SEC Filing | Angi Inc.

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angi-20240630

Table of Contents

As filed with the Securities and Exchange Commission on August 7, 2024

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period Ended June 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from__________to__________

Commission File No. 001-38220

https://cdn.kscope.io/30d8df2ed283797c46a355fe43ad6772-Angi Paint.gif

Angi Inc.

(Exact name of Registrant as specified in its charter)


Delaware						82-1204801
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

3601 Walnut Street, Denver, CO 80205

(Address of registrant’s principal executive offices)

(303) 963-7200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of exchange on which registered

Class A Common Stock, par value $0.001

ANGI

The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of August 2, 2024, the following shares of the registrant’s common stock were outstanding:


Class A Common Stock			76,650,008
Class B Common Stock			422,019,247
Class C Common Stock			—
Total outstanding Common Stock			498,669,255

TABLE OF CONTENTS


		Page Number
PART I
Item 1.	Consolidated Financial Statements
	Consolidated Balance Sheet	3
	Consolidated Statement of Operations	4
	Consolidated Statement of Comprehensive Operations	5
	Consolidated Statement of Shareholders’ Equity	6
	Consolidated Statement of Cash Flows	8
	Notes to Consolidated Financial Statements
	Note 1—The Company and Summary of Significant Accounting Policies	9
	Note 2—Financial Instruments and Fair Value Measurements	11
	Note 3—Long-term Debt	12
	Note 4—Accumulated Other Comprehensive Income	13
	Note 5—Segment Information	13
	Note 6—Income Taxes	17
	Note 7—Earnings (Loss ) Per Share	19
	Note 8—Financial Statement Details	20
	Note 9—Contingencies	22
	Note 10—Related Party Transactions with IAC	22
	Note 11—Discontinued Operations	23
	Note 12—Subsequent Events	23

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39
Item 4.	Controls and Procedures	40
PART II
Item 1.	Legal Proceedings	41
Item 1A.	Risk Factors	41
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	43
Item 5.	Other Information	43
Item 6.	Exhibits	45
	Signatures	46

Table of Contents

PART I

FINANCIAL INFORMATION

Item 1. Consolidated Financial Statements

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

(Unaudited)


	June 30, 2024		December 31, 2023
	(In thousands, except par value amounts)
ASSETS
Cash and cash equivalents	$	384,895	$	364,044

Accounts receivable, net	66,325		51,100
Other current assets	64,861		72,075

Total current assets	516,081		487,219

Capitalized software, leasehold improvements and equipment, net	89,749		109,527
Goodwill	885,034		886,047
Intangible assets, net	170,582		170,773
Deferred income taxes	147,064		148,183
Other non-current assets, net	43,955		54,466

TOTAL ASSETS	$	1,852,465	$	1,856,215

LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES:

Accounts payable	$	20,943	$	29,467
Deferred revenue	51,295		49,859
Accrued expenses and other current liabilities	188,588		179,329

Total current liabilities	260,826		258,655

Long-term debt, net	496,439		496,047

Deferred income taxes	3,297		2,739
Other long-term liabilities	47,766		54,266




Commitments and contingencies

SHAREHOLDERS’ EQUITY:
Class A common stock, $0.001 par value; authorized 2,000,000 shares; issued 111,015 and 106,848 shares, respectively, and outstanding 78,223 and 82,208, respectively	111		107
Class B convertible common stock, $0.001 par value; authorized 1,500,000 shares; 422,019 shares issued and outstanding	422		422
Class C common stock, $0.001 par value; authorized 1,500,000 shares; no shares issued and outstanding	—		—
Additional paid-in capital	1,463,370		1,447,353
Accumulated deficit	(228,890)		(231,019)
Accumulated other comprehensive income	259		1,187
Treasury stock, 32,792 and 24,640 shares, respectively	(195,467)		(177,283)
Total Angi Inc. shareholders’ equity	1,039,805		1,040,767
Noncontrolling interests	4,332		3,741
Total shareholders’ equity	1,044,137		1,044,508
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,852,465	$	1,856,215

