scott. gaining a is we believe share I And everywhere, job we're was just of focused going on one is Insurance, Insurance there to that. but very the say versus position definitely real thing leading because we've I and competition. have Take done very quickly, good away, we think a really

Scott Peyree

year-over-year casualty but and broad-based, X XXX% compared to growth, to those being a over I direct had huge last property click of about largely is buyers, Yes. carriers Starting talk just calls because different have channel which But different lot clicks at carrier QX the the -- level, corporate things. our even are than the top and buyers versus leads corporate all the buy corporate year. better grew think versus buyers

maybe, were the your was couple year it's standpoint, board. across X is really maybe growth driving corporate a point last not just to or X, -- being that carrier it the from of the So broad-based

Insurance all expanding. division. in the expansion we We're compared And QX expecting over them all they're to revenue ever million of probably We're record. all-time the will going time be significant $XXX in to It from do do first QX. an sequentially

big On but QX. percentage shift. over it the record local of in up double-digit agent, I that -- It's was was slowly, in an more all-time wise. a mean

it today, and size opened staff we running the agency our KPI telling agency, models, as is up our management very size we're at ourselves, that look us should we write that today. carriers is profitably geos and be Xx where business staff Xx the have Our products like enough our

of diligently we're expanding in So agencies. the process our

So are the expanding carriers, also agencies the dramatically. right through independent

this fully And really it open So to like are an board. -- as month. said, carriers continuing is up They're at point. just each answered expansion the states It's the completely it's all these earlier I question, of open continues. across not

John Campbell

of to at if just or that beat that I on what I so then the that just right? had, being, to think, was maybe the And relative all Great least mean to HELOC. I key hear. thinking ended I'm a given Home Is year-over-year, relative it, driver appreciate XX% But the I model. strength we color. our up mortgage unpack in down segment,

Scott Peyree

said is end have the been, the pleasantly QX sequentially just did be by, Yeah. surprised Mortgage -- mortgage, the was And equity just grow year. equity But this is bit from going Doug -- to QX, I think your probably decently point. as down as it's XX%, to a mean, But QX no. was down from and grow accepting year-over-year. are Revenues And of I there I we we more and Home lot expecting big pretty little meeting, in the that to the driver steady rates. I to from of was overall through high of more significantly top would driven pretty that's at mortgage and consumers it well. think, a say, decently QX are of Home been

so a for but increased seen an And very honestly, But as you're uptick low well. we've seeing shopping local. little products equity in But it is a still bit level, mainly. refinance and purchase at very home behavior

Douglas Lebda

one, home equity I'd just thing mortgage add are highlight only on is, The the on fungible. to basically that on so -- mortgage and

-- you home fit The a loan look separately, think to necessarily will them. looking if best it. doesn't sell has at don't it that way best them it's for I at So is not are consumer's -- the the companies mortgage

get then they house, make if of mortgage certainly there not values debt, up. from than and sense it card credit lot make consumers doesn't et a people, home for a are so, home cetera, better refinance second and and can prices and sense who a are And you're benefit purchasing loan, to

seeking Scott So home but natural doing, comes are just which just it's future back in just And substitution trove in have purchase, Home little that long market when be rates as segment. they'll the of for rates and a lenders this so basically certainly, product more a consumers see. are in in rates are treasure made even equity high we're to conversion really starting said, is there, purchase aggressively fall both refinancers when these for a bit,

Operator

Wedel Melissa from question And comes our from JPMorgan. next

Melissa Wedel

a follow-up quarter, about and I was together the QX in Consumer. on across on certainly from it hoping to also the hearing for Home strength increased both based different strength piecing just of comments earlier like into second comments growth sequential couple sounds in through sequential revenue the Insurance the coming segments,

Within that on onboarding to I just about or was note being seen of that hoping business bit. And could we TreeQual any reference from Home in shareholder trends Consumer, be elaborate that current little any maybe then comments a your seasonality sort absent we did in America the by you've as the Bank speak noticeably you that to to small trends should of think driven and sort of letter. historically? equity

Douglas Lebda

Scott why then you on. that start And don't add Trent, and

Trent Ziegler

Yes.

partners as improvement, expect is is which the where cetera, -- which Just obviously, et reasons by again, now. see growth Insurance detailed. I we it encouraging. geographies, just We relates sequential driven up continue mostly to of to right driven the by some opportunity is Home the Home, where opening which for opening equity, is in do lot up sequential mean, budgets, is a Melissa, Scott that

expect trend tend in Consumer, a QX to things and to into small would seasonal to I probably point There's seasonal then and a mostly those businesses, personal up to And to loans we pick QX where QX. component business.

