MoneyLion Inc.

Greetings and welcome to the MoneyLions Q2 2024 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Sean Horgan, Head of Investor Relations. Thank you. You may begin.

Thank you, Operator. Good morning. Good morning. And thank you all for joining us for our second quarter 2024 earnings conference call. With me today, our Moneyline CEO, Dee Chaube, and CFO, Rick Correa, to discuss our results. You can find the presentation accompanying our earnings press release on our investor relations website at investors.moneyline.com. Please note that any forward-looking statements made in this commentary are subject to our safe harbor statement, which can be found in our SEC filings and our earnings press release. With that, I'll turn the call over to Dave.

Thank you, Sean. Good morning, and thank you all for joining us for our second quarter 2024 earnings call. Moneyline delivered another strong quarter in Q2, achieving record revenue of $131 million and adjusted EBITDA of $18.5 million. This performance is the result of focused execution against the growth pillars we laid out at the beginning of the year, coupled with our offense with discipline approach. Together, this guides our strategic and tactical decision making as we march toward our ambitious goal of becoming the number one destination for financial decisions. Now, turning to the key takeaways for the second quarter of 2024. First, we achieved record quarterly revenue of $131 million. This represents 23% year-over-year growth. Importantly, Our enterprise revenue has reached an inflection point, increasing 17% compared to the first quarter of 2024. In addition, our second quarter revenue exceeded the high end of our guidance of $125 to $130 million. Second, we generated adjusted EBITDA of $18.5 million for the quarter. This reflects an adjusted EBITDA margin of 14.2%, representing 550 basis points of margin expansion year over year. Relative to our guidance, our second quarter adjusted EBITDA was exactly in the middle of our range of $17 to $20 million. Third, in the second quarter, we generated GAAP net income of $3.1 million and diluted earnings per share of 26 cents. And for the first half of 2024, we generated net income of $10.2 million and diluted EPS of 85 cents. If you look at how we've been building the business, there is a clear arc to our evolution. Our technology is expanding on the foundational work we've done over the last 10 years. We have the right pieces in place to deliver an even greater impact. From a strategic perspective, we are in pole position to be the number one destination for Americans to make their best financial decisions. Moneyline is the first digital ecosystem for consumer finance, and we have all of the elements typical of a successful ecosystem. These elements are commerce, business services, content, and developer kits. As we all know, digital ecosystems have disrupted many consumer industries. For example, leading companies like Amazon, Apple, and Expedia all share some level of strength across these dimensions. Those ecosystems disrupted and dominated their industries. However, consumer finance has lacked a true digital ecosystem until now. We have spent the last decade building for this. We are the first digital ecosystem for consumer finance. Despite the presence of many that offer other parts of the equation, no single entity has successfully implemented a complete ecosystem strategy. This is what we're playing for. Moneyline is already in the market, with products and services across commerce, business services, content, and developer kits, with more in development and Moneyline Labs, which I will discuss more in a moment. And the success of this approach is already reflected in our numbers. For one, total customer growth is an outcome of this strategy. We ended the second quarter with 17 million total customers, up 73% year over year. This also represents 1.6 million new customers compared to the prior quarter. Similarly, we've seen robust product consumption across first-party and third-party marketplace products. By the end of Q2 2024, 27.7 million total products were consumed on our platform. Importantly, 51% of the products consumed live to date were third-party, up from 39% through the second quarter of 2023. Of the 2.4 million products consumed in the second quarter alone, 1.7 million were third-party products. This highlights Moneyline's positioning going forward, providing the best marketplace for first- and third-party products across consumer finance verticals. Growth in Moneyline's leading financial marketplace continues to be a key pillar of our ecosystem's strength. As I mentioned before, our enterprise business has reached an inflection point. enterprise revenue grew 17% quarter over quarter in Q2 2024. This bolsters our positioning to further diversify revenue across multiple financial verticals. And importantly, our consumer marketplace, which is part of our enterprise revenue, has been and will continue to be a strong area of growth for us. There are multiple ways for consumers to engage with Moneyline's ecosystem. The direct-to-consumer product is showing great scale in helping consumers learn, search, and get introduced to money topics. As we've said, this is part of our strategy of building the best commerce solution for financial products. Consumers then can access our financial marketplace in a data-driven way, personalized exactly for their financial situation. Or they can take any of our first-party features on an a la carte basis. Users can further reduce fees by accessing the best-in-class financial operating system with a never-overpay promise through our WOW membership, as well as other programs. As you can see, aligned with our mission, our nimble technology stack and global team of engineers, data scientists, and the industry's leading product builders and innovators allow us to deliver consumer PFM and liquidity products across multiple delivery methods. Innovation is in our DNA and we'll continue to build new products and adapt existing products as necessary. All this culminates into continued growth even as we scale. In the second quarter, consumer revenue increased 33% year over year. As we just mentioned, we continue to believe we have the most full-featured and innovative PFM in the industry. Importantly, this world-class PFM technology is available via our mobile app, and online at Moneyline.com. Having this caliber of a PFM tool is the difference between a transaction and a relationship. This is a critical problem that plagues other marketplaces. As we'll talk about later, the benefits show up in our cohort data. Aligned with our mission, no PFM provides this much value around financial literacy, content, and access to the best financial products from our marketplace as Moneyline does. As we continue enhancing our best-in-class PFM, we're