EverQuote, Inc. (Nasdaq: EVER), a leading online insurance
marketplace, today announced financial results for the third
quarter ended September 30, 2022.
“In the third quarter, we exceeded guidance expectations across
our three primary financial KPIs; delivering revenue of $103.2
million, variable marketing margin of $31.8 million, and Adjusted
EBITDA of $2.0 million,” said Jayme Mendal, CEO of EverQuote. “Our
team has demonstrated continued agility, quickly adapting our
operations to a changing environment. By maintaining disciplined
expense management, we achieved positive Adjusted EBITDA this
quarter, while still investing in key strategic initiatives.
“We believe that EverQuote will emerge from the auto insurance
carrier downturn as a stronger company and our data suggests that
we gained market share during this period. We continue to make
progress towards our long-term vision to become the largest online
source of insurance policies by combining data, tech, and
knowledgeable advisors to make insurance simpler, more affordable
and personalized and we are well positioned looking ahead to
2023.”
Third Quarter 2022 Financial Highlights:(All
comparisons are relative to the third quarter of 2021):
- Total revenue of $103.2 million, a decrease of 4%.
- Automotive insurance vertical revenue of $88.2 million, a
decrease of 2%.
- Revenue from other insurance verticals, which includes home and
renters, life, and health insurance, decreased 16% to $15.1
million.
- Variable Marketing Margin of $31.8 million, a decrease of
2%.
- GAAP net loss increased to $6.5 million, compared to GAAP net
loss of $5.3 million.
- Adjusted EBITDA was $2.0 million, compared to Adjusted EBITDA
of $2.7 million.
Fourth Quarter and Full-Year 2022
Guidance:EverQuote anticipates Revenue, Variable Marketing
Margin and Adjusted EBITDA to be in the following ranges:
Fourth Quarter 2022:
- Revenue of $87 - $92 million.
- Variable Marketing Margin of $27 - $30 million.
- Adjusted EBITDA of $(1.5) - $1.5 million.
Full Year 2022:
- Revenue of $403 - $408 million, an update from our previous
guidance of $400 - $410 million.
- Variable Marketing Margin of $126 - $129 million, an increase
from our previous guidance of $116 - $122 million.
- Adjusted EBITDA of $4 - $7 million, an increase from our
previous guidance of Adjusted EBITDA of $(7) - $(1) million.
With respect to the Company’s expectations under “Fourth Quarter
and Full Year 2022 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, one-time severance
charges, 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
EverQuote will host a conference call and live webcast to
discuss its third quarter 2022 financial results at 4:30 p.m.
Eastern Time today, November 1, 2022. To access the conference
call, dial Toll Free: (844) 200-6205 for the US, or (929) 526-1599
for international callers, and provide conference ID 494487. The
live webcast and replay will be available on the Investors section
of the Company’s website at https://investors.everquote.com.
Safe Harbor Statement
Any statements in this press release about future expectations,
plans and prospects for EverQuote, Inc. (“EverQuote” or the
“Company”), including statements about future results of operations
or the future financial position of the Company, including
financial targets, business strategy, plans and objectives for
future operations and other statements containing the words
“anticipates,” “believes,” “expects,” “plans,” and similar
expressions, constitute forward-looking statements within the
meaning of The Private Securities Litigation Reform Act of 1995.
Actual results may differ materially from those indicated by such
forward-looking statements as a result of various important
factors, including: (1) the Company’s ability to attract and retain
consumers and insurance providers using the Company’s marketplace;
(2) the Company’s ability to maintain or increase the amount
providers spend per quote request; (3) the impact on the Company
and the insurance industry of the COVID-19 pandemic; (4) the
effectiveness of the Company’s growth strategies and its ability to
effectively manage growth; (5) the Company’s ability to maintain
and build its brand; (6) the Company’s reliance on its third-party
service providers; (7) the Company’s ability to develop new and
enhanced products and services to attract and retain consumers and
insurance providers, and the Company’s ability to successfully
monetize them; (8) the impact of competition in the Company’s
industry and innovation by the Company’s competitors; (9) the
expected recovery of the auto insurance industry; (10) developments
regarding the insurance industry and the transition to online
marketing; (11) the Company’s ability to successfully integrate
PolicyFuel; (12) the Company’s ability to successfully remediate
the material weaknesses identified in the Company’s internal
controls over financial reporting; (13) the possible impacts of
inflation; and (14) other factors discussed in the “Risk Factors”
section of the Company’s most recent Quarterly Report on Form 10-Q,
which is on file with the Securities and Exchange Commission. In
addition, the forward-looking statements included in this press
release represent the Company’s views as of the date of this press
release. The Company anticipates that subsequent events and
developments will cause the Company’s views to change. However,
while the Company may elect to update these forward-looking
statements at some point in the future, the Company specifically
disclaims any obligation to do so. These forward-looking statements
should not be relied upon as representing the Company’s views as of
any date subsequent to the date of this press release.
