EverQuote Announces First Quarter 2023 Financial Results
- First Quarter Revenue of
$109.2 million - First Quarter Variable Marketing Margin Increased to
$35.6 million
“In the first quarter of 2023, we exceeded expectations across our three primary financial KPIs, delivering revenue of
“As we have done throughout the auto insurance industry downturn, we will continue to drive efficiency throughout our operations by judiciously managing expenses, while investing in key strategic areas to position the company for long-term growth. However, the persistence of elevated claims losses for auto insurance carriers, has introduced significant uncertainty with regards to the outlook for industry marketing spend for the balance of this year, and as a result, we are withdrawing our full year guidance.”
First Quarter 2023 Financial Highlights:
(All comparisons are relative to the first quarter of 2022)
- Total revenue of
$109.2 million , a decrease of 1%. - Automotive insurance vertical revenue of
$89.7 million , an increase of 2%. - Revenue from other insurance verticals, which includes home and renters, life, and health insurance, decreased 15% to
$19.5 million . - Direct to consumer agency, or DTCA, revenue of
$9.8 million , or 9% of total revenue. - Variable Marketing Margin of
$35.6 million , an increase of 4%. - GAAP net loss improved to a loss of
$2.5 million , compared to a GAAP net loss of$5.7 million . - Adjusted EBITDA increased to
$5.4 million , compared to Adjusted EBITDA of$2.4 million .
Second Quarter and Full Year 2023 Outlook:
Given the uncertainty of performance within the auto insurance industry and the exact timing of when carriers may restore their marketing budgets, the Company is withdrawing its previously provided full year 2023 guidance.
For the second quarter 2023,
- Revenue of
$70 -$75 million . - Variable Marketing Margin of $23 –
$26 million . - Adjusted EBITDA of ($4) –
($1) million .
With respect to the Company’s expectations under “Second Quarter and Full Year 2023 Guidance” above, the Company has not reconciled the non-GAAP measure Adjusted EBITDA to the GAAP measure net income (loss) in this press release because the Company does not provide guidance for stock-based compensation expense, depreciation and amortization expense, acquisition-related costs, interest income, and income taxes on a consistent basis as the Company is unable to quantify these amounts without unreasonable efforts, which would be required to include a reconciliation of Adjusted EBITDA to GAAP net income (loss). In addition, the Company believes such a reconciliation would imply a degree of precision that could be confusing or misleading to investors.
Conference Call and Webcast Information
Safe Harbor Statement
Any statements in this press release about future expectations, plans and prospects for
About
For more information, visit everquote.com and follow on Twitter @everquotelife, Instagram @everquotepics, and LinkedIn https://www.linkedin.com/company/everquote/.
Investor Relations Contact
Brinlea Johnson
415-489-2193
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||||||||
| Three Months Ended |
||||||||
| 2023 | 2022 | |||||||
| (in thousands except per share) | ||||||||
| Revenue | $ | 109,220 | $ | 110,681 | ||||
| Cost and operating expenses(1): | ||||||||
| Cost of revenue | 5,770 | 5,984 | ||||||
| Sales and marketing | 90,237 | 96,150 | ||||||
| Research and development | 7,927 | 8,196 | ||||||
| General and administrative | 7,830 | 6,941 | ||||||
| Acquisition-related costs | (113 | ) | (892 | ) | ||||
| Total cost and operating expenses | 111,651 | 116,379 | ||||||
| Loss from operations | (2,431 | ) | (5,698 | ) | ||||
| Other income (expense): | ||||||||
| Interest income | 187 | 8 | ||||||
| Other income (expense), net | 1 | (25 | ) | |||||
| Total other income (expense), net | 188 | (17 | ) | |||||
| Loss before income taxes | (2,243 | ) | (5,715 | ) | ||||
| Income tax expense | (286 | ) | — | |||||
| Net loss | $ | (2,529 | ) | $ | (5,715 | ) | ||
| Net loss per share, basic and diluted | $ | (0.08 | ) | $ | (0.19 | ) | ||
| Weighted average common shares outstanding, basic and diluted | 32,892 | 30,529 | ||||||
| (1) Amounts include stock-based compensation expense, as follows: | ||||||||
| Three Months Ended |
||||||||
| 2023 | 2022 | |||||||
| (in thousands) | ||||||||
| Cost of revenue | $ | 54 | $ | 59 | ||||
| Sales and marketing | 2,273 | 3,210 | ||||||
| Research and development | 2,374 | 2,411 | ||||||
| General and administrative | 1,808 | 1,850 | ||||||
| $ | 6,509 | $ | 7,530 | |||||
BALANCE SHEET DATA |
||||||||
| 2023 | 2022 | |||||||
| (in thousands) | ||||||||
| Cash and cash equivalents | $ | 28,753 | $ | 30,835 | ||||
| Working capital | 38,606 | 35,567 | ||||||
| Total assets | 160,437 | 156,519 | ||||||
| Total liabilities | 48,801 | 49,033 | ||||||
| Total stockholders' equity | 111,636 | 107,486 | ||||||
STATEMENTS OF CASH FLOWS |
||||||||
| Three Months Ended |
||||||||
| 2023 | 2022 | |||||||
| (in thousands) | ||||||||
| Cash flows from operating activities: | ||||||||
| Net loss | $ | (2,529 | ) | $ | (5,715 | ) | ||
| Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
| Depreciation and amortization expense | 1,407 | 1,511 | ||||||
| Stock-based compensation expense | 6,509 | 7,530 | ||||||
| Change in fair value of contingent consideration liabilities | (113 | ) | (892 | ) | ||||
| Provision for bad debt | 245 | 75 | ||||||
| Unrealized foreign currency transaction losses | 9 | 7 | ||||||
| Changes in operating assets and liabilities: | ||||||||
