LendingTree, Inc.

Good day and thank you for standing by. Welcome to the LendingTree Incorporated third quarter 2022 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one one on your telephone and you will then hear an automated message advising your hand is raised. Please be advised that today's conference is being recorded And I would now like to hand the conference over to your speaker today, Andrew Wessel. Andrew, please go ahead.

Thank you, and good morning to everyone joining us on the call this morning to discuss LendingTree's third quarter 2022 financial results. On the call today are Doug Lubda, LendingTree's chairman and CEO, J.D. Moriarty, president of Marketplace and COO, Trent Ziegler, CFO, and Scott Puri, president of insurance. As a reminder to everyone, we posted a detailed letter to shareholders on our investor relations website earlier today. And for the purposes of today's call, we will assume that listeners have read that letter and will focus on Q&A. Before I hand the call over to Doug for his remarks, I remind everyone that during today's call, we may discuss LendingTree's expectations for future performance. Any forward-looking statements that we make are subject to risks and uncertainties, and LendingTree's actual results could differ materially from the views expressed today. Many but not all of the risks we face are described in our periodic reports filed with the SEC. We will also discuss a variety of non-GAAP measures on the call today, and I refer you to today's press release and shareholder letter, both available on our website, for the comparable GAAP definitions and full reconciliation from non-GAAP measures to GAAP. And with that, Doug, please go ahead.

Thank you, Andrew, and thank you to everybody for joining us on the call today. Our company continues to respond to the multiple headwinds facing us by focusing on what we can control to improve performance and advance our strategy. The most important item we can control are the projects we spend time working on. Our core growth initiatives that will dramatically improve the user experience, remain front and center for all of us. The product of an improved customer experience is greater loyalty, generating organic traffic growth that reduces our reliance on paid search, as well as higher conversion rates and monetization for us and our lending partners. We are working to transform the margin profile of our marketplace by presenting customers with the right offer for a financial product when it is most relevant to them. A key component of that strategy is reinvesting in our brand. We returned to TV advertising this quarter with a celebrity-driven campaign. Initial results are very positive, showing market improvements in several aspects of brand health and aided customer awareness of LendingTree. As previously communicated, we expect to remain on the sidelines during the fourth quarter due to the normal cycle of seasonally more expensive media and weaker customer focus on financial products during the holiday periods. Another area that is within our control is our operating expense. Subsequent to quarter end, we took further action to manage our fixed costs that will result in $25 million of annualized savings beginning next year. We've reduced our headcount by 20% since the peak in mid-2021 through targeted workforce reductions and limiting hiring to critical roles on growth projects. We remain well resourced to continue this critical work for our strategic initiatives and to support our marketplace business. On our last call, I discussed how we are working alongside our partners to help them navigate difficult market conditions. I mentioned our efforts to assist some of our largest mortgage lenders roll out home equity offerings for homeowners that today are enjoying record levels of asset value that they can efficiently borrow against. We are happy to report these efforts help to lead to another record revenue quarter for our home equity offerings. Strengthening our partnerships during the hard times has proven paramount to our success, and we will continue to work on improving these relationships. The consumer segment was again our best performer this quarter, as personal and small business loans grew revenues 12 and 8% over the prior year, respectively. We also added a new personal loan and credit card partner to our TreeQual platform. We expect to make an existing product introduction soon that is a direct result of our strategic initiatives aimed to deepen the relationship with our customers while helping them improve their personal finances. The insurance team provided another example on focusing on what is within their control this quarter. As their business continues to endure the impact of inflationary headwinds, the insurance team's work on improving marketing efficiency generated 4.6 percentage points of margin expansion sequentially from the second quarter, holding VME flat despite a drop in revenues. I'm excited about the opportunity ahead of us. Executing on our strategy will help us reinvigorate revenue and margin growth and lead us into the next successful iteration lending tree. Now, operator, I'd love to open the line for questions.