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
	(In thousands, except per share data)
Revenue	$	315,134	$	351,587	$	620,524	$	707,084
Cost of revenue (exclusive of depreciation shown separately below)	14,152		14,708		26,649		31,645
Gross profit	300,982		336,879		593,875		675,439
Operating costs and expenses:
Selling and marketing expense	158,323		208,877		315,374		408,487
General and administrative expense	84,369		93,167		169,890		189,834
Product development expense	24,779		25,549		48,535		50,861
Depreciation	24,324		22,004		48,173		47,194
Amortization of intangibles	—		2,663		—		5,325
Total operating costs and expenses	291,795		352,260		581,972		701,701
Operating income (loss)	9,187		(15,381)		11,903		(26,262)
Interest expense	(5,041)		(5,034)		(10,079)		(10,063)
Other income, net	4,570		5,184		9,054		8,991
Earnings (loss) from continuing operations before income taxes	8,716		(15,231)		10,878		(27,334)
Income tax provision	(4,628)		(360)		(8,107)		(2,244)
Net earnings (loss) from continuing operations	4,088		(15,591)		2,771		(29,578)
Earnings from discontinued operations, net of tax	—		1,112		—		99
Net earnings (loss)	4,088		(14,479)		2,771		(29,479)
Net earnings attributable to noncontrolling interests	(328)		(220)		(642)		(545)
Net earnings (loss) attributable to Angi Inc. shareholders	$	3,760	$	(14,699)	$	2,129	$	(30,024)

Per share information from continuing operations:
Basic earnings (loss) per share	$	0.01	$	(0.03)	$	0.00	$	(0.06)
Diluted earnings (loss) per share	$	0.01	$	(0.03)	$	0.00	$	(0.06)

Per share information attributable to Angi Inc. shareholders:
Basic earnings (loss) per share	$	0.01	$	(0.03)	$	0.00	$	(0.06)
Diluted earnings (loss) per share	$	0.01	$	(0.03)	$	0.00	$	(0.06)

Stock-based compensation expense by function:

Selling and marketing expense	$	1,145	$	1,481	$	2,377	$	2,733
General and administrative expense	5,807		6,406		13,000		15,167
Product development expense	1,720		2,410		2,692		5,109
Total stock-based compensation expense	$	8,672	$	10,297	$	18,069	$	23,009

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE OPERATIONS

(Unaudited)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
	(in thousands)
Net earnings (loss)	$	4,088	$	(14,479)	$	2,771	$	(29,479)
Other comprehensive (loss) income:
Change in foreign currency translation adjustment	(198)		1,916		(979)		2,418
Change in unrealized gains on available-for-sale marketable debt securities	—		(2)		—		—
Total other comprehensive (loss) income	(198)		1,914		(979)		2,418
Comprehensive income (loss)	3,890		(12,565)		1,792		(27,061)
Components of comprehensive income attributable to noncontrolling interests:
Net earnings attributable to noncontrolling interests	(328)		(220)		(642)		(545)
Change in foreign currency translation adjustment attributable to noncontrolling interests	15		(81)		51		(124)
Comprehensive income attributable to noncontrolling interests	(313)		(301)		(591)		(669)
Comprehensive income (loss) attributable to Angi Inc. shareholders	$	3,577	$	(12,866)	$	1,201	$	(27,730)

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY

Three and Six Months Ended June 30, 2024

(Unaudited)



		Class A Common Stock $0.001 Par Value					Class B Convertible Common Stock $0.001 Par Value					Class C Common Stock $0.001 Par Value												Total Angi Inc. Shareholders' Equity

																				Accumulated Other Comprehensive Income								Total Shareholders' Equity
																Additional Paid-in Capital		Accumulated Deficit				Treasury Stock				Noncontrolling Interests
	$			Shares		$			Shares		$			Shares
	(In thousands)
Balance as of March 31, 2024		$	109		108,870		$	422		422,019		$	—		—	$	1,454,684	$	(232,650)	$	442	$	(183,983)	$	1,039,024	$	4,019	$	1,043,043
Net earnings		—			—		—			—		—			—	—		3,760		—		—		3,760		328		4,088
Other comprehensive loss		—			—		—			—		—			—	—		—		(183)		—		(183)		(15)		(198)
Stock-based compensation expense		—			—		—			—		—			—	10,093		—		—		—		10,093		—		10,093
Issuance of common stock pursuant to stock-based awards, net of withholding taxes		2			2,145		—			—		—			—	(1,481)		—		—		—		(1,479)		—		(1,479)