| Accounts receivable | (9,827 | ) | (10,973 | ) | ||||
| Prepaid expenses and other current assets | 1,709 | (287 | ) | |||||
| Commissions receivable, current and non-current | 595 | (5,381 | ) | |||||
| Operating lease right-of-use assets | 688 | 645 | ||||||
| Other assets | 36 | (29 | ) | |||||
| Accounts payable | 4 | 13,296 | ||||||
| Accrued expenses and other current liabilities | 852 | (2,857 | ) | |||||
| Deferred revenue | 80 | (112 | ) | |||||
| Operating lease liabilities | (902 | ) | (663 | ) | ||||
| Net cash used in operating activities | (1,237 | ) | (3,845 | ) | ||||
| Cash flows from investing activities: | ||||||||
| Acquisition of property and equipment, including costs capitalized for development of internal-use software | (1,007 | ) | (681 | ) | ||||
| Net cash used in investing activities | (1,007 | ) | (681 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Proceeds from exercise of stock options | 287 | 558 | ||||||
| Proceeds from private placement of common stock | — | 15,000 | ||||||
| Tax withholding payments related to net share settlement | (130 | ) | — | |||||
| Net cash provided by financing activities | 157 | 15,558 | ||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | 5 | (5 | ) | |||||
| Net increase (decrease) in cash, cash equivalentsand restricted cash | (2,082 | ) | 11,027 | |||||
| Cash, cash equivalents and restricted cash at beginning of period | 30,835 | 35,101 | ||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 28,753 | $ | 46,128 | ||||
FINANCIAL AND OPERATING METRICS |
||||||||||||
| Revenue by vertical: | ||||||||||||
| Three Months Ended |
Change | |||||||||||
| 2023 | 2022 | % | ||||||||||
| (in thousands) | ||||||||||||
| Automotive | $ | 89,699 | $ | 87,675 | 2.3 | % | ||||||
| Other | 19,521 | 23,006 | -15.1 | % | ||||||||
| Total Revenue | $ | 109,220 | $ | 110,681 | -1.3 | % | ||||||
| Other financial and non-financial metrics: | ||||||||||||
| Three Months Ended |
Change | |||||||||||
| 2023 | 2022 | % | ||||||||||
| (in thousands) | ||||||||||||
| Loss from operations | $ | (2,431 | ) | $ | (5,698 | ) | -57.3 | % | ||||
| Net loss | $ | (2,529 | ) | $ | (5,715 | ) | -55.7 | % | ||||
| Variable Marketing Margin | $ | 35,593 | $ | 34,264 | 3.9 | % | ||||||
| Adjusted EBITDA(1) | $ | 5,373 | $ | 2,426 | 121.5 | % | ||||||
| (1) Adjusted EBITDA is a non-GAAP measure. Please see “EverQuote, Inc. Reconciliation of Non-GAAP Measures to GAAP” below for more information. | ||||||||||||
To supplement the Company’s financial statements presented in accordance with GAAP and to provide investors with additional information regarding EverQuote’s financial results, the Company has presented Adjusted. EBITDA as a non-GAAP financial measure. This non-GAAP financial measure is not based on any standardized methodology prescribed by GAAP and is not necessarily comparable to similarly titled measures presented by other companies.
The Company defines Adjusted EBITDA as net income (loss), excluding the impact of stock-based compensation expense; depreciation and amortization expense; acquisition-related costs; interest income; and income taxes. The most directly comparable GAAP measure is net income (loss). The Company monitors and presents Adjusted EBITDA because it is a key measure used by management and the board of directors to understand and evaluate operating performance, to establish budgets and to develop operational goals for managing EverQuote’s business. In particular, the Company believes that excluding the impact of these items in calculating Adjusted EBITDA can provide a useful measure for period-to-period comparisons of EverQuote’s core operating performance.
The Company uses Adjusted EBITDA to evaluate EverQuote’s operating performance and trends and make planning decisions. The Company believes that this non-GAAP financial measure helps identify underlying trends in EverQuote’s business that could otherwise be masked by the effect of the items that the Company excludes in the calculations of Adjusted EBITDA. Accordingly, the Company believes that this financial measure provides useful information to investors and others in understanding and evaluating EverQuote’s operating results, enhancing the overall understanding of the Company’s past performance and future prospects.
The Company’s non-GAAP financial measures are not prepared in accordance with GAAP and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of Adjusted EBITDA rather than net income (loss), which is the most directly comparable financial measure calculated and presented in accordance with GAAP. In addition, other companies may use other measures to evaluate their performance, which could reduce the usefulness of the Company’s non-GAAP financial measures as tools for comparison.
The following table reconciles Adjusted EBITDA to net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP.
RECONCILIATION OF NON-GAAP MEASURES TO GAAP |
||||||||
| Three Months Ended |
||||||||
| 2023 | 2022 | |||||||
| (in thousands) | ||||||||
| Net loss | $ | (2,529 | ) | $ | (5,715 | ) | ||
| Stock-based compensation | 6,509 | 7,530 | ||||||
| Depreciation and amortization | 1,407 | 1,511 | ||||||
| Acquisition-related costs | (113 | ) | (892 | ) | ||||
| Interest income | (187 | ) | (8 | ) | ||||
| Income tax expense | 286 | — | ||||||
| Adjusted EBITDA | $ | 5,373 | $ | 2,426 | ||||
Source:
United Fire Group, Inc. Reports First Quarter 2023 Results
NI Holdings, Inc. Reports Results for First Quarter Ended March 31, 2023 – Form 8-K
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