the we're and year. of the ultimately on of and not excited a guidance about expecting work certainly future But business there, ton around while us. TreeQual, going particularly think we're The tackling at chip for some in blocking partners onboarding we away we're the continue product going there, around to business it our the the to card that's of -- the and new baking of not for that TreeQual growth of into that kind business, that's or rest

you that? do want to add to Scott,

Scott Peyree

maybe and almost with single I to -- I honestly, improvement believe Yes. industry are up little a we just in we see more bit I and operate like, might every mean, the major in, comment put I credit card. just exception going of sequential do we're seeing revenue

but marketplaces deliver lending a And growth we've loans, home so -- growing, able mortgage, our of believe growing, of a be the is important the share to market lot we're in equity, it's small work and things that loans lot we with board. seeing I borrow and drive have hard it's in more And down business environment, are to take personal -- mean across work the the and some proper to is media it's traffic. traffic we do deposits, done clients distribution the

revenue So pretty QX. good to pretty I'm feeling about from growth QX broad-based

Melissa Wedel

consumer I in embedded to, see should product there's about you typically is But of the terms in just of anything understand that we right for typically equity? Home in an of type summer there do increase housing months? asked around behavior or prices a think spring lot demand seasonality Certainly in HPA I now.

Douglas Lebda

normally of like in see of It's normal. need. and based of would the that a product. normal of seasonally equity. seasonality products more that's not rest on QX seasonally our them lot Home be one really more lot don't that would a say be There's We I'd seasonality just consumer light, in

Scott Peyree

growth If a see home loans, of the just halt. come in a and in equity, more fact buying has more I more Home equity it's homes is crashing I but in lot seasonality see of you some would just think that purchasing personal to the --

more lot back a are home to or turning consumers whatever of just equity, remodeling selling. versus So

seeing So that. we're because there growth of

Operator

Michael Northland Grondahl from comes Securities. our from And next question

Mike Grondahl

One, the of then goal quarter? you what's TreeQual disclose Kind Two of card significance And on the first about that? or revenues getting equity could did home for BofA talk in into secondly, credit kind guys revenues your card the of you questions. side? credit

Douglas Lebda

on give integration a consumer the Scott Getting significant gone of point offers to through a sizes. BofA I'll different TreeQual a add to financial issuer that from where will XX the first fantastic we've take the you standpoint one from we of get -- better can in those types is multiple consumers, and all and need standpoint, And you on card probably issuers experience. and of that to lead to the of landed that. let part

So a we've got We've interest. of lot pipeline. got good a

We the have we walls consumers of got product like people to live, be the crazy works, clients replace it's get to enough but that business. it, click supplement like to scale and/or would it, able the credit card

Scott Peyree

question, Yes. $XX.X It quarter. And disclose in equity. your anything total on home kind our then, XX% of or release, for more was revenue. Mike, second disclose the revenue that credit revenue in We disclose guidepost we of the not as press we is million card did and did

Operator

from question And [indiscernible] next International Instructions] our Group. [Operator comes

Unknown Analyst

just being balance math million cash notes? the convertible notes? about sheet there's XXXX take between balance still you the through million to it the cash the convertible $XX of looks Can out the walk of a in you XXXX like July on balance sheet as Because for necessary once the $XXX on and gap keep significant remaining

Trent Ziegler

free new mean, on we the I money. excess we cash of can we million that months. course the to flow to cash then the over of sheet $XX work. remaining and that $XXX balance feel Yes, we like balance Yes. million flow think put could There's million of next more XX the like $XX

Operator

I like the for turn remarks. back Lebda, further questions. would CEO, Doug no to showing closing to And over now I am call

Douglas Lebda

you they from for and obviously here. the all several demand us pulling for Look, you back debt thank business had to we repayment. which and shareholders. easy the faced then for and us being not you, to been and have as looming RPLs forced business, easy have Thank clients, rightsize certainly not years, a over last The

the gripping chaotic our actually working approaching are that some what from things things. schemes However, of more really and and couple together. came very operational operations, in and and our areas other of good Scott finance much Today are his with and improvement good operators closely very, years company really team

will financial new and process On think discrete of product in returns. excited we that's and got able there, now with to the some projects new future. a I I'm And be key product work results tech, positive from number to shown hope and a are we that We've that on have TreeQual. showing you people

Our financially, bodes and think future. and strong clients the I are optimistic for that well

Our be some want taking up want you continued and and company all are in this I of to look to to And as the growth to growth future. to win. company I forward to stick-to-itiveness for employees I you and all. profitability guys with thank you and our hill continued thank LendingTree, fired Thank the showing win your plays you.

Operator

This conference concludes for you participating. call. Thank today's

You disconnect. may now

LendingTree (TREE) 30 Apr 242024 Q1 Earnings call transcript