Purchase of treasury stock		—			—		—			—		—			—	—		—		—		(11,484)		(11,484)		—		(11,484)



Other		—					—			—		—			—	74		—		—		—		74		—		74
Balance as of June 30, 2024		$	111		111,015		$	422		422,019		$	—		—	$	1,463,370	$	(228,890)	$	259	$	(195,467)	$	1,039,805	$	4,332	$	1,044,137

Balance as of December 31, 2023		$	107		106,848		$	422		422,019		$	—		—	$	1,447,353	$	(231,019)	$	1,187	$	(177,283)	$	1,040,767	$	3,741	$	1,044,508
Net earnings		—			—		—			—		—			—	—		2,129		—		—		2,129		642		2,771
Other comprehensive loss		—			—		—			—		—			—	—		—		(928)		—		(928)		(51)		(979)
Stock-based compensation expense		—			—		—			—		—			—	21,112		—		—		—		21,112		—		21,112
Issuance of common stock pursuant to stock-based awards, net of withholding taxes		4			4,167		—			—		—			—	(4,747)		—		—		—		(4,743)		—		(4,743)

Purchase of treasury stock		—			—		—			—		—			—	—		—		—		(18,184)		(18,184)		—		(18,184)



Other		—			—		—			—		—			—	(348)		—		—		—		(348)		—		(348)
Balance as of June 30, 2024		$	111		111,015		$	422		422,019		$	—		—	$	1,463,370	$	(228,890)	$	259	$	(195,467)	$	1,039,805	$	4,332	$	1,044,137

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY

Three and Six Months Ended June 30, 2023

(Unaudited)



		Class A Common Stock $0.001 Par Value					Class B Convertible Common Stock $0.001 Par Value					Class C Common Stock $0.001 Par Value												Total Angi Inc. Shareholders' Equity

																				Accumulated Other Comprehensive (Loss) Income								Total Shareholders' Equity
																Additional Paid-in Capital		Accumulated Deficit				Treasury Stock				Noncontrolling Interests
	$			Shares		$			Shares		$			Shares
	(In thousands)
Balance as of March 31, 2023		$	104		104,119		$	422		422,019		$	—		—	$	1,416,748	$	(205,404)	$	(711)	$	(166,184)	$	1,044,975	$	3,362	$	1,048,337
Net (loss) earnings		—			—		—			—		—			—	—		(14,699)		—		—		(14,699)		220		(14,479)
Other comprehensive income		—			—		—			—		—			—	—		—		1,833		—		1,833		81		1,914
Stock-based compensation expense		—			—		—			—		—			—	11,268		—		—		—		11,268		—		11,268
Issuance of common stock pursuant to stock-based awards, net of withholding taxes		1			1,154		—			—		—			—	(1,704)		—		—		—		(1,703)		—		(1,703)

Purchase of treasury stock		—			—		—			—		—			—	—		—		—		(3,397)		(3,397)		—		(3,397)




Other		—			—		—			—		—			—	(32)		—		—		—		(32)		(24)		(56)
Balance as of June 30, 2023		$	105		105,273		$	422		422,019		$	—		—	$	1,426,280	$	(220,103)	$	1,122	$	(169,581)	$	1,038,245	$	3,639	$	1,041,884

Balance as of December 31, 2022		$	103		102,811		$	422		422,019		$	—		—	$	1,405,294	$	(190,079)	$	(1,172)	$	(166,184)	$	1,048,384	$	2,994	$	1,051,378
Net (loss) earnings		—			—		—			—		—			—	—		(30,024)		—		—		(30,024)		545		(29,479)
Other comprehensive income		—			—		—			—		—			—	—		—		2,294		—		2,294		124		2,418
Stock-based compensation expense		—			—		—			—		—			—	25,138		—		—		—		25,138		—		25,138
Issuance of common stock pursuant to stock-based awards, net of withholding taxes		2			2,462		—			—		—			—	(4,115)		—		—		—		(4,113)		—		(4,113)

