Executive Summary

Q1 2025 revenue rose 43% year over year to $239.7M but fell 8% sequentially; adjusted EPS was $0.99 while GAAP diluted EPS was $(0.92) due to a $15M litigation reserve linked to a preliminary Mantha settlement .
Versus S&P Global consensus, the quarter was mixed: revenue missed ($239.7M vs $244.9M*) while EPS beat ($0.99 vs $0.65*) and EBITDA tracked slightly below S&P’s EBITDA consensus ($24.6M company AEBITDA vs $26.3M* S&P consensus; note S&P’s “EBITDA” may not equal company AEBITDA) .
FY 2025 guidance was lowered (revenue to $955–$995M from $985–$1,025M) with VMM narrowed to $319–$332M and AEBITDA narrowed to $116–$124M; Q2 2025 guidance: revenue $241–$248M, VMM $80–$84M, AEBITDA $29–$31M .
Key stock narrative catalysts: Insurance normalization after FCC “one-to-one consent” reversal, strong small business momentum, and clarity on Mantha/QuoteWizard settlement payment schedule; cash of $126M supports July convertible maturity plans .

What Went Well and What Went Wrong

What Went Well

Broad-based growth: all three segments grew YoY; Insurance +71% YoY revenue, Home +22%, Consumer +9% .
Small business and personal loans strength: small business +48% YoY; personal loans +16% YoY; management expects record SMB revenue in 2025 .
Management discipline and execution: “quarterly AEBITDA grew 14% YoY” and the team is “establishing a culture of efficiency” with careful fixed-cost control and targeted growth investment .
Home equity resilience: Home Equity revenue +24% YoY; favorable structural backdrop from high tappable home equity .

What Went Wrong

GAAP loss driven by litigation reserve: $(12.4)M GAAP net loss and $(0.92) diluted EPS due to $15M reserve increase for Mantha TCPA settlement in principle .
Insurance sequential step-down: Insurance revenue declined 15% Q/Q due to a Q4 budget spike from a carrier and Q1 consumer experience changes for FCC rule; margin compressed (segment profit margin 26% vs 28% in Q4) .
Efficiency metrics compressed: VMM % fell to 32% (from 41% YoY and 33% in Q4); adjusted EBITDA margin slipped to 10% (from 13% YoY and 12% in Q4) as Insurance mix and one-time expenses weighed .

Financial Results

Metric	Q1 2024	Q4 2024	Q1 2025
Revenue ($USD Millions)	$167.8	$261.5	$239.7
GAAP Diluted EPS ($USD)	$0.08	$0.55	$(0.92)
Adjusted Net Income per Share ($USD)	$0.70	$1.16	$0.99
Variable Marketing Margin ($USD Millions)	$69.4	$86.7	$77.7
Variable Marketing Margin %	41%	33%	32%
Adjusted EBITDA ($USD Millions)	$21.6	$32.2	$24.6
Adjusted EBITDA %	13%	12%	10%

Segment breakdown

Segment Metric	Q1 2024	Q4 2024	Q1 2025
Home Revenue ($M)	$30.4	$34.0	$37.0
Home Segment Profit ($M)	$9.6	$11.7	$13.1
Consumer Revenue ($M)	$51.5	$55.6	$56.0
Consumer Segment Profit ($M)	$27.4	$28.2	$27.1
Insurance Revenue ($M)	$85.9	$171.7	$146.7
Insurance Segment Profit ($M)	$33.4	$48.0	$38.7
Total Segment Profit ($M)	$70.5	$87.9	$79.0

KPIs and balance sheet

KPI	Q1 2024	Q4 2024	Q1 2025
Variable Marketing Expense ($M)	$98.3	$174.8	$162.0
Brand Marketing Expense ($M)	$(1.1)	$(1.2)	$(1.3)
Cash and Cash Equivalents ($M)	—	$106.6	$126.4

Estimate comparison (S&P Global)

Metric	Q1 2025 Actual	Q1 2025 Consensus	Surprise
Revenue ($USD)	$239.7M	$244.9M*	Miss ($5.2M)
EPS ($USD)	$0.99	$0.65*	Beat $0.34
EBITDA vs AEBITDA ($USD)	$24.6M AEBITDA	$26.3M* (EBITDA)	Slight miss vs S&P EBITDA; company reports AEBITDA

Values with asterisk retrieved from S&P Global.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenue ($M)	FY 2025	$985–$1,025	$955–$995	Lowered
Variable Marketing Margin ($M)	FY 2025	$319–$336	$319–$332	Narrowed (lower top-end)
Adjusted EBITDA ($M)	FY 2025	$116–$126	$116–$124	Narrowed (lower top-end)
Revenue ($M)	Q2 2025	—	$241–$248	Introduced
Variable Marketing Margin ($M)	Q2 2025	—	$80–$84	Introduced
Adjusted EBITDA ($M)	Q2 2025	—	$29–$31	Introduced
Revenue ($M)	Q1 2025 guide vs actual	$241–$248	Actual: $239.7	Miss vs guide low
VMM ($M)	Q1 2025 guide vs actual	$75–$79	Actual: $77.7	In range
AEBITDA ($M)	Q1 2025 guide vs actual	$25–$27	Actual: $24.6	Slight miss

Note: No explicit guidance provided for tax rate, OpEx line items, or OI&E in the materials reviewed.