pleased that we've extended our agreement with our partner bank, Pathword, for another three years to 2029. We've already had a successful five-year partnership with Pathword, delivering the powerful combination of Moneyline's innovative tech-forward capabilities with the expertise of Pathword's OCC-chartered banking infrastructure to millions of American consumers. In addition to extending our flagship Roar Money digital bank account product, in the future, we will be adding overdraft protection capabilities to our program with Pathword, and we'll be looking to provide overdraft features to help meet the liquidity needs of our customers. This is yet another example of our team quickly bringing new features to our sizable user base in innovative ways, as we've done that for the past 10 years. The PFM capabilities enhance benefits in our network by providing an important companion in the financial product buying experience. And it plays an important role in optimizing conversions in our enterprise network as well. I'll now provide a quick update on our enterprise business. Our network of over 1,200 enterprise partners continues to grow. with over 85 million total customer inquiries in the second quarter alone. With respect to the macroeconomic environment, on our last earnings call in May, we noted that we were seeing stabilization in the underwriting environment, particularly as it relates to personal loans as rates began to normalize. In the second quarter, we continued to see an overall stabilization and improvement in our personal loans vertical. Consumer interest in lending products remained strong, and we consistently added new partners across the credit spectrum and other substitution products to our platform to meet this demand. Additionally, consumer inquiries for non-lending products continue to grow, and we have expanded our marketplace coverage to provide consumers with more access to new verticals like credit cards, auto insurance, and mortgages. This contributed to our second best revenue quarter for our enterprise business. So far in the third quarter, we're seeing a continuation of this trend with further growth and continued stabilization in the underwriting environment. The diversity of our partnership base is a key lever in managing macroeconomic conditions and partner-driven idiosyncratic fluctuations. As you'll see in our Q3 and full year guidance, platform and partner diversity drives multiple ways to win and grow. The strength of the Moneyline team is in managing these levers dynamically. We added even more senior heft this quarter with the hiring of John Kaplan, who was previously CRO of Pinterest, and prior to that, a VP of national sales and managing director of the financial services vertical at Google. Turning to specific enterprise product updates, we continue to release new products that will reduce friction between consumers and relevant product solutions. These include new methods of distributing our marketplace technology, more credit based filters to enhance user approval rates, the launch of our new hosted decision engine capabilities, and intelligent personalized remarketing. In making these updates, we're building towards a connected end to end checkout experience, which we will touch on in a moment. In short, we continue to make progress on our strategic initiatives within our enterprise business and the underwriting environment is showing signs of relative improvement. Now I'd like to turn to something we're excited to share with you all today. The first unveiling of what's been in our DNA since our founding, but now crystallized as Moneyline Labs. We've always had R&D projects that later became scaled revenue drivers. But with Labs, we can now give investors more visibility into how this team will continue innovating and reimagining the future of consumer finance. As I mentioned earlier, we believe the four key elements of a digital ecosystem are commerce, business services, content, and developer kits. We are executing this approach while building on our core businesses as we look to drive towards a more scaled revenue base in 2025 and beyond. First, starting with commerce, our new financial product search technology, Moneyline AI, brings together our unique assets, allowing users to talk to their money, receive unique GenAI-driven insights, and receive personalized offers. Our ambition is for Moneyline AI to become the new form factor through which users engage with their financial decisions. Importantly, we offer Moneyline AI as an embeddable search bar for our enterprise partners so that it can live on their mobile and web properties as well. Second, as it relates to business services, our end-to-end Moneyline checkout experience will give businesses the ability to offer a more seamless customer experience that reduces friction and drives higher conversions. For the first time, a customer will be able to search for, find, and take out a third-party financial product all in one place. Currently, financial product buying journeys are like the DMV being passed on from one desk to another. We intend to fix that. Checkout will empower financial services providers to reach consumers precisely with their exact criteria using credit, risk, cash flow, product history, or other behavioral data. In addition to Moneyline Checkout, our business services capabilities include storefronts for third-party products, data analytics and reporting, programmatic compliance, and much more. The third element is content. A great example of how we're bringing this strategy to life is our content as a service solution. This builds on the investments we've made in this space. Our content capabilities also include content related to personalized products and offers, commenting, community, and other social features, a robust library of financial literacy content, and a lot more. And finally, the fourth relevant element is developer kits. Moneyline is bringing this to life through web services, which includes things like Audience Builder, which allows enterprise partners to unlock the full potential of their marketing strategies with targeted engagement and Next Best Action, which improves the ability to engage with customers by providing personalized recommendations that are both timely and relevant. Separately, Moneyline offers developer kits, predefined compliance APIs, and embeddable widgets and calculators. Through Moneyline Labs, you'll see that in addition to our financial performance, where we're consistently executing, we are setting a bold vision for the future and our role as the first digital ecosystem for consumer finance. Offense with discipline is possible because of the technology and data advantages that we have. And with that, Now we'll turn the call over to Rick to provide a more detailed customer acquisition, unit economics, and financial update.