EVER - Earnings call transcript Q4 2024

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Operator

Ladies and gentlemen, thank you for standing by. My name is Desiree, and I will be your conference operator today. At this time, I would like to welcome everyone to the EverQuote Fourth Quarter 2024 Earnings Call. [Operator Instructions] I would now like to turn the conference over to Brinlea Johnson with The Blueshirt Group.

You may begin.

Brinlea Johnson

you. Thank welcome Quarter and XXXX Full EverQuote's Call. Earnings to afternoon, and Fourth Year Good the in results issued discussing be We'll announced the closed. today our market after release press EverQuote's this With the of EverQuote. Sanborn, afternoon Chief Officer Executive are Chief me Financial Officer; call Jayme on Joseph and Mendal,

During we guidance of including laws, statements statements our financial will related that quarter our business securities the be the considered federal the call, for XXXX. first may forward-looking make to statements under concerning

with identified intend, should be only as revise or Forward-looking any and upcoming phrases similar as believe, may statements, statements today forward-looking phrases. not these views expect, as words our disclaim views obligation reflect of anticipate, and to and by such considered as required except law. of our may, any update plan, be specifically These subsequent words and statements date. We

are Forward-looking could results the actual subject variety uncertainties and a materially expectations. that statements of cause our differ to to risks from

as website. our referring available Relations risks Investor section this refer of marketing margin of to investor and variable to a dollars uncertainties, annual on quarterly on Exchange look Form to on and with Securities Commission VMD. to note, including filings, marketing starting and our year, or communications, we the be Form and we simplify Also will our variable as reports the For our our on XX-K SEC file report discussion those XX-Q please

a variable of forward, Going margin will VMD or marketing percentage to VMM, revenue. refer as

GAAP which included close issued press Jayme. to investors. on that, the measures, website. And section of we call, to Finally, it of Investor of Relations during helpful available we to our which after with market course believe we certain refer reconciliation is release are today, the in measures turn I'll to non-GAAP financial is over today's of the the A non-GAAP

Jayme Mendal

insurance thanks exiting which auto XX% to thank over entered the year for nearly sheet be insurance the state our by entered balance $XX to time, Many as of efficiency marketplace the by XXXX as remarkable carriers carrier The unrecognizable and a grew auto been, team million downturn. and we an agents unwavering of of over $XXX over million grew improved ramped revenue EBITDA mark In of debt. of year, for cross enterprise the progress participation The $XXX our rapidly the the joining the you strong over adjusted Brinlea, would XXXX, improving carriers it's the no growth operational million. helped you, to XXXX, we We year-over-year. from EverQuote is EverQuote ever and made course almost Thank all last us support XXX% today. sheet. In market. to to XXXX them emerge strengthened year. to first on growth, in with balance cash accelerated Thanks and the business contributing the EverQuote, and in

with achieve local QX, ties business accelerated despite in continue agent year agents. challenging the the of year-over-year start course local Our growth build to we in to QX and over also XX% a deeper

a for customer been never balanced foundation we sustained Our consequently, relationships have have and better, and moving forward. growth strong

to by traffic customers' enabled our operations. ability was return in growth Our strength support to

often of refinement XX% QX They solution. consumer AI-powered a now backdrop, year-over-year and execute and marketing to became and Our a prepared our fast by initiatives in to team changes competitive our significant their focused sudden acquisition ability growth Last bidding through as moved margins. more and industry nearly the landscape healthy demonstrate remarkable made this year's customer continue volume to budgets did carriers dynamic for so at rule. Against in teams traffic operational FCC and continued a environment. as vacated improvement grew rigor,

simplified site heavy and we broader more suite front, and technology and in immense customers recent placing and emphasis of development beyond, features. In modernized investing facets seen of continue the in in better can across run. The experienced automation our a platforms tech year, releases technology efficiency, forward, with of our towards and strides, to more we for faster are business. the last and on throughout business. over achieved this of stack be of new On enabling all we AI made agent leverage operating impact products the the tools have Advances the room great moving advancing as