About EverQuote
EverQuote operates a leading online insurance marketplace,
connecting consumers with insurance providers. The company's
mission is to empower insurance shoppers to better protect life's
most important assets—their family, property, and future. Our
vision is to become the largest online source of insurance policies
by using data and technology to make insurance simpler, more
affordable and personalized, ultimately reducing cost and risk.
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 JohnsonThe Blueshirt Group415-489-2193
EVERQUOTE, INC.STATEMENTS OF OPERATIONS
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
|
(in thousands except per share) |
|
|
(in thousands except per share) |
|
Revenue |
|
$ |
103,223 |
|
|
$ |
107,563 |
|
|
$ |
315,819 |
|
|
$ |
316,448 |
|
Cost and operating expenses(1): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of revenue |
|
|
5,877 |
|
|
|
5,994 |
|
|
|
17,920 |
|
|
|
17,758 |
|
Sales and marketing |
|
|
89,098 |
|
|
|
92,545 |
|
|
|
273,102 |
|
|
|
265,724 |
|
Research and development |
|
|
7,832 |
|
|
|
9,259 |
|
|
|
24,273 |
|
|
|
26,885 |
|
General and administrative |
|
|
7,102 |
|
|
|
6,731 |
|
|
|
21,400 |
|
|
|
18,527 |
|
Acquisition-related |
|
|
(96 |
) |
|
|
819 |
|
|
|
(4,767 |
) |
|
|
1,005 |
|
Total cost and operating expenses |
|
|
109,813 |
|
|
|
115,348 |
|
|
|
331,928 |
|
|
|
329,899 |
|
Loss from operations |
|
|
(6,590 |
) |
|
|
(7,785 |
) |
|
|
(16,109 |
) |
|
|
(13,451 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income |
|
|
113 |
|
|
|
9 |
|
|
|
158 |
|
|
|
33 |
|
Other income (expense), net |
|
|
26 |
|
|
|
(6 |
) |
|
|
29 |
|
|
|
(46 |
) |
Total other income (expense), net |
|
|
139 |
|
|
|
3 |
|
|
|
187 |
|
|
|
(13 |
) |
Loss before income taxes |
|
|
(6,451 |
) |
|
|
(7,782 |
) |
|
|
(15,922 |
) |
|
|
(13,464 |
) |
Benefit from income taxes |
|
|
— |
|
|
|
2,510 |
|
|
|
— |
|
|
|
2,510 |
|
Net loss |
|
$ |
(6,451 |
) |
|
$ |
(5,272 |
) |
|
$ |
(15,922 |
) |
|
$ |
(10,954 |
) |
Net loss per share, basic and diluted |
|
$ |
(0.20 |
) |
|
$ |
(0.18 |
) |
|
$ |
(0.51 |
) |
|
$ |
(0.38 |
) |
Weighted average common shares outstanding, basic and
diluted |
|
|
32,008 |
|
|
|
29,277 |
|
|
|
31,357 |
|
|
|
28,871 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Amounts
include stock-based compensation expense, as follows: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
|
(in thousands) |
|
|
(in thousands) |
|
Cost of revenue |
|
$ |
67 |
|
|
$ |
108 |
|
|
$ |
221 |
|
|
$ |
282 |
|
Sales and marketing |
|
|
2,461 |
|
|
|
3,366 |
|
|
|
8,635 |
|
|
|
9,216 |
|
Research and development |
|
|
2,687 |
|
|
|
2,692 |
|
|
|
7,748 |
|
|
|
7,340 |
|
General and
administrative |
|
|
2,018 |
|
|
|
2,182 |
|
|
|
5,759 |
|
|
|
6,119 |
|
|
|
$ |
7,233 |
|
|
$ |
8,348 |
|
|
$ |
22,363 |
|
|
$ |
22,957 |
|
EVERQUOTE, INC.BALANCE SHEET DATA
|
|
September 30,2022 |
|
|
December 31,2021 |
|
|
|
(in thousands) |
|
Cash and cash equivalents |
|
$ |
36,591 |
|
|
$ |
34,851 |
|
Working capital |
|
|
40,549 |
|
|
|
37,288 |
|
Total assets |
|
|
163,828 |
|
|
|
143,607 |
|