Purchase of treasury stock		—			—		—			—		—			—	—		—		—		(3,397)		(3,397)		—		(3,397)





Other		—			—		—			—		—			—	(37)		—		—		—		(37)		(24)		(61)
Balance as of June 30, 2023		$	105		105,273		$	422		422,019		$	—		—	$	1,426,280	$	(220,103)	$	1,122	$	(169,581)	$	1,038,245	$	3,639	$	1,041,884

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)


	Six Months Ended June 30,
	2024		2023
	(In thousands)
Cash flows from operating activities attributable to continuing operations:
Net earnings (loss)	$	2,771	$	(29,479)
Less: Earnings from discontinued operations, net of tax	—		99
Net earnings (loss) attributable to continuing operations	2,771		(29,578)
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities attributable to continuing operations:
Depreciation	48,173		47,194
Provision for credit losses	28,883		44,962
Stock-based compensation expense	18,069		23,009
Non-cash lease expense (including impairment of right-of-use assets)	12,083		6,392
Deferred income taxes	1,735		(2,347)
Amortization of intangibles	—		5,325





Other adjustments, net	1,064		(1,577)
Changes in assets and liabilities, net of effects of acquisitions and dispositions:
Accounts receivable	(44,340)		(36,810)
Other assets	20,517		7,204
Accounts payable and other liabilities	2,461		20,236
Operating lease liabilities	(9,492)		(12,282)
Income taxes payable and receivable	1,574		2,262
Deferred revenue	1,490		3,041
Net cash provided by operating activities attributable to continuing operations	84,988		77,031

Cash flows from investing activities attributable to continuing operations:

Capital expenditures	(25,444)		(22,315)
Purchases of marketable debt securities	—		(12,362)
Proceeds from maturities of marketable debt securities	—		12,500

Proceeds from sales of fixed assets	6		11

Net cash used in investing activities attributable to continuing operations	(25,438)		(22,166)

Cash flows from financing activities attributable to continuing operations:




Purchases of treasury stock	(18,201)		(3,397)

Withholding taxes paid on behalf of employees on net settled stock-based awards	(4,743)		(4,124)
Distribution to IAC pursuant to the tax sharing agreement	(198)		—

Other, net	—		(57)
Net cash used in financing activities attributable to continuing operations	(23,142)		(7,578)

Total cash provided by continuing operations	36,408		47,287
Net cash provided by operating activities attributable to discontinued operations	—		748
Net cash provided by investing activities attributable to discontinued operations	—		245

Total cash provided by discontinued operations	—		993
Effect of exchange rate changes on cash and cash equivalents and restricted cash	(207)		543
Net increase in cash and cash equivalents and restricted cash	36,201		48,823
Cash and cash equivalents and restricted cash at beginning of period	364,301		322,136
Cash and cash equivalents and restricted cash at end of period	$	400,502	$	370,959

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

Table of Contents

ANGI INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1—THE COMPANY AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

Angi Inc. connects quality home service professionals with consumers across more than 500 different categories, from repairing and remodeling homes to cleaning and landscaping. Approximately 187,000 transacting service professionals actively sought consumer matches, completed jobs, or advertised work through Angi Inc. platforms during the three months ended June 30, 2024. Additionally, consumers turned to at least one of our businesses to find a service professional for approximately 19 million projects during the twelve months ended June 30, 2024.

The Company has three operating segments: (i) Ads and Leads; (ii) Services; and (iii) International (consisting of businesses in Europe and Canada) and operates under multiple brands including Angi, HomeAdvisor, and Handy.

Ads and Leads provides service professionals the capability to engage with potential customers, including quoting and invoicing services, and provides consumers with tools and resources to help them find local, pre-screened and customer-rated service professionals nationwide for home repair, maintenance and improvement projects. Services consumers can request household services directly through the Angi platform, and Angi fulfills the request through the use of independently established home services providers engaged in a trade, occupation and/or business that customarily provides such services. The matching, pre-priced booking services, and related tools and directories are provided to consumers free of charge.