With of opportunity hiring mostly leverage the taking disciplined year, to ramped our culture. In team in focusing make our in we a are highly high recovery the roles. the business, last way, and technical strong investments we our on

a also in-person a into collaboration. policy to We and our to new highly and place ensuring implemented is enhance our team committed extremely offices and space We to EverQuote remain culture return-to-office work. strengthening upgraded desirable

market. some As share on which the insurance profitability. first we look to I'll the underwriting I we healthy broad-based returned we've landscape with believe perspective future, to auto the operate, beginning current in

market, in come. The rule, reverting to and see While implemented to prominent of in another we several wide also The states lagged beginning lag, to ratios, return a to preparing vacated to implement changes, the courts dynamic consent response After rule, the pre industry We X:X the industry changes healthy the healthy to back as in FCC geographical continue new growing homeowners carriers requisite have has a bodes much has recovery of the consent. was budgets. last which the X:X for spent campaigns XXXX. the its landscape that year referred state. restored whose insurance and to most well underlying year footprints is with carrier regulatory combined to which demand carriers auto,

decided have we strategy. they our where in our back and changes customers While advance keep place entirely, benefit many to certain others rolled changes

us favorable we Looking EverQuote's ahead, the the nicely based on backdrop X:X aligns foreseeable regulatory future. consent with sharpened the This strategy. posture, for administration's current behind believe market requirement is that

bigger to three, a in P&C Over insurance to providers XXXX across traffic partner this advance and two, make growth have to significant progress of refocused year. the products better last one, and expect year, suite delivering: our oriented #X our become by scale; the vision fronts strategy we and to broader upcoming all and services. We efficiently performing referrals; planning clarified the

enter confidently the we the we history, but can XXXX, have from weather for sustained, As downturn insurance with profitable ingredients only not in hard did we auto the worst performance in come. all emerged say I growth to U.S. market and record strong, the years that

of on healthy P&C, us sharpened more increasingly fully the this We growth-oriented allowing serve market. and needs have our focus to

been that is with team capable, and Our quarter-after-quarter execution has hungry. improving a hardened

into providers' in to last the been now proud teams carrying technology to moving Our look have the our to supporting enabling I'm and XXXX. I'll what incredibly discuss results. growth has forward. year and accomplished platforms insurance contributing the Joseph call over turn our to streamlined, team us of efficiency to move and over faster financial forward momentum the

Joseph Sanborn

all start what results and by financial sector discussing for our quarter Jayme, the you auto the we and before seeing first joining. our you, in are the XXXX guidance thank I and fourth update XXXX. for of year an currently on insurance full will Thank providing quarter for

revenue income, to EBITDA. X These guidance adjusted as were X net Our financial as all or again and impressive marketing financial of due We dollars adjusted primary a of achieved exceeded factors. revenue, as level we variable primary EBITDA. record strong well a and continued record results QX total momentum level our VMD into metrics: across of

strong the our execution and battle our teams, to auto and carriers continue downturn, First, we laser-focused agents from helping carrier who grow experience hardened operating emerged on from P&C profitably.

on our better $XXX.X benefited technology deviation pattern from also increasingly And the that our period auto leverage fourth X% to leverage investments carrier million, the data assets in XXX% carrier quarter was from nearly year P&C QX the revenues driven was XXX% to the spend, comparable from stronger seasonal created allowed us sequentially period grew in third platforms from in strategic primarily prior from quarter. has favorable positioned landscape. Total Second, declining up incremental a us benefit last focus growth our operating significant model increasing the which efficiencies. enterprise sequentially, our and industry of our from to Revenue and drive up we by operating year. an and normal finally,

insurance in QX, our in grew also Our auto million $XXX.X agency was XX% over year-over-year. operations year-over-year XXX% vertical up QX. Revenue from

year, full to vertical $XXX QX, Revenue the year-over-year. XX% up from our our insurance grew XX% from renters and revenue vertical auto million in home For million. insurance $XX.X was

XX.X% from For approximately the up drove for and was as and through in XXXX. VMM, of margin, fourth we marketing to home year, million, as progressed year-over-year. VMD quarter. XX% year Variable million for percentage as VMD XX% XXX% $XXX.X increased moderated prior VMD Full million, for revenue period. full ending $XX the XX% which a the period, renters record quarter, our approximately at is up of $XX we up revenue to full insurance the fourth year year the from expected, the increased vertical or

the line. expenses bottom operating Turning to and

in continue leveraging We disciplined to expenses investments in our be technology managing and platform.