Total liabilities |
|
|
56,586 |
|
|
|
58,482 |
|
Total stockholders'
equity |
|
|
107,242 |
|
|
|
85,125 |
|
EVERQUOTE, INC.STATEMENTS OF CASH FLOWS
|
|
Three Months Ended September 30, |
|
|
Nine Months Ended September 30, |
|
|
|
2022 |
|
|
2021 |
|
|
2022 |
|
|
2021 |
|
|
|
(in thousands) |
|
|
(in thousands) |
|
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(6,451 |
) |
|
$ |
(5,272 |
) |
|
$ |
(15,922 |
) |
|
$ |
(10,954 |
) |
Adjustments to reconcile net
loss to net cash provided by (used in) operating
activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization expense |
|
|
1,410 |
|
|
|
1,298 |
|
|
|
4,326 |
|
|
|
3,608 |
|
Stock-based compensation expense |
|
|
7,233 |
|
|
|
8,348 |
|
|
|
22,363 |
|
|
|
22,957 |
|
Change in fair value of contingent consideration
liabilities |
|
|
(95 |
) |
|
|
425 |
|
|
|
(4,767 |
) |
|
|
136 |
|
Deferred taxes |
|
|
— |
|
|
|
(2,510 |
) |
|
|
— |
|
|
|
(2,510 |
) |
Provision for (recovery of) bad debt |
|
|
35 |
|
|
|
— |
|
|
|
112 |
|
|
|
(50 |
) |
Unrealized foreign currency transaction (gains) losses |
|
|
(18 |
) |
|
|
(8 |
) |
|
|
(34 |
) |
|
|
15 |
|
Changes in operating assets and liabilities, net of effects
from acquisition: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable |
|
|
(3,878 |
) |
|
|
1,365 |
|
|
|
(4,877 |
) |
|
|
1,662 |
|
Prepaid expenses and other current assets |
|
|
(1,046 |
) |
|
|
(849 |
) |
|
|
(1,296 |
) |
|
|
(941 |
) |
Operating lease right-of-use assets |
|
|
664 |
|
|
|
636 |
|
|
|
1,951 |
|
|
|
2,036 |
|
Other assets |
|
|
(3,511 |
) |
|
|
(749 |
) |
|
|
(14,763 |
) |
|
|
(1,089 |
) |
Accounts payable |
|
|
4,207 |
|
|
|
(1,499 |
) |
|
|
7,620 |
|
|
|
(8,622 |
) |
Accrued expenses and other current liabilities |
|
|
(1,207 |
) |
|
|
2,277 |
|
|
|
(3,266 |
) |
|
|
9,815 |
|
Deferred revenue |
|
|
(84 |
) |
|
|
56 |
|
|
|
(206 |
) |
|
|
23 |
|
Operating lease liabilities |
|
|
(779 |
) |
|
|
(731 |
) |
|
|
(2,134 |
) |
|
|
(2,068 |
) |
Other long-term liabilities |
|
|
— |
|
|
|
26 |
|
|
|
— |
|
|
|
30 |
|
Net cash provided by (used in) operating activities |
|
|
(3,520 |
) |
|
|
2,813 |
|
|
|
(10,893 |
) |
|
|
14,048 |
|
Cash flows from
investing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition of property and
equipment, including costs capitalized for development of
internal-use software |
|
|
(1,230 |
) |
|
|
(965 |
) |
|
|
(3,219 |
) |
|
|
(2,275 |
) |
Acquisition of business |
|
|
— |
|
|
|
(15,955 |
) |
|
|
— |
|
|
|
(15,955 |
) |
Net cash used in investing activities |
|
|
(1,230 |
) |
|
|
(16,920 |
) |
|
|
(3,219 |
) |
|
|
(18,230 |
) |
Cash flows from
financing activities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from exercise of
stock options |
|
|
122 |
|
|
|
1,367 |
|
|
|
730 |
|
|
|
3,091 |
|
Proceeds from private
placement of common stock |
|
|
— |
|
|
|
— |
|
|
|
15,000 |
|
|
|
— |
|
Tax withholding payments
related to net share settlement |
|
|
(28 |
) |
|
|
— |
|
|
|
(79 |
) |
|
|
— |
|
Net cash provided by financing activities |
|
|
94 |
|
|
|
1,367 |
|
|
|
15,651 |
|
|
|
3,091 |
|
Effect of exchange rate
