10-Q 1 angi-20240331.htm 10-Q angi-20240331
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As filed with the Securities and Exchange Commission on May 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 March 31, 2024
Or
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
Angi Paint.gif
Angi Inc.
(Exact name of Registrant as specified in its charter)
Delaware82-1204801
(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)
(303963-7200
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of exchange on which registered
Class A Common Stock, par value $0.001ANGIThe 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 filerAccelerated filerNon-accelerated filerSmaller reporting companyEmerging 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 May 3, 2024, the following shares of the registrant’s common stock were outstanding:
Class A Common Stock79,722,608 
Class B Common Stock422,019,247 
Class C Common Stock— 
Total outstanding Common Stock501,741,855 



TABLE OF CONTENTS
  Page
Number




2

PART I
FINANCIAL INFORMATION
Item 1.    Consolidated Financial Statements
ANGI INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
(Unaudited)
March 31, 2024December 31, 2023
(In thousands, except par value amounts)
ASSETS
Cash and cash equivalents$363,337 $364,044 
Accounts receivable, net60,810 51,100 
Other current assets57,662 72,075 
Total current assets481,809 487,219 
Capitalized software, leasehold improvements and equipment, net 99,893 109,527 
Goodwill885,234 886,047 
Intangible assets, net 170,612 170,773 
Deferred income taxes147,258 148,183 
Other non-current assets, net50,169 54,466 
TOTAL ASSETS$1,834,975 $1,856,215 
LIABILITIES AND SHAREHOLDERS’ EQUITY
LIABILITIES:
Accounts payable$30,534 $29,467 
Deferred revenue50,084 49,859 
Accrued expenses and other current liabilities161,606 179,329 
Total current liabilities242,224 258,655 
Long-term debt, net496,241 496,047 
Deferred income taxes3,034 2,739 
Other long-term liabilities50,433 54,266 
Commitments and contingencies  
SHAREHOLDERS’ EQUITY:
Class A common stock, $0.001 par value; authorized 2,000,000 shares; issued 108,870 and 106,848 shares, respectively, and outstanding 81,402 and 82,208, respectively
109 107 
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 capital1,454,684 1,447,353 
Accumulated deficit(232,650)(231,019)
Accumulated other comprehensive income442 1,187 
Treasury stock, 27,468 and 24,640 shares, respectively
(183,983)(177,283)
Total Angi Inc. shareholders’ equity1,039,024 1,040,767 
Noncontrolling interests4,019 3,741 
Total shareholders’ equity1,043,043 1,044,508 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$1,834,975 $1,856,215 
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
3



ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
Three Months Ended March 31,
20242023
(In thousands, except per share data)
Revenue$305,390 $355,497 
Cost of revenue (exclusive of depreciation shown separately below)12,497 16,937 
Gross Profit292,893 338,560 
Operating costs and expenses:
Selling and marketing expense157,051 199,610 
General and administrative expense85,521 96,667 
Product development expense23,756 25,312 
Depreciation23,849 25,190 
Amortization of intangibles 2,662 
Total operating costs and expenses290,177 349,441 
Operating income (loss)2,716 (10,881)
Interest expense(5,038)(5,029)
Other income, net4,484 3,807 
Earnings (loss) from continuing operations before income taxes2,162 (12,103)
Income tax provision(3,479)(1,884)
Net loss from continuing operations(1,317)(13,987)
Loss from discontinued operations, net of tax (1,013)
Net loss(1,317)(15,000)
Net earnings attributable to noncontrolling interests(314)(325)
Net loss attributable to Angi Inc. shareholders$(1,631)$(15,325)
Per share information from continuing operations:
Basic loss per share$(0.00)$(0.03)
Diluted loss per share$(0.00)$(0.03)
Per share information attributable to Angi Inc. shareholders:
Basic loss per share$(0.00)$(0.03)
Diluted loss per share$(0.00)$(0.03)
Stock-based compensation expense by function:
Selling and marketing expense$1,232 $1,252 
General and administrative expense7,193 8,761 
Product development expense972 2,699 
Total stock-based compensation expense$9,397 $12,712 
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

4

ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF COMPREHENSIVE OPERATIONS
(Unaudited)
Three Months Ended March 31,
20242023
(in thousands)
Net loss$(1,317)$(15,000)
Other comprehensive (loss) income:
Change in foreign currency translation adjustment(781)502 
Change in unrealized gains on available-for-sale marketable debt securities 2 
Total other comprehensive (loss) income(781)504 
Comprehensive loss(2,098)(14,496)
Components of comprehensive income attributable to noncontrolling interests:
Net earnings attributable to noncontrolling interests(314)(325)
Change in foreign currency translation adjustment attributable to noncontrolling interests 36 (43)
Comprehensive income attributable to noncontrolling interests(278)(368)
Comprehensive loss attributable to Angi Inc. shareholders$(2,376)$(14,864)
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