have expanding driving efficiency top successful line growth. of In and income million. we as our net operating across reported record operations, fourth been is drive the which our We incremental in we $XX.X scale leverage quarter,

million flowed full compared our as Adjusted a also approximately prior remained year, $XXX,XXX leverage million from of of loss an QX, EBITDA quarter in For in a the as $XX.X of the period. Adjusted higher was income net benefit to EBITDA. VMD to the record, improvement operating revenues through XXXX. to in strong adjusted from at $XX.X a and a percentage million loss in EBITDA year XX% increased continue $XX.X to we

expenses, from other spend XXXX. cash EBITDA quarter. $XX.X of fourth EBITDA which debt from in advertising equivalents the in million the to charges, year $XXX.X and compared cash no For with up were operating one-time the ending Cash to $XX.X and an cash increased for operating strong the $XXX,XXX of previous million, noncash of end million full year, $XX.X at million of excludes $XX flow million the adjusted QX, XXXX. quarter, certain delivered and unchanged We and adjusted

provide are seeing insurance benefits the remains optimistic representing Before will are which channels preferred growth firmly to intact, digital insurance and ability desired an auto insurance increase XXXX, this are normalizing of carriers advertising to specifically the XX% spend have the rate after up turning continue profitability largely first forecasted that and to auto beginning we growth since want on same XXXX, rates over outlook auto given With underwriting more more believe also time, we long-term auto year. avenue remain the that channels the of recovery shifting normalized quarter. that update premiums the believe consumers. levels thesis to a At lead focused broadly the to premiums in we with will revenue expect return target in achieved We to our we from auto for of industry. to the guidance, on our insurance I current digital

to turning for Now of quarter first guidance the XXXX.

expect at million We to representing $XXX $XXX be year-over-year and million, between XX% revenue midpoint. growth the

to We midpoint. million growth XXX% to representing year-over-year the be the expect year-over-year $XX between million, $XX EBITDA $XX between million we And and and representing at midpoint. adjusted expect be $XX growth VMD million, XX% at

XXXX. growth. to want in that long-term X:X our consent to half an position transitioning investment operations anticipated update plans to and had share we we requirements, the associated our technology the complexities on our you plan in investment with data for addressed We to to with we once fall, EverQuote assets also XXXX outlined for of operational second increase Last conform

competitive attention investment Circuit's to This products are offerings, positioning investments key As accelerating already regulatory this late develop a and leveraging expanding EverQuote drive capabilities XXth providers insurance have growth result for moat January, to essential started future management we of entire to across operational strategic improve for change greater believe terminate areas. includes organization. We existing AI in revenue building new to key capacity our powerful and more redeploying these focusing in on decision with profitability. and our strong the efficiencies

investments, with we margins and current balancing operating be will structure to levels. In an in XXXX to generate disciplined as these to downturn continue or leading all from cost financial and metrics expenses in our stronger emerged make of company at EBITDA refocused fourth a summary, across adjusted We position. continue we strategy, efficient delivered drive a near outstanding As the results auto record the incremental a market we insurance key quarter.

technology growing As successfully support assets expertise, are we excited we and our providers traffic and ability insurance into continue to business. our very about look leverage data their XXXX, to our to

your their and questions. for long-term Before dedication we Jayme a on remains take Q&A, profits now to want hard team shareholders to for take and and to value. for continued I will moment turning their our our support. this and work Management shareholder driving thank year growth, laser-focused

Operator

[Operator Instructions] our from Michael you. Thank Graham And Canaccord first line the of with comes question Genuity.

Michael Graham

awesome on and you quarter. congrats Thank the

X Just ask wanted to questions.

you down. know I guidance. growth slowing kind of your referenced premium on First,

stats balance that you growth in QX, about referenced I the then was think to moment really sort in growth to to last the overall premium expecting you a in slow XX% saw maybe year. And growth market a little premiums you relative of think spend I I have bit just year. X% some the a framework of the understand market? strong help with to just after you that. of Can expect relative after sort should us where growing And we a guys follow-up down trying

Joseph Sanborn

for Mike, question. the Thanks,

So just giving environment. on the you context

year, through for in to getting a geographical had a growth the backdrop on of, to XX% speaking, profitability, industry and you're the broad end providing stability carriers generally in plus of insurance broadly footprint. comments XXXX last underwriting carriers premiums where guess script the we've I healthy referring for So backdrop our the the very getting gave auto are in

is be into think What if growth we last as of thing. the context the you probably of the line the that we We see towards this for look how had we which year, seasonal exactly guide. continuing things decline, tends you look see pattern. you to it. never say QX, growth. mid X it about and various So is plays And digits. shared of more QX would of of one of broader year, have normalization is low second QX, to X last impact follows, the year seasonal tends long-term is we to percent. it here perfect from is happen at out, sort in to tends average to which does the And a the extraordinary things. One, macro there's we is look our a be through start be to last down you it single-digit which that we'll thing I'd our And tool quarters top that the QX, as quarters in last But as we've you up and rate. be the look high our as obviously to we've normalizing, XX% midpoint the and internally, year, percent, QX EverQuote talked mid-single given usually pattern said, -- start we'd the analysts, as single-digit it of growth growth, in but with sense past, use being year, the X single QX to digits what see that sequential it year, sort other sequentially to can

our you average, rate on about of rest I the pattern growth for think sense a overlay that the that with So normalized year to give of top seasonal line.