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024 and Q4 2024)	Current Period (Q1 2025)	Trend
Insurance regulatory environment (FCC one-to-one consent)	Noted carrier budget surge and margin dynamics in Insurance; regulatory context not primary focus	Headwinds from FCC rule implementation; appeals court struck down rule end of Jan; reverted to prior experience; recovery slower than expected	Improving regulatory backdrop; execution normalization expected
Tariffs/macro sensitivity	Optimism tied to Fed easing aiding Consumer/Home in 2025	Management sees no direct tariff impact; carriers cautious but confident; guidance not baking macro changes	Monitor macro; resilient marketplace model
Small business (concierge sales)	32% YoY Q3 growth; improved unit economics from concierge model	+48% YoY; >50% increase in concierge team; higher conversions, renewal and bonus revenue; record 2025 expected	Accelerating growth; margin-accretive
Home equity demand	Home Equity revenue up; mortgage purchase/refi subdued	Home Equity +24% YoY; strong monetization; “5 handle” mortgage rate could unlock significant refinance demand	Structural tailwind; potential cyclical unlock with rates
Marketing mix and VMM	Q3 margin down as Insurance budgets surged; re-entered high-cost channels	VMM % at 32%; long-term Insurance VMM target low-to-mid 30s as normalization resumes	Margin optimization ongoing
AI/technology visibility	—	Company “appearing well in emerging AI results” and content engagement strong	Positive digital reach
Legal/regulatory (Mantha)	—	Settlement in principle; $19M liability payable in three installments (Q4’25, Q1’26, Q2’26)	De-risking timeline clarified

Management Commentary

“We are happy to report quarterly AEBITDA grew 14% YoY… YoY revenue growth in all three segments exemplifies the durability of the ongoing improvement in our financial performance.” — Doug Lebda, Chairman & CEO .
“Our commitment to operational excellence is steadily delivering numerous wins across the company… helped to broaden growth across all three of our segments.” — Scott Peyree, President & COO .
“We remain focused on carefully managing our fixed costs while strategically investing in discrete growth initiatives… establishing a culture of efficiency as we move forward.” — Jason Bengel, CFO .
“We expected a sharp recovery once we reverted back to our previous customer experience [post FCC ruling], but it has taken longer than anticipated.” — Doug Lebda .
“Low to mid-30s is where we want to be on the [Insurance] VMM side… we’ll be there sooner rather than later.” — Scott Peyree .

Q&A Highlights

Tariffs impact: Carriers are in a stronger profitability position than past 3–5 years; expect cautious behavior but minimal impact to marketing strategies; guidance does not bake macro changes; business model resilient to volatility .
Small business trajectory: Concierge model scaling, unit economics attractive; optimism to maintain strong levels and deliver record revenue in 2025; very profitable vertical .
Mortgage sensitivity: A “5 handle” on 30-year mortgage rates would catalyze a “seismic shift” in demand; Home equity remains the substitution product in current environment .
Insurance VMM normalization: Target long-term VMM in low-to-mid 30s; Q1 step-back from one-time issues; expect continued margin improvement .
Cost levers and ZBB: Detailed understanding of cost base from zero-based budgeting enables rapid expense response if macro deteriorates; variable comp and marketing spend provide natural buffers .
Litigation: Mantha (QuoteWizard) settlement in principle; $19M liability payable in three installments after July convert maturity .
Student loans: Product effectively exited due to low demand; not material revenue impact .

Estimates Context

EPS beat: Adjusted EPS $0.99 vs S&P Primary EPS consensus $0.65*; likely upward estimate revisions for EPS if Insurance and SMB momentum persists .
Revenue miss: $239.7M vs consensus $244.9M*; Insurance sequential step-down and FCC-driven disruption explain shortfall; Q2 guidance indicates stabilization .
EBITDA vs AEBITDA: Company reports Adjusted EBITDA ($24.6M) while S&P tracks EBITDA consensus ($26.3M*); investors should reconcile framework differences when comparing .

Values marked with asterisk retrieved from S&P Global.

Key Takeaways for Investors

Mix-led beat/miss: Strong EPS beat despite revenue miss underscores operating discipline and SMB/Home Equity monetization; monitor Insurance normalization path in Q2/Q3 .
Guidance reset: FY revenue range lowered; near-term guide implies sequential stabilization; watch Insurance budgets and VMM % trend back toward low-to-mid 30s target .
SMB is a margin lever: Concierge-driven SMB growth is accelerating and accretive; expect ongoing support for consolidated margin dollars .
Litigation overhang de-risking: Settlement schedule clarifies cash timing post-July convert; cash $126M and Apollo facility draw position the company to meet obligations .
Housing optionality: Home Equity strength continues; a move to a “5 handle” mortgage rate could unlock purchase/refi upside longer-term .
Execution watchpoints: Track Insurance margin optimization, marketing mix, and expense control under ZBB; monitor consumer demand stability and lender underwriting .
Near-term trading: Narrative sensitivity to Q2 Insurance budgets and margin trajectory, plus any court approvals on Mantha; beats on VMM/AEBITDA vs guide could be positive catalysts .

LendingTree, Inc. (TREE)·Q1 2025 Earnings Summary