LendingTree, Inc.

Good day and thank you for standing by. Welcome to the LendingTree third quarter 2025 earnings conference call. At this time, all participants are in the 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. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Andrew Wessel, Investor Relations and Corporate Development. Please go ahead.

Andrew Wessel Thank you, Brittany. And hello to everyone joining us on the call to discuss LendingTree's third quarter 2025 financial results. On with us today are Scott Puri, CEO, and Jason Bangle, CFO. This morning, we posted a detailed letter to shareholders on our investor relations website, and for the purposes of today's discussion, we will assume that listeners have read that letter and will focus on Q&A. Before I hand the call over to Scott for his remarks, I remind everyone that during this 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, and I refer you to today's press release and shareholder letter, both available on our website, for the comparable GAAP definitions and full reconciliations of non-GAAP measures to GAAP. And with that, Scott, please go ahead.

Thank you, Andrew. And thanks to everyone for joining us today as we discuss our third quarter results. First off, all of us here at LendingTree are deeply saddened by our founder Doug Love's sudden passing a few weeks ago. Doug was a visionary leader who had an impact on every part of our company. He was truly passionate, creating a marketplace where consumers could find the best financial product for them at the most competitive price. He coined our longstanding and well-known marketing tagline, when banks compete, you win. Personally, I came to know Doug as he explored buying the company I founded, Quote Wizard, back in 2018. At that time, I appreciated his entrepreneurial spirit that we both shared, his deep passion for the business, and the strong and similar culture he had at LendingTree compared to Quo Wizard. After LendingTree ultimately bought my company, I was able to know him more closely, especially in the last two years I served as president and chief operating officer. I viewed him as a great boss, great business partner, and a great friend. I also came to appreciate how much he cared about all of the employees at LendingTree. For example, he insisted that full-time employees receive stock as part of their compensation so they would think like owners. He was present at all kinds of internal company events, Of course, him seeing every quarterly all-hands meeting, but also showing up at small internal meetings or celebrations, always offering encouraging words and pushing all of us to achieve more. The outpouring of condolences we have received since his passing from people across the country and within our industry has been truly overwhelming. All of us at LendingStream mourn him and keep his wife, daughters, parents, and family in our thoughts as we carry on with his legacy. I'm honored to become the second CEO in the company's history and carry the mantle of what Doug founded nearly 30 years ago. Doug and I were aligned on driving continuous improvement in the consumer shopping experience, optimizing our business through operational excellence initiatives, which I started to implement two years ago upon being appointed the COO. We also share the belief that improvements in AI technology will greatly benefit the consumer experience when they come to LendTree shopping for financial products. I'm very excited as to how agentic AI, LLMs, and other AI tools can transform the shopping experience of our products over the next few years. Finally, we both agreed we needed to ensure our balance sheet was equipped not just to survive future periods of economic stress, but to thrive in them, allowing us to go on the offense when competitors are pulling back and our customers need us more than ever. Reflecting on the incredible business Doug created, it seems appropriate that in the third quarter this year, our revenue of $308 million was our second highest in company's history, barely missing our high point when the Fed rates were essentially zero. Each of our three segments recorded double-digit year-over-year revenue and VMD growth. This is the sixth consecutive quarter we have reported revenue growth from the prior period. The company's diversification across industries is allowing us to lean into areas of high demand, most notably from our insurance carrier partners looking for new auto customers. We have retaken a leadership position in the insurance marketplace. We will continue matching carriers with quality high-intent consumers to capture an increasing share of those insurance companies' marketing budgets as we move into next year. This is a similar strategy we employed during the downturn in carrier demand in 23, which led us to being well-positioned with leading market share when the industry recovered and then boomed in 24. Importantly, we've begun to see a strong ramp in spend outside of our top three carriers, an important indicator of the health and duration of this cycle. Specifically in Q3, if you look at our fourth through 10th largest carriers in our network, so take out our top three carriers, those next seven spend with us increased by nearly 60% compared to a year ago. Our consumer segment is also producing fantastic results. Segment VMD grew 26% on the quarter and 11% revenue growth. Our small business team has just been spectacular. and it's benefited from our investment in the concierge sales strategy. These high-touch customer service models helped us drive a 30% increase in the number of loans we closed for partners in this quarter versus last year, and driving overall 50% year-over-year increase in revenue. It has propelled growth in our high-margin bonus and referral revenue streams as well. The personal loans business continues to grow nicely as lenders are steadily and cautiously widening their credit criteria for borrowers. Notably, close rates for both prime and mid-prime loans for debt consolidation grew by double digits in the quarter compared to the prior year. Record consumer credit card balances and a forecast for lower short-term interest rates should help accelerate the growth of this vertical in the next year. The home segment is also doing quite well. Despite persistent high mortgage rates in the sluggish housing market, revenue from our home equity product increased 35% in the third quarter. as lenders continue to target this product given the lack of demand for first mortgages. Existing home sales remain stuck around the 4 million annual unit level. You'd have to look back to the financial crisis period of 08, 09 to find similarly low activity. Before we take your questions, I want to let the investor community know that we are extremely well positioned to grow our business. Doug created a revolutionary company, the first true online comparison shopping site, and I am honored to lead going forward and continue executing on its original vision. I would also like to thank all of the employees at LendingTree for putting up such strong performance and positioning us well for continued growth in 2026. We are happy to open the line to your questions.