Michael Graham

the then ask your And just I to Okay. other operations. traffic wanted one is on

ability the kind to scale of referenced few a You times. traffic

depth of add if are layer you for a things there. working some You wonder referenced could I just investments around the there. that some you of

Jayme Mendal

Yes.

of number a things. there's So

two, like has to just the Mike, to team's operational changes volatility years, to of traffic and better better rigor manage is environment norms to the I And that often. to over us that really is of had operating the a like bidding course that a the continued experienced we've react last of in quite dynamic platform. tightly we've point the that. Number of think where the I'd get over couple set business developed sort market the First, allow

has kind of and that over get our last effective improved traffic work this and the out about really just years. with have continues couple passing This a made course bidding the of that before and every more and that automated platform tuned building to traffic more ML-based lot we've bidding we've with been we of So talked of data more quarter.

big a And been so that's the success. of team's part

marketplace, channels back period for it's for of it see into time less that, expand come to just Beyond partners us. monetization that the And continuing were channels, unlocked a grow. we has where as profitable to has to opportunities continue

Operator

from question Carpenter Cory the line with next JPMorgan. Our comes of

Cory Carpenter

changes of about X:X the remarks some in order You consent the comment prepared stayed. being made a maintaining the despite

of Just Joseph, maybe, us? we just but hoping maintaining it, could have that, the think relative on that you stayed, and now for And relatedly, financials to what about some the you're still impact how of rationale. just you that last kind elaborate you X:X consent then quarter for of should that's to going was on framed kind

Jayme Mendal

the I'll Yes. of take part question. first the

The that that of outreach bit a connections perspective quality over lot -- related changes X:X the of from giving consumer about to consumer the control the of whole consent really the the receive. they the a more So net higher were the -- really is putting result agents.

and there's a they agents the to lead So performance hasn't be and explicitly the that in experience. win consumer, consumer it's now if -- the better that opted and/or competition on more going less the and higher, lead consumers of is

So there's it, of win-win for which is aspect the a marketplace. sides both really an of

of leading sort We've being not is we in customer. take in largest, back, a market. that also with part the EverQuote's investing the step providing been a the And you the extending to leadership highest that position. agents if have Now quality only product a strategy, of big but local position

point minimal we improve to the some testing that X:X of the implemented of product able our to the do enabled with so trade-off we quality the through or economics. changes were were to And to agent. where we a it of optimize so able to we consent the really were tolerable us sort And delivering to

to them leave with And win-win in so pockets we in very much that sort kind changes continue sort of have found around them of in implemented, where line place of strategy. to these build our of we and decided we

Joseph Sanborn

little percentage for a VMM you. bit Cory, I'll on address

was little we under We some QX just the into came QX XXs, XX.X%. high in give to context, said XX%. go just a So that we towards and over things at just

for it look XX% implies range, sort guide of midpoint, XX.X%. of you our QX, for sort If XX% to XX%,

we'd some to as impact So look keeping do at And opportunity a do to broadly we modest margin. that operations as so impact of X:X think at we at sort traffic net for clients. The an there's year as of XXs high how quality is also XX% the view. sort in is more with we place relationships go say XX% sort as looking just high going Jayme of described margin in what the the past bring rest the our of we to out forward, we look continue of long-term stronger -- now in our into building see the sort assuming impact the this of of that about in current XXs of we of our VMM stays for quarter, you

Operator

question of Zachary from line B. Riley. with next comes Our Cummins the

Zach Cummins

Jayme and the strong Joseph, congrats results. on

consent Just of some acknowledging the some being rule, of feedback of on double-clicking of to more from getting maintain curious the you're a little are in standards been From carriers the wanting X:X place. with carriers. I those my ruling was the vacated. you've that some FCC's standards still the vacation just some understanding, keeping that of even

Jayme Mendal

through the that can of think I the some some -- product lead of carriers the laws. a remain are of testing data, data their requirement We've major not limited you as we higher X:X late the no quality mechanisms their majority anything The data consent had there that try beyond the probably So rolled generate carriers the of saw folks the have the or put implementing do the is out providers and Zach. concluded, year have carriers they that that agents I that's with compliance last impose some the think by of that. sort and of out. accurate, some had in -- carriers partners,

this agents willingness it, think there's benefit the And and to and there so is for appetite receive I And the from too. and themselves some interest pay from carriers both it. continue product from to to higher-quality

is the pricing and is requirement the some of to come higher this portions kind follow some effect, the maintain has so forward to of the increase And traffic. product changes with in path at without, that these performing, our sort we've that just of of of or higher-quality with along least chosen move maintain on