As used herein, “Angi,” the “Company,” “we,” “our,” “us,” and similar terms refer to Angi Inc. and its subsidiaries (unless the context requires otherwise).

At June 30, 2024, IAC Inc. (“IAC”) owned 84.9% and 98.2% of the economic and voting interests, respectively, of the Company.

Total Home Roofing, LLC Sale

On November 1, 2023, Angi Inc. completed the sale of 100% of its wholly-owned subsidiary, Total Home Roofing, LLC (“THR,” which comprised its Roofing segment), and has reflected it as a discontinued operation in its financial statements. See “Note 11—Discontinued Operations” for additional details. The financial information for prior periods has been recast to conform to this presentation.

Basis of Presentation and Consolidation

The Company prepares its consolidated financial statements (referred to herein as “financial statements”) in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”). The financial statements include the accounts of the Company, all entities that are wholly-owned by the Company and all entities in which the Company has a controlling financial interest. All intercompany transactions and balances between and among the Company and its subsidiaries have been eliminated.

The unaudited interim financial statements have been prepared in accordance with GAAP for interim financial information and with the rules and regulations of the Securities and Exchange Commission ("SEC"). Accordingly, they do not include all of the information and notes required by GAAP for complete annual financial statements. In the opinion of management, the unaudited interim financial statements include all normal recurring adjustments considered necessary for a fair presentation. Interim results are not necessarily indicative of the results that may be expected for the full year. The unaudited interim financial statements should be read in conjunction with the annual audited financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023.

Accounting Estimates

Management of the Company is required to make certain estimates, judgments, and assumptions during the preparation of its financial statements in accordance with GAAP. These estimates, judgments, and assumptions impact the reported amounts of assets, liabilities, revenue, and expenses and the related disclosure of assets and liabilities. Actual results could differ from these estimates.

Table of Contents

ANGI INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

On an ongoing basis, the Company evaluates its estimates and judgments, including those related to: the fair values of cash equivalents; the carrying value of accounts receivable, including the determination of the allowance for credit losses; the determination of the customer relationship period for certain costs to obtain a contract with a customer; the recoverability of all long-lived assets, including goodwill and indefinite-lived intangible assets; contingencies; unrecognized tax benefits; the liability for potential refunds and customer credits; the valuation allowance for deferred income tax assets; and the fair value of and forfeiture rates for stock-based awards, among others. The Company bases its estimates and judgments on historical experience, its forecasts and budgets, and other factors that the Company considers relevant.

General Revenue Recognition

The Company accounts for a contract with a customer when it has approval and commitment from all authorized parties, the rights of the parties and payment terms are identified, the contract has commercial substance and collectability of consideration is probable. Revenue is recognized when control of the promised services or goods is transferred to the Company’s customers and in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services or goods.

The Company’s disaggregated revenue disclosures are presented in “Note 5—Segment Information.”

Deferred Revenue

Deferred revenue consists of payments that are received or are contractually due in advance of the Company’s performance obligation. The Company’s deferred revenue is reported on a contract-by-contract basis at the end of each reporting period. The Company classifies deferred revenue as current when the remaining term or expected completion of its performance obligation is one year or less. At December 31, 2023, the current and non-current deferred revenue balances were $49.9 million and $0.1 million, respectively, and during the six months ended June 30, 2024, the Company recognized $39.2 million of revenue that was included in the deferred revenue balance as of December 31, 2023. At December 31, 2022, the current and non-current deferred revenue balances were $50.1 million and $0.1 million, respectively, and during the six months ended June 30, 2023, the Company recognized $40.1 million of revenue that was included in the deferred revenue balance as of December 31, 2022.

The current and non-current deferred revenue balances at June 30, 2024 are $51.3 million and less than $0.1 million, respectively. Non-current deferred revenue is included in “Other long-term liabilities” in the balance sheet.

