IAC Inc. Q2 FY2024 earnings call

• Dotdash Meredith has been focused on delivering for viewers, with strong traffic growth from content investment, distribution diversification, and monetization improvement in programmatic and premium. - Angi is focused on improving customer experience, including homeowner and pro sides, optimizing marketing efficiency, matching and monetization, and targeting higher quality professionals. - Satisfied with MGM and Turo businesses; Turo executed a warrant to increase ownership, and MGM is performing well. - Considering M&A, looking for suitable acquisition opportunities in public and private markets, focusing on manageable risk and not betting the company on new opportunities.

Dotdash Meredith: Digital revenue grew, with programmatic ad rates up substantially and licensing business also doing well. The large language model licensing deal contributed about half of the dollar growth in the digital licensing line in the quarter. Angi: Revenue declined, but through improving marketing efficiency by stripping out lower value revenue streams, improving matching and monetization through technology, and targeting higher quality professionals, it improved revenue quality and margins. Q2 saw benefits from some expense shifts, and Angi expects to continue good profitability.

• Angi expects Q3 revenue decline to be around 15%, higher than Q2 but in line with Q1 and end of last year; guides to north of $30 million of adjusted EBITDA in Q3. - Dotdash Meredith expects digital revenue growth of 15% or more in Q3 and 25% plus EBITDA growth.

• Macro economic uncertainty may impact business. - Risk in entering new categories, as new business拓展需谨慎，不押注公司。 - Market environment changes may affect crystallization of value like Turo IPO.

Q: Ross Sandler of Barclays asked about Dotdash Meredith's acceleration in 3Q and AI licensing deals.

A: Joey Levin said Dotdash Meredith has strong traffic growth from content, distribution, etc., and monetization improvement with programmatic and premium lifting; Christopher Halpin said the Open AI licensing deal contributed about half of the dollar growth in the digital licensing line in the quarter.

Q: Cory Carpenter of JPMorgan asked about Angi's 'inning' and Angi financials.

A: Jeff Kipp said it's the bottom of the fourth inning, focused on getting more jobs done well; Christopher Halpin said Angi's profit upside in Q2 was due to improving efficiency, and Angi expects profitability to continue with Q3 revenue and EBITDA guidance.

Q: Eric Sheridan of Goldman Sachs asked about cash allocation and Turo.

A: Christopher Halpin said considering M&A and crystallizing value to shrink discount, Turo management is waiting for favorable market environment for IPO; Joey Levin said Turo executed a warrant to increase ownership without expending incremental cash.

Q: John Blackledge of TD Cowen asked about macro and Dotdash Meredith margins.

A: Joey Levin said not seeing macro softness significantly; Jeff Kipp said Q2 incremental margins exceeded expectations due to traffic and monetization, and DDM expects strong 3Q digital revenue and EBITDA growth.

Q: Jason Helfstein of Oppenheimer asked about M&A and Turo IPO.

A: Joey Levin said Turo is waiting for favorable market for IPO, and IAC is considering M&A, focusing on suitable acquisition opportunities.

Q: Youssef Squali of Truist asked about new category and data licensing deals.

A: Joey Levin said there are active discussions for more licensing deals, and IAC has entered new categories with manageable risk; Christopher Halpin said DDM's brands and content are valuable for data licensing.

Q: Nick Jones of Citizens JMP asked about DDM programmatic and decipher guarantee.

A: Christopher Halpin said DDM can outperform market on programmatic, and decipher is a differentiated product with good performance and roadmap.

Q: Brent Thill's analyst asked about Google cookies and alternative identifiers.

A: Christopher Halpin said Google's cookie decision is beneficial in the long run for Dotdash Meredith, and DDM is deploying alternative identifiers.

Q: Yugal Arouninan of Citigroup asked about Angi consumer experience and SEO.

A: Christopher Halpin said Angi is focused on improving matching and consumer experience, and SEO is being rebuilt with early positive indicators.

Q: Tom Champion of Piper Sandler asked about DDM engagement and Angi and rate cuts.

A: Joey Levin said DDM has opportunities to drive engagement with AI; Jeff Kipp said a rate cut could be a tailwind for Angi by increasing homeowner demand.