Zach Cummins

follow-up you like here. they broader the And the go can my been is speak profitability is, underlying you've question board one set from into feedback Understood. the as across getting of seems just better just XXXX? carriers to It

the of just what hearing So you're the maybe side maybe enterprise business versus from of of some curious the channels? agent-led

Jayme Mendal

one my seems is the follow-up you've better as It into carriers like speak you getting question of profitability Understood. the And they can here. been XXXX? is, underlying go broader just from across feedback set board the just to

side you're of say from consistent. So just of the maybe curious hearing I versus somewhat maybe business the some agent-led enterprise would of channels? Yes. that, what the it's

underwriting homeowners, handful I the time, to are carriers, agent-led are in are auto carriers first which My Even wide converging. a handful the returned is, for broad-based that of a healthy back enterprise, lagging the There states, But the are kind really we've sense to auto. bit. footprint, channels most of profitability. was For of think direct healthy a and a geographical lagging. small budgets pretty handful

latest to If return at of healthy some a seeing ratios you as prints, home in combined look underlying you're well. the

orientation by growth. is large, think, swinging I heavily towards So and the

sort seen the is back much checked market profitability the box of across on focus we've I now think of the growth. and

Operator

of from Needham with comes the line & Tandon Company. question Next Mayank

Mayank Tandon

the Congrats, to an drivers. of a Jayme wanted done. the in get on and Well underlying just understanding quarter. of terms more I Joseph, bit little

provide it the Any some growth? could of on would thoughts on there? Is RPQR? bundling the hear is So monetization. is it like-to-like you pricing? And and/or underlying unpack the drivers behind curious What traffic details you the more to driving and of be between growth sort can just more your growth

Jayme Mendal

year. think story last I a it's balanced growth been So the over

both in as consumer monetization. well our volume, benefited So we've in as growth from

in had the bit monetization. if scale double-digit you I and XXXX across growth to the in sort tip look a volume favor think at balance X, of we would home. But auto had consumer between of the

have driven kind XX%, volume those things. it's get there's growth when of a both both year, last you growth. and growing, being that of you And effect the produced monetization we really XX% compounding so and So by that

Mayank Tandon

maybe I'll over sheet. in the balance to healthy the then is shape. And very Obviously, switch balance sheet

allocation? acquisitions of around Joseph, thoughts, potential in process any use around know M&A thought and you've So I capital cash? is past. the What done your

Joseph Sanborn

Sure.

say when at I'd you ended So million we're it look you in sheet, cash, before. $XX from $XXX balance year the we put year up the where pleased at about the million context, obviously, in

speaks the leverage So progress cash flow model. I think the it to in the business and in in created the driving we've

So that. with pleased we're

As of our and that's we how X think I here. investment why about that impacts use on capital, areas touch

So of business. in organic first, that we're to doing the think investment

of really As horizon. do, types you start think make investments the we sort will to on about in over platforms moat time. have the start help things, that and and cash starting competitive investments When how to several time think sheet, longer-term you of adopt to balance our can a in we medium in quarters we're technology our significant how build especially we can investments about

would that and first be important So I'd highlight. one the

Second highlight on one acquisitions. is I'd

it. touched you think I on

opportunities We interest in see that. coming more think I have continue we'll M&A to to seen us,

have, market. For us, the is P&C which though, that strategy guided very focused on are we by it's much the we

our to of very efforts around guess financial as and third discipline say, plans, to lever also the buybacks opportunities, will And Are we comments Obviously, of And impacts value broadly well. accretive be we side those at exist. No see other January, believe and incremental look float, we we focused well. It that and that mentioned some summer. did financial stay we'll public in acquisitions, we continue cash I'd we do driving could looking the in have would at, say P&C, mindful on think together look validating areas. we've year. more As the so Mike, much on But to they make at building area in more were flow, we're on side? sense criteria progress last look are the with through they our the we're a point as immediate on and et obviously, balancing buybacks can it strategy as like we'll how update is that continue we'll our we'll was long-term about cetera. very much categories prior shareholder we I how even as at but at we expect certainly, another our focused things

progress about through this how think medium think you'll horizon. time about more see year, talking allocation over capital As I we us we'll and the investment

Operator

Next of question line the Oppenheimer. comes from Kelly with Jed

Jed Kelly

year. great And awesome job,

expect to to I for question a last know, Just the then and of the kind cadence that Joseph, Jayme to, question, Or kind half do kind guess, it? back was kind of, the low rate maybe as was implies the balance about continue to it in -- grow? year-over-year of on you going I just, growth following you of to and think way question. think is of market right normal kind Mike's talking seasonal of the year back up high, of this maybe double the digit. that about I strategically if kind get to Is like And don't

kind volatile less you you cash this as in to As kind over $XXX just we over-earning? where period business maybe now, about think $XXX the million how do the of million exit industry of is making

Joseph Sanborn

Sure.