Practical Expedients and Exemptions

For contracts that have an original duration of one year or less, the Company uses the practical expedient available under Accounting Standards Codification (“ASC”) Topic 606 (“ASC 606”), Revenue from Contracts with Customers, applicable to such contracts and does not consider the time value of money.

In addition, as permitted under the practical expedient available under ASC 606, the Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, (ii) contracts with variable consideration that is allocated entirely to unsatisfied performance obligations or to a wholly unsatisfied promise accounted for under the series guidance, and (iii) contracts for which the Company recognizes revenue at the amount which it has the right to invoice for services performed.

The Company also applies the practical expedient to expense sales commissions as incurred where the anticipated customer relationship period is one year or less.

Recent Accounting Pronouncements

Recent Accounting Pronouncements Adopted by the Company

There were no recently issued accounting pronouncements adopted by the Company during the six months ended June 30, 2024.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Recent Accounting Pronouncements Not Yet Adopted by the Company

Accounting Standards Update (“ASU”) 2023-07— Segment Reporting (Topic 280)— Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU No. 2023-07, which is intended to provide users of financial statements with more decision-useful information about reportable segments of a public business entity, primarily through enhanced disclosures of significant segment expenses. This ASU requires annual and interim disclosures of significant expenses that are regularly provided to the chief operating decision maker ("CODM") and included within each reported measure of segment profit or loss and an amount and description of its composition of other segment items. The provisions of this ASU also require entities to include all annual disclosures required by Topic 280 in the interim periods and permits entities to include multiple measures of a segment's profit or loss if such measures are used by the CODM to assess segment performance and determine allocation of resources, provided that at least one of those measures is determined in a way that is consistent with the measurement principles under GAAP. The amendments in ASU 2023-07 apply retrospectively and are effective for fiscal years beginning after December 15, 2023 and interim periods after December 15, 2024. Early adoption is permitted. The Company does not plan to early adopt and is currently assessing the impact of adopting the updated guidance on the financial statements.

ASU 2023-09— Income Taxes (Topic 740)— Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU No. 2023-09, which establishes required categories and a quantitative threshold to the annual tabular rate reconciliation disclosure and disaggregated jurisdictional disclosures of income taxes paid. The guidance’s annual requirements are effective for the Company beginning with the December 31, 2025 reporting period. Early adoption is permitted and prospective disclosure should be applied. However, retrospective disclosure is permitted. The Company is currently assessing the pronouncement and its impact on its income tax disclosures, but it does not impact the Company’s results of operations, financial condition, or cash flows.

NOTE 2—FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The Company categorizes its financial instruments measured at fair value into a fair value hierarchy that prioritizes the inputs used in pricing the asset or liability. The three levels of the fair value hierarchy are:

•Level 1: Observable inputs obtained from independent sources, such as quoted market prices for identical assets and liabilities in active markets.

•Level 2: Other inputs, which are observable directly or indirectly, such as quoted market prices for similar assets or liabilities in active markets, quoted market prices for identical or similar assets or liabilities in markets that are not active and inputs that are derived principally from or corroborated by observable market data. The fair values of the Company’s Level 2 financial assets are primarily obtained from observable market prices for identical underlying securities that may not be actively traded. Certain of these securities may have different market prices from multiple market data sources, in which case an average market price is used.

•Level 3: Unobservable inputs for which there is little or no market data and require the Company to develop its own assumptions, based on the best information available in the circumstances, about the assumptions market participants would use in pricing the assets or liabilities.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis:


	June 30, 2024
	Level 1		Level 2		Level 3		Total Fair Value Measurements
	(In thousands)
Assets:
Cash equivalents:
Money market funds	$	243,433	$	—	$	—	$	243,433
Treasury discount notes	—		74,486		—		74,486



Total	$	243,433	$	74,486	$	—	$	317,919


	December 31, 2023
	Level 1		Level 2		Level 3		Total Fair Value Measurements
	(In thousands)
Assets:
Cash equivalents:
Money market funds	$	215,891	$	—	$	—	$	215,891
Treasury discount notes	—		74,802		—		74,802



Total	$	215,891	$	74,802	$	—	$	290,693

Assets measured at fair value on a nonrecurring basis

The Company’s non-financial assets, such as goodwill, intangible assets, ROU assets, capitalized software, leasehold improvements and equipment are adjusted to fair value only when an impairment is recognized. Such fair value measurements are based predominantly on Level 3 inputs.

