Company provides preliminary Q1 2020 results in-line with or modestly below prior guidance
LendingTree, the nation’s leading online financial services marketplace, provided a business update regarding the impact of COVID-19.
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“I am extremely proud of how our team has responded to the challenges of COVID-19 – working remotely and with our partners to respond to the environment while prioritizing the health, safety, and productivity of our employees and various stakeholders,” said Doug Lebda, Chairman & CEO. “We are fortunate to have entered this difficult period with good momentum, a well-diversified and nimble business, and strong relationships with our partners. We have a proud history of managing through a crisis, and are confident that we will grow our market share, brand and relevance by being a strong partner during this challenging time. While the virus and corresponding socioeconomic impacts are affecting us all, LendingTree is incredibly well-positioned to navigate this environment, support consumers and our partners, and continue to seek opportunities for growth and expansion.”
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Chief Financial Officer, J.D. Moriarty added, “The downstream impacts of social distancing and related economic pullback are affecting our marketplace participants to varying degrees. Of our three reportable segments – Home, Consumer, and Insurance – we expect the Consumer segment to be most impacted as unsecured credit and the flow of capital in certain corners of the market have tightened. Within Consumer, each of credit card, personal loan, and small business is anticipated to see reductions of as much as 60 – 80% in near-term lender demand for our services reflecting those lenders’ uncertainty over the depth of recession. Importantly, we have a very diversified business, and based on current trends, the impact to our Home and Insurance segments are anticipated be much less substantial. The strength of our business model is such that approximately 75% of our cost structure is highly variable and can be reduced to maintain profitability; and so we expect profitability for the remainder of the year. We are going into this period under-levered and well positioned for strategic opportunities. We are happy to report a strong finish to Q1, despite the COVID-related challenges that came about in March. However, in light of recent developments and uncertainty around the depth and length of economic recession, we are suspending our full-year 2020 financial guidance. We’ll endeavor to provide an outlook for the second quarter when we formally release first quarter results in early May, subject to improved visibility.”
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