So the question. -- with so thanks, Jeff, I'll start for

we how which over the do first and about of growth I'll think year. with on So the the start of is start end versus year balance back your one, the

specifics. too I'm get into not so going And to

year. not for for the giving are QX We and guidance

cetera. of giving now, us, carriers a recovery, wildcard say California environment we level be and back continue to sort for target et to in faster, I big not guess how so feel and the growth there's think And out some customers, make it's We a puts approach takes ability incremental for I'll we're I of come it's how is, right is, carriers digital there's terms think a can high and come being the given we will of come we they as right? The -- slower. on think in favorable the at reason carriers a channels could states mode will feel specifics healthy -- industry. some come moves, preferred

the that give things is, we quarters are in our that of try where you is long-term you are QX, of up those year, some some said sort year, we growth was have expect. Mike for I'd much rest QX it would the it to normally, we you are Maybe practice. average. on half It So The play would stronger, the some you out, guidance like as are comps actually will into down. rate the quarters the is actually XXXX seasonally also comps from how quarters think factor back normalizes higher, what lower, are to about of be towards consider out the of on was high. as the balance point we

that in comp mathematically result year-on-year So lower there. a may

I specificity more year. So those would about, given we're I full think than things you are the give for the not that, giving but guidance can't

Jayme Mendal

to industry. is of we've XXXX. Jed, yes, a of I is question historic stability, gone like about, XXXX I there's to which element through -- your an period literally And mean, Yes. aspect of the guess, volatility for there's this I think this, an sort

a think If business sort things look back would of the quite to stable, we and you that, expect before was normalize. bit I more

of was that So XXXX not XXXX aberration perpetuity. the I sort to is in think and likely persist

stability of of for we've have ensure said, term. to we there's long the think lessons to the Now I some learned, got to sort need actions thing and build that take being this that we kind

I'd a that couple probably to point end, of to So things.

of have. is some standpoint, continuing grow of of a asking got of products verticals, additional or within customers the be go sort or begin non-auto the some us are see you'll the that more motorcycle with then commercial. going that whether go like build -- P&C tech the broaden going leads business. contemplates to And RVs vertical using in the us to pull to so to concentration customers getting products things, but carriers. in that to we to coming along lead these kind and deeper sort begin mean could of and small first invest indispensable this P&C agency to to And data insurance that just now start our used partner it insurance sell the number can we of axis. And sort to want to services us part auto that agents. different the more The vertical trying portfolio advantage boat to and in of strategy is #X to of P&C in I a where partner the -- products example continue or of we're along is business be right, is we the existing the of beyond gen, kind that primarily A growth the to think of But I goal homeowners you've out sort so in And out of deeper umbrella, providers. vertical. good to enable from to growth our then ancillary We the or that's think become

is, will relationships. vendor deeper volatility stickier, more much be as that's these right? So for it get time to that transactional encounter we're partner. broader But less headed, hopefully, from a We're we we'll next of a composition building think we'll able have just stable the sufficiently think agents. that direction if with we I instability, market the sort suite through for I to come. the time the of of the a around. execute years look have next the more of period we a different business of And strategy We're strategic evolving kind to a of Now offerings

Operator

next comes William Blair. of Schackart question with Ralph line Our from the

Ralph Schackart

the how color just you carrier it both about in partner as AI from side, your the contemplating First, consumer Joseph, well more think And terms question. or AI we just as a side can augmenting approach? Jamie, just quick year, you're how then, provide of maybe in some your you that this clarifying products Gen and the product should on advancements see

on basis script more a for about I percentage level? XXXX and should think you XXXX. that the in fairly I'm the consistent you being a Is or talked assuming EBITDA Q&A, through about that talking Or were current year? near levels -- be

Jayme Mendal

Sure.

with like respect first touched them. couple question sort I products, Ralph, a your So on to of on of

there's sort verticals. contemplate lens, think our it's from non-auto -- further in of beginning consumer I investment to the

