IAC/InteractiveCorp. ((IAC)) has held its Q4 earnings call. Read on for the main highlights of the call.
Discover the Best Stocks and Maximize Your Portfolio:
- See what stocks are receiving strong buy ratings from top-rated analysts.
- Filter, analyze, and streamline your search for investment opportunities with TipRanks’ Stock Screener.
IAC/InteractiveCorp. recently held its earnings call, revealing a cautiously optimistic outlook amid significant operational improvements in key segments. The company reported positive developments in the turnaround of Angi and Dotdash, although challenges like Angi’s Q1 2025 outlook and high corporate costs remain. Overall, the sentiment leaned towards an optimistic future, with positive changes slightly outweighing the negatives.
Successful Turnaround for Angi and Dotdash
IAC highlighted the successful turnaround of Angi and Dotdash, two of its previously troubled businesses. Over the past two years, Angi’s EBITDA improved significantly from $35 million after a period of decline, while Dotdash experienced a reversal in traffic declines, showcasing growth.
Strong Cash Flow Performance
The company reported a robust increase in cash flow, with nearly $250 million growth year-on-year, bringing the total to almost $300 million. This indicates strong financial health and performance across its businesses.
Dotdash Digital Revenue Growth
Dotdash achieved notable digital revenue growth of 10%, attributed to a 3% increase in core sessions, 3% growth in digital advertising, and 22% growth in performance marketing.
Angi’s Competitive Positioning with Homeowner Choice
Angi enhanced its competitive positioning by implementing consumer choice in line with FCC orders. This improvement led to a better customer experience, with homeowners opting for their chosen pro 60% more frequently when auto-matched.
Challenges in Q1 2025 for Angi
Despite positive trends, Angi faces challenges with its Q1 2025 outlook. Revenue is expected to decline in the low-20s percent year-over-year, influenced by market disruptions following a vacated FCC order.
Underperformance in Care.com’s Consumer Segment
Care.com’s consumer segment struggled due to product deficiencies and challenging comparisons, resulting in a decline in consumer segment revenue last year.
High Corporate Costs in 2025
IAC anticipates much higher corporate costs in 2025, driven by non-recurring expenses such as separation costs, Angi spin costs, and ongoing litigation.
Forward-Looking Guidance
IAC provided forward-looking guidance highlighting a focus on revenue growth and operational improvements. Angi is expected to grow in 2025 with enhanced customer experience and improved unit economics. Dotdash Meredith projects a 10% plus growth in digital revenue for 2025, while Care.com aims to recover from pandemic impacts with a focus on product enhancements. The integration of AI technology, particularly in their D/Cipher platform, is expected to enhance advertising efficiency and revenue, marking a strategic shift towards leveraging technology to boost financial performance.
In conclusion, IAC’s earnings call painted a picture of cautious optimism. While challenges such as Angi’s Q1 2025 outlook and high corporate costs remain, the positive turnaround of key segments like Angi and Dotdash and strong cash flow performance provide a solid foundation for future growth. The company’s strategic focus on leveraging technology and improving product offerings paves the way for enhanced financial outcomes in the coming years.