Financial instruments measured at fair value only for disclosure purposes

The total fair value of the outstanding long-term debt, including the current portion, is estimated using observable market prices or indices for similar liabilities, which are Level 2 inputs, and was approximately $429.2 million and $418.1 million at June 30, 2024 and December 31, 2023, respectively.

NOTE 3—LONG-TERM DEBT

Long-term debt consists of:


	June 30, 2024		December 31, 2023
	(In thousands)
3.875% ANGI Group Senior Notes due August 15, 2028 (“ANGI Group Senior Notes”); interest payable each February 15 and August 15	$	500,000	$	500,000



Less: unamortized debt issuance costs	3,561		3,953
Total long-term debt, net	$	496,439	$	496,047

ANGI Group, LLC (“ANGI Group”), a direct wholly-owned subsidiary of Angi Inc., issued the ANGI Group Senior Notes on August 20, 2020. These notes may be redeemed at the redemption prices, plus accrued and unpaid interest thereon, if any, as set forth in the indenture governing the notes.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

The indenture governing the ANGI Group Senior Notes contains a covenant that would limit ANGI Group’s ability to incur liens for borrowed money in the event a default has occurred or ANGI Group’s secured leverage ratio exceeds 3.75 to 1.0, provided that ANGI Group is permitted to incur such liens under certain permitted credit facilities indebtedness notwithstanding the ratio, all as defined in the indenture. At June 30, 2024, there were no limitations pursuant thereto.

NOTE 4—ACCUMULATED OTHER COMPREHENSIVE INCOME

The following tables present the components of accumulated other comprehensive income, which exclusively consists of foreign currency translation adjustment for the three and six months ended June 30, 2024:


	Three Months Ended June 30,
	2024		2023
	Foreign Currency Translation Adjustment			Foreign Currency Translation Adjustment		Unrealized Gains on Available-For-Sale Debt Securities		Accumulated Other Comprehensive (Loss) Income
	(In thousands)
Balance at April 1	$	442		$	(713)	$	2	$	(711)
Other comprehensive (loss) income	(183)			1,835		(2)		1,833
Balance at June 30	$	259		$	1,122	$	—	$	1,122


	Six Months Ended June 30,
	2024		2023
	Foreign Currency Translation Adjustment			Foreign Currency Translation Adjustment		Unrealized Gains on Available-For-Sale Debt Securities		Accumulated Other Comprehensive (Loss) Income
	(In thousands)
Balance at January 1	$	1,187		$	(1,172)	$	—	$	(1,172)
Other comprehensive (loss) income	(928)			2,294		—		2,294
Balance at June 30	$	259		$	1,122	$	—	$	1,122

At June 30, 2024 and 2023 there was no tax benefit or provision on the accumulated other comprehensive income.

NOTE 5—SEGMENT INFORMATION

Our reportable segments currently consist of Ads and Leads, Services, and International. Our CODM regularly reviews certain financial information by operating segment to determine allocation of resources and assess its performance. Segment profitability is determined by and presented on an Adjusted EBITDA basis consistent with the CODM’s view of profitability of its businesses, which excludes certain expenses that are required in accordance with GAAP.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

The following table presents revenue by reportable segment:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
	(In thousands)
Revenue:
Domestic
Ads and Leads	$	257,312	$	292,487	$	506,897	$	585,993
Services	24,595		29,867		45,046		61,926


Total Domestic	281,907		322,354		551,943		647,919
International	33,227		29,233		68,581		59,165
Total	$	315,134	$	351,587	$	620,524	$	707,084

The following table presents the revenue of the Company’s segments disaggregated by type of service:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
	(In thousands)
Domestic:
Ads and Leads:
Consumer connection revenue	$	167,624	$	209,013	$	328,155	$	421,948
Advertising revenue	78,309		70,047		155,446		137,228
Membership subscription revenue	11,261		13,231		23,039		26,430
Other revenue	118		196		257		387
Total Ads and Leads revenue	257,312		292,487		506,897		585,993
Services revenue	24,595		29,867		45,046		61,926