AI on a at using the carriers the carriers, our now help focused efforts of As are to we marketplace. efficiently machine look into more right lot learning bid

a solutions shopping more to And through that's offering. bidding business. the amount bid proprietary more us tremendous to grow in related an We is And use broader their a that's of over beginning it's continue about it, of that a also different do Like agents things bidding an agents, traffic have to EverQuote historical their lot we'll effectively. that can bidding there's a but data which we're now bidding are with carriers we to a to area behavior that this agent year. With consumers, aspect has the carriers bit of process the help lot and to actually help of smart bit effectively, for to to turn agents. invest

ancillary we're some those And delivering beginning around to sort leads, product. services products value-add for to so introduce leads, package we're of new them the lead

to so there the vision shop one-stop local growth agent. for And this be is the really

Joseph Sanborn

And then me your context, margins, little with Ralph. regards on let EBITDA a give to question

if done rear you a negative we've to were the look with our back year, this mirror, what say at look -- ago, margins over had year doing you So we go the EBITDA at if call view EBITDA margins. we past you would if if you

of we margin, XX.X%. to little like for So was XX.X% QX a QX from of over on line year, was the adding -- EBITDA average course last XX%, XXXX the we was year, around that X added went

made So we I of a think progress margins. lot EBITDA in

the of implies or take, QX, at XX.X% As we sort our you give so, guide look or this look midpoint. at year, to

EBITDA we'll so this talked prepared the in near we're half remarks, And investment of look to about through And the as keep the plans we year. we hey, of half think current year, we year, second margins about this as saying, the levels of or our at assume year. rest in second forward the

that, advantage -- talked our to plans investment once incremental in through just got we in we about the on context saying, we start give second call our to November And see we're really faster the AI. And further, on now that we the those half longer-term now FCC side, particularly we of building investments FCC, plans so we have -- technology some expected making in on around the 'XX start now. in fall than shifting to in behind our investments initially and us expected, to focus

of add how disciplined twice OpEx as incremental the So that EBITDA with look year, maintaining -- mean doing half think peak it, average at will ever of we -- be obviously, to if we'll the our we'll at levels. investments we what but or and context where we think balancing that And levels. against to we still about during more I the back we be margins last achieved near in the year. get at XX.X% And was for current you pre-downturn ended expect

we'll good So is -- And quarter-to-quarter. Obviously, and to we've levels the it sort I just maintaining there'll progress, for make guidance through this perfect, progress. won't those -- made some be year continue be of say, keeping year. good would the

would you'll fluctuation, seasonality, I have see some expect quarter-to-quarter. you As

Operator

Craig-Hallum. from comes question Jason line next the Kreyer Our of with

Jason Kreyer

TCPA the lot the if that carriers vacated. can with bigger has some grow didn't And you versus been the of captives local that, a wondering rapidly across like year. think your direct as the Just market, bifurcate other especially now of I agent maybe last outlook as

curious if that business. agent year can your you for bigger be this So think a just growth profile

Jayme Mendal

question. it's good Yes, a

sort carriers we as I local last back think you the sooner kind started saw well. of years, But agent-based last restoring turn agents the year carriers the quicker and and to over see have into then So couple and the corner pull of direct reengage exited kind restoring profitability agents encouraging -- and more for of year. growth the as we of support this

been said of a -- like earlier, the convergence. So there's I bit a I think

carriers growth minded, the for business. now I over these of really and exceptions agent-based includes that businesses are last both the generally or few the local and carriers. We've -- the direct agent captive business a think course direct the year, all say of accelerated carriers

got like And so a is respect that to local from year piece, I shots more need to on leads goal really growth. of traffic we've they're this the it we're of used of a year. generate multiple and and to leads drive would be position we driving both growth, healthy to of terms to there expect the entering kind both With more -- again growth I think kind thing this interesting -- It's in not right? generate just on strength, focused primarily agent just

the these services, develop, products. years scale of which of got and agent grow next some to base. of into the we the ship products evolution as be course continue and dimensions expanding to begin will that couple of ancillary we as multiple over you've with And an think I these sort

Jason Kreyer

of sorry, maybe external And a owners just in then if are curious you to as talking acquisition. there perspective, factors a were investing as hear started maybe more about leads follow-up I'm and like as media across from traffic, we've are XXXX just -- traffic kind VMM go if there I'm or you

scales? that the could VMM least tailwind year to a as So modest at be

Jayme Mendal

traffic on positive percentage. landscape, I be specific sort impact I that has direct or would point the at our X it any wouldn't look you As obviously, VMM -- certainly guess a certainly does of it thing negative.

any progressing through quarter. seen with last happen there's given that year, takes we've puts As and

There that a And so side positive. be else other of what on balances. kind can could you described the be something

doing. One on we think I you in about We year, traffic the things quality is when that the build our to about it. clients that who zone traffic. of maintaining second, earlier excuse about thought more year, we see of So in for which in Q&A and probably -- been longer-term broadly is gave the we've X:X see guidance, was, with here agents you in as how we the VMM by and that our And planning driven the think the think a value think where QX the exclusive is margin for premium our is internally relationship rest as XXs quality select X if comment QX we've the XX%. XX%, about investing high part are me, a the

how see So progresses. and things you could counterbalance described -- factors should the as out, year Other that what certainly, a we'll be may benefit.