5

ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY
Three Months Ended March 31, 2024 and 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 Income (Loss)Total
Shareholders'
Equity
Additional Paid-in CapitalAccumulated DeficitTreasury
Stock
Noncontrolling
Interests
$Shares$Shares$Shares
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 (loss) earnings— — — — — — — (1,631)— — (1,631)314 (1,317)
Other comprehensive loss— — — — — — — — (745)— (745)(36)(781)
Stock-based compensation expense— — — — — — 11,019 — — — 11,019 — 11,019 
Issuance of common stock pursuant to stock-based awards, net of withholding taxes2 2,022 — — — — (3,266)— — — (3,264)— (3,264)
Purchase of treasury stock— — — — — — — — — (6,700)(6,700)— (6,700)
Other— — — — — (422)— — — (422)— (422)
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 
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— — — — — — — (15,325)— — (15,325)325 (15,000)
Other comprehensive income— — — — — — — — 461 — 461 43 504 
Stock-based compensation expense— — — — — — 13,870 — — — 13,870 — 13,870 
Issuance of common stock pursuant to stock-based awards, net of withholding taxes 1 1,308 — — — — (2,411)— — — (2,410)— (2,410)
Other— — — — — — (5)— — — (5)— (5)
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 
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
6

ANGI INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
Three Months Ended March 31,
20242023
(In thousands)
Cash flows from operating activities attributable to continuing operations:
Net loss$(1,317)$(15,000)
Less: Loss from discontinued operations, net of tax (1,013)
Net loss attributable to continuing operations(1,317)(13,987)
Adjustments to reconcile net loss to net cash provided by operating activities attributable to continuing operations:
Depreciation23,849 25,190 
Provision for credit losses15,910 23,731 
Stock-based compensation expense9,397 12,712 
Non-cash lease expense (including impairment of right-of-use assets)4,752 3,532 
Deferred income taxes1,253 (282)
Amortization of intangibles 2,662 
Other adjustments, net384 (366)
Changes in assets and liabilities, net of effects of acquisitions and dispositions:
Accounts receivable(25,761)(22,402)
Other assets13,320 4,758 
Accounts payable and other liabilities(17,417)(10,289)
Operating lease liabilities(4,487)(4,578)
Income taxes payable and receivable2,148 845 
Deferred revenue265 (354)
Net cash provided by operating activities attributable to continuing operations22,296 21,172 
Cash flows from investing activities attributable to continuing operations:
Capital expenditures(12,798)(11,862)
Purchases of marketable debt securities (12,362)
Proceeds from sales of fixed assets6 10 
Net cash used in investing activities attributable to continuing operations(12,792)(24,214)
Cash flows from financing activities attributable to continuing operations:
Purchases of treasury stock(6,860) 
Withholding taxes paid on behalf of employees on net settled stock-based awards(3,214)(1,379)
Net cash used in financing activities attributable to continuing operations(10,074)(1,379)
Total cash used in continuing operations(570)(4,421)
Net cash used in operating activities attributable to discontinued operations (2,111)
Net cash provided by investing activities attributable to discontinued operations 57 
Total cash used in discontinued operations (2,054)
Effect of exchange rate changes on cash and cash equivalents and restricted cash(141)179 
Net decrease in cash and cash equivalents and restricted cash(711)(6,296)
Cash and cash equivalents and restricted cash at beginning of period364,301 322,136 
Cash and cash equivalents and restricted cash at end of period$363,590 $315,840 
The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
7

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 192,000 transacting service professionals actively sought consumer matches, completed jobs, or advertised work through Angi Inc. platforms during the three months ended March 31, 2024. Additionally, consumers turned to at least one of our businesses to find a service professional for approximately 21 million projects during the twelve months ended March 31, 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 March 31, 2024, IAC Inc. (“IAC”) owned 84.3% 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 11Discontinued 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.
8

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 three months ended March 31, 2024, the Company recognized $32.6 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 three months ended March 31, 2023, the Company recognized $31.9 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 March 31, 2024 are $50.1 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 are no recently issued accounting pronouncements adopted by the Company during the three months ended March 31, 2024.
9

ANGI INC. AND SUBSIDIARIES
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
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.
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.
The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis:
10

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
March 31, 2024
Level 1Level 2Level 3Total
Fair Value
Measurements
(In thousands)
Assets:
Cash equivalents:
Money market funds$171,245 $ $ $171,245 
Treasury discount notes 112,058  112,058 
Total$171,245 $112,058 $ $283,303 
December 31, 2023
Level 1Level 2Level 3Total
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 
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 $432.5 million and $418.1 million at March 31, 2024 and December 31, 2023, respectively.
NOTE 3—LONG-TERM DEBT
Long-term debt consists of:
 March 31, 2024December 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 costs3,759 3,953 
Total long-term debt, net $496,241 $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.