Total Domestic	281,907		322,354		551,943		647,919
International:
Consumer connection revenue	27,018		23,371		56,687		48,116
Service professional membership subscription revenue	5,947		5,753		11,329		10,811
Advertising and other revenue	262		109		565		238
Total International	33,227		29,233		68,581		59,165
Total revenue	$	315,134	$	351,587	$	620,524	$	707,084

Revenue by geography is based on where the customer is located. Geographic information about revenue and long-lived assets is presented below:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
	(In thousands)
Revenue:
United States	$	281,818	$	322,354	$	551,690	$	647,919
All other countries	33,316		29,233		68,834		59,165
Total	$	315,134	$	351,587	$	620,524	$	707,084

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)


	June 30, 2024		December 31, 2023
	(In thousands)
Long-lived assets (excluding goodwill and intangible assets):
United States	$	116,051	$	145,710
All other countries	8,218		9,788
Total	$	124,269	$	155,498

The following tables present operating income (loss) and Adjusted EBITDA by reportable segment:


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
	(In thousands)
Operating income (loss):
Ads and Leads	$	24,806	$	4,791	$	44,627	$	18,271
Services	(4,488)		(5,175)		(11,989)		(17,627)

Corporate	(15,191)		(16,568)		(30,308)		(31,507)
International	4,060		1,571		9,573		4,601
Total	$	9,187	$	(15,381)	$	11,903	$	(26,262)


	Three Months Ended June 30,				Six Months Ended June 30,
	2024		2023		2024		2023
	(In thousands)
Adjusted EBITDA(a):
Ads and Leads	$	48,977	$	28,155	$	90,198	$	68,006
Services	1,975		1,700		1,985		(468)

Corporate	(13,904)		(13,109)		(25,825)		(25,463)
International	5,135		2,837		11,787		7,191
Total	$	42,183	$	19,583	$	78,145	$	49,266

(a) The Company’s primary financial measure and GAAP segment measure is Adjusted EBITDA, which is defined as operating income (loss) excluding: (1) stock-based compensation expense; (2) depreciation; and (3) acquisition-related items consisting of amortization of intangible assets and impairments of goodwill and intangible assets, if applicable.

We consider operating income (loss) to be the financial measure calculated and presented in accordance with GAAP that is most directly comparable to our segment reporting performance measure, Adjusted EBITDA. The following tables reconcile operating income (loss) for the Company’s reportable segments and net earnings (loss) attributable to Angi Inc. shareholders to Adjusted EBITDA:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)


	Three Months Ended June 30, 2024
	Operating Income (Loss)		Stock-Based Compensation Expense		Depreciation		Adjusted EBITDA(a)
	(In thousands)
Ads and Leads	$	24,806	$	5,996	$	18,175	$	48,977
Services	(4,488)		1,088		5,375		1,975
Corporate	(15,191)		1,287		—		(13,904)
International	4,060		301		774		5,135
Total	9,187		$	8,672	$	24,324	$	42,183
Interest expense	(5,041)
Other income, net	4,570
Earnings before income taxes	8,716
Income tax provision	(4,628)


Net earnings	4,088
Net earnings attributable to noncontrolling interests	(328)
Net earnings attributable to Angi Inc. shareholders	$	3,760


	Three Months Ended June 30, 2023
	Operating Income (Loss)		Stock-Based Compensation Expense		Depreciation		Amortization of Intangibles		Adjusted EBITDA(a)
	(In thousands)
Ads and Leads	$	4,791	$	5,307	$	15,394	$	2,663	$	28,155
Services	(5,175)		1,192		5,683		—		1,700
Corporate	(16,568)		3,459		—		—		(13,109)
International	1,571		339		927		—		2,837
Total	(15,381)		$	10,297	$	22,004	$	2,663	$	19,583
Interest expense	(5,034)
Other income, net	5,184
Loss from continuing operations before income taxes	(15,231)
Income tax provision	(360)
Net loss from continuing operations	(15,591)