Operator

Gregory of line from the Raymond comes last James. with question Peters our And

Mitch Rubin

Could could go on give Greg the or excellent color you your other This on is over? for is Mitch XXXX? question Peters. outlook Any cash of today on free Congratulations My parts on Rubin flow. results. behalf you moving headwinds some

Joseph Sanborn

Sure.

versus to quarter-by-quarter, just adjusted strategic in cash flow our and broader where a we've our operating business that from a pay have it in realignment, pretty if flow. our proxy is good -- out receivables talked really we own through on our good XXX% you payables. flow. In do below except we a be you cash our for conversion 'XX, cash you is as exited EBITDA carriers proxy from wildcard fluctuation, operating goes is slightly adjusted collection minor versus expect very own EBITDA 'XX. carriers continue And XXXX, we business. So in from model, when working operating we saw slightly about or look But payables the to 'XX when XXX% to above since health it's good in for The

business. I But the this further described year, as single so still a in maybe become year, of we're terms we as overall progress As we digit, And we that half this not a for you think consideration on of adjustment like meaningful year, it modest X%, out. relatively go through -- high XXXX. broadly, so pretty this think will Last capital back the for becomes doing year, about working they impact were modest. more taxes are as our taxes

get As now. is will talk doing flow, again, into more that EBITDA for we -- to But tax operating 'XX, we'll good about proxy EBITDA very work it and as we're look we continue. further and adjusted a cash on

Mitch Rubin

you rule And FCC follow-up impacting the of delay do my expenses? your how the see is, change

Joseph Sanborn

of Or I'll talking expenses? to traffic -- or are sort you costs? cash talk our about So you on so operating -- maybe are to referring the

Mitch Rubin

Yes, operating the cash expenses.

Joseph Sanborn

Yes.

expense really cash operating not impact. I'd So is say an

remain QX, around If operating were they're million, in look cash unchanged. $XX you QX, $XX million. around expenses

QX, maybe what's at in look up by implied our guidance that zone, you generally If bit. for moving be they'll a

half And our we to such into advantage costs at referenced expect invest in XX% But going up of we of we're bit just the near flowing with that a level. benefits But move we we start As from continue remarks, to new the and levels. things further we and the I do cash areas current you incremental back that be expenses prepared through. longer as I year, how sort expect margin that level, as in XX%, have get a EBITDA the operating I those technology my QX, think in of build disciplined so at maintain of year term. as to to that we

the so of incremental see year. through sure And making much about we'll as means it you we think But But precisely in progress guided the the they'll the the second as again, is margin by trying wildcard will come in we're half. half expenses EBITDA growth second what year, be maintain VMD in adjusted also to how that through. how that for we grow see revenue

Operator

today. for turn to will our concludes now call it for This I remarks. closing management back

Jayme Mendal

last this started year started sharing couple would at to we multiyear for you'll Great. a us business. EverQuote by I I think of that while, this of to life, entering those EverQuote this out And ago. for been I'll the this I which the to bring close punctuated data few top the the last kind with a exited completion And us from transformation that year a hope taking unrecognizable of half really Well, year of be for certainly everyone, who a years the following appreciate headcount share you virtually evening. time and XXXX. have points. We of just with with thanks,

So on cut no as grew billion first revenue of a adjusted $XXX to year-over-year flow doing cross modest as basis EBITDA to And We well. with breaking went year and now cash with expenses -- EBITDA adjusted by from while milestone to an balance debt. million time. result, million great on we for enabled nearly go grew XX-plus headcount even by we last half percent the roughly nearly that, the sheet to net sheet with That $XX positive us year relatively a balance from $X.X income. last we

on providers EverQuote on AI grow in the on customers on the So is by and technology to of profitable of and is a win the industry solutions insurance state age. best It's that's the focused developing company the and the industry help the in far, team business this digital future. strong helping building growth, the leading

So our being this Thanks. chapter, of appreciate we along the ride. for is really next in and beginning the your interest

Operator

Ladies call. and gentlemen, today's this concludes conference

disconnect. now may You

EverQuote (EVER) 24 Feb 252024 Q4 Earnings call transcript