Daniel Pfeiffer

Danny Pfeiffer, on for Cory Carpenter, asked about the current penetration of Google AI overviews in search results affecting their content. He also requested further color on the pause in share repurchases during the second quarter.

Answer

People Inc. CEO Neil Vogel estimated Google AI overviews now appear on over 50% of relevant searches but emphasized the business is managed as if Google search traffic could go to zero, driving diversification. IAC CFO & COO Christopher Halpin noted the impact is manageable as Google search is only 28% of traffic. Regarding buybacks, Halpin reiterated the focus is on M&A, though the company continues to see value in its stock and actively contemplates both capital deployment options.

Daniel Pfeiffer from JPMorgan asked for the drivers behind the guided 10% Q2 growth in the DTC channel and questioned the confidence in raising the full-year gross margin guidance this early, including the assumptions made about tariffs.

Answer

CFO Jessica Ross stated the Q2 DTC growth is driven by continued momentum from the successful discounting strategy. Regarding margins, Ross explained they are flowing through Q1's strong performance while building in second-half caution for tariffs, implying mid-to-high inflation later in the year. CEO Bill Cobb added they also factored in ~$15 million for normalized weather, yet still raised the margin outlook by 200 basis points.

Daniel Pfeiffer inquired about which category Frontdoor might expand into next within its on-demand business and asked about the marketing spend strategy for the remainder of the year given macro headwinds.

Answer

CEO Bill Cobb indicated the partnerships team is actively exploring opportunities where they can effectively deploy their contractor network but did not name a specific category. He stated a desire to increase marketing spend, referencing an incremental $10 million investment to drive demand and 'keep the hammer down' on the brand's momentum rather than pulling back.

Daniel Pfeiffer of JPMorgan Chase & Co. asked about the potential impact of different political administrations on the Health insurance business and whether early-recovering carriers are sustaining their spending growth.

Answer

Executive Steven Yi explained that the company has grown its Health business under both Democratic and Republican administrations, with potential marginal impacts likely balancing out. Regarding carrier spending, Yi noted continued strong momentum and pointed to public statements from partners like Progressive, indicating that current media investment levels are sustainable and within their target acquisition cost thresholds.

Daniel Pfeiffer asked about the reasons for the slowdown in Tetris during the quarter and any planned changes. He also requested a timeline for developing the sweepstakes capabilities and the rationale for building the solution in-house versus buying it.

Answer

CEO Andrew Pascal attributed the Tetris slowdown to its audience normalizing after a viral spike earlier in the year, and he outlined a rich feature roadmap for the game. Regarding sweepstakes, Pascal explained the decision to build was based on favorable economics and leveraging existing capabilities. He anticipates testing the new solution by the end of Q1 of the upcoming year, with a broader rollout in Q2.