changes on cash, cash equivalents and restricted cash |
|
|
(22 |
) |
|
|
(7 |
) |
|
|
(49 |
) |
|
|
(6 |
) |
Net increase
(decrease) in cash, cash equivalents and
restricted cash |
|
|
(4,678 |
) |
|
|
(12,747 |
) |
|
|
1,490 |
|
|
|
(1,097 |
) |
Cash, cash equivalents and
restricted cash at beginning of period |
|
|
41,269 |
|
|
|
54,770 |
|
|
|
35,101 |
|
|
|
43,120 |
|
Cash, cash equivalents and
restricted cash at end of period |
|
$ |
36,591 |
|
|
$ |
42,023 |
|
|
$ |
36,591 |
|
|
$ |
42,023 |
|
EVERQUOTE, INC.FINANCIAL AND OPERATING
METRICS
Revenue by vertical:
|
|
Three Months Ended September 30, |
|
|
Change |
|
|
|
2022 |
|
|
2021 |
|
|
% |
|
|
|
(in thousands) |
|
|
|
|
|
Automotive |
|
$ |
88,150 |
|
|
$ |
89,666 |
|
|
|
-1.7 |
% |
Other |
|
|
15,073 |
|
|
|
17,897 |
|
|
|
-15.8 |
% |
Total Revenue |
|
$ |
103,223 |
|
|
$ |
107,563 |
|
|
|
-4.0 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30, |
|
|
Change |
|
|
|
2022 |
|
|
2021 |
|
|
% |
|
|
|
(in thousands) |
|
|
|
|
|
Automotive |
|
$ |
257,200 |
|
|
$ |
260,505 |
|
|
|
-1.3 |
% |
Other |
|
|
58,619 |
|
|
|
55,943 |
|
|
|
4.8 |
% |
Total Revenue |
|
$ |
315,819 |
|
|
$ |
316,448 |
|
|
|
-0.2 |
% |
Other financial and non-financial metrics:
|
|
Three Months Ended September 30, |
|
|
Change |
|
|
|
2022 |
|
|
2021 |
|
|
% |
|
|
|
(in thousands) |
|
|
|
|
|
Loss from operations |
|
$ |
(6,590 |
) |
|
$ |
(7,785 |
) |
|
|
-15.4 |
% |
Net loss |
|
$ |
(6,451 |
) |
|
$ |
(5,272 |
) |
|
|
22.4 |
% |
Variable Marketing Margin |
|
$ |
31,844 |
|
|
$ |
32,401 |
|
|
|
-1.7 |
% |
Adjusted EBITDA(1) |
|
$ |
1,983 |
|
|
$ |
2,674 |
|
|
|
-25.8 |
% |
|
|
Nine Months Ended September 30, |
|
|
Change |
|
|
|
2022 |
|
|
2021 |
|
|
% |
|
|
|
(in thousands) |
|
|
|
|
|
Loss from operations |
|
$ |
(16,109 |
) |
|
$ |
(13,451 |
) |
|
|
19.8 |
% |
Net loss |
|
$ |
(15,922 |
) |
|
$ |
(10,954 |
) |
|
|
45.4 |
% |
Variable Marketing Margin |
|
$ |
99,199 |
|
|
$ |
96,669 |
|
|
|
2.6 |
% |
Adjusted EBITDA(1) |
|
$ |
5,842 |
|
|
$ |
14,073 |
|
|
|
-58.5 |
% |
(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;
one-time severance charges; 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’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.
EVERQUOTE,
INC.RECONCILIATION OF NON-GAAP MEASURES TO GAAP
|
|
Three Months Ended September 30, |
|
|
|
Nine Months Ended September 30, |
|
|
|
2022 |
|
|
2021 |
|
|
|
2022 |
|
|
2021 |
|
|
|
(in thousands) |
|
|
|
(in thousands) |
|
Net loss |
|
$ |
(6,451 |
) |
|
$ |
(5,272 |
) |
|
|
$ |
(15,922 |
) |
|
$ |
(10,954 |
) |
Stock-based compensation |
|
|
7,233 |
|
|
|
8,348 |
|
|
|
|
22,363 |
|
|
|
22,957 |
|
Depreciation and amortization |
|
|
1,410 |
|
|
|
1,298 |
|
|
|
|
4,326 |
|
|
|
3,608 |
|
Acquisition-related |
|
|
(96 |
) |
|
|
819 |
|
|
|
|
(4,767 |
) |
|
|
1,005 |
|
Interest income |
|
|
(113 |
) |
|
|
(9 |
) |
|
|
|
(158 |
) |
|
|
(33 |
) |
Benefit from income taxes |
|
|
— |
|
|
|
(2,510 |
) |
|
|
|
— |
|
|
|
(2,510 |
) |
Adjusted EBITDA |
|
$ |
1,983 |
|
|
$ |
2,674 |
|
|
|
$ |
5,842 |
|
|
$ |
14,073 |
|
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