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 March 31, 2024, there were no limitations pursuant thereto.
NOTE 4—ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
The following table presents the components of accumulated other comprehensive income (loss), which exclusively consists of foreign currency translation adjustment for the three months ended March 31, 2024:
11

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Three Months Ended March 31,
20242023
Foreign Currency
Translation Adjustment
Foreign Currency
Translation Adjustment
Unrealized Gains on Available-For-Sale Debt SecuritiesAccumulated Other Comprehensive Loss
(In thousands)
Balance at January 1$1,187 $(1,172)$ $(1,172)
Other comprehensive (loss) income(745)459 2461 
Balance at March 31$442 $(713)$2 $(711)
There were no items reclassified out of accumulated other comprehensive income (loss) into earnings during the three months ending March 31, 2024 and 2023. At March 31, 2024, there was no tax benefit or provision on the accumulated other comprehensive loss. The income tax provision related to net unrealized gains on available-for-sale marketable debt securities was not material at March 31, 2023.
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.
The following table presents revenue by reportable segment:
Three Months Ended March 31,
20242023
(In thousands)
Revenue:
Domestic
Ads and Leads$249,585 $293,506 
Services20,451 32,059 
Total Domestic270,036 325,565 
International35,354 29,932 
Total
$305,390 $355,497 
12

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)

The following table presents the revenue of the Company’s reportable segments disaggregated by type of service:
Three Months Ended March 31,
20242023
(In thousands)
Domestic
Ads and Leads:
Consumer connection revenue$160,531 $212,935 
Advertising revenue77,137 67,181 
Membership subscription revenue11,778 13,199 
Other revenue139 191 
Total Ads and Leads revenue249,585 293,506 
Services revenue20,451 32,059 
Total Domestic revenue270,036 325,565 
International
Consumer connection revenue29,669 24,745 
Service professional membership subscription revenue5,382 5,058 
Advertising and other revenue303 129 
Total International revenue35,354 29,932 
Total revenue$305,390 $355,497 

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 March 31,
20242023
(In thousands)
Revenue
United States$269,872 $325,565 
All other countries35,518 29,932 
Total$305,390 $355,497 

March 31, 2024December 31, 2023
(In thousands)
Long-lived assets (excluding goodwill and intangible assets):
United States$132,462 $145,710 
All other countries8,554 9,788 
Total$141,016 $155,498 
The following tables present operating income (loss) and Adjusted EBITDA by reportable segment:

13

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Three Months Ended March 31,
20242023
(In thousands)
Operating income (loss):
Ads and Leads$19,821 $13,480 
Services(7,501)(12,452)
Corporate(15,117)(14,939)
International5,513 3,030 
Total$2,716 $(10,881)
Three Months Ended March 31,
20242023
(In thousands)
Adjusted EBITDA(b):
Ads and Leads$41,221 $39,851 
Services10 (2,168)
Corporate(11,921)(12,354)
International6,652 4,354 
Total$35,962 $29,683 
(b)    The Company’s primary financial 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 loss attributable to Angi Inc. shareholders to Adjusted EBITDA:
Three Months Ended March 31, 2024
Operating Income (Loss)Stock-Based
Compensation Expense
Depreciation
Adjusted
EBITDA(b)
(In thousands)
Ads and Leads$19,821 $4,465 $16,935 $41,221 
Services(7,501)1,381 6,130 10 
Corporate(15,117)3,196  (11,921)
International5,513 355 784 6,652 
Total2,716 $9,397 $23,849 $35,962 
Interest expense(5,038)
Other income, net4,484 
Earnings before income taxes2,162 
Income tax provision(3,479)
Net loss(1,317)
Net earnings attributable to noncontrolling interests(314)
Net loss attributable to Angi Inc. shareholders$(1,631)
14

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Three Months Ended March 31, 2023
Operating Income (Loss)Stock-Based
Compensation Expense
DepreciationAmortization
of Intangibles
Adjusted
EBITDA(b)
(In thousands)
Ads and Leads$13,480 $5,491 $18,218 $2,662 $39,851 
Services(12,452)4,209 6,075  (2,168)
Corporate(14,939)2,585   (12,354)
International3,030 427 897  4,354 
Total(10,881)$12,712 $25,190 $2,662 $29,683 
Interest expense(5,029)
Other income, net3,807 
Loss from continuing operations before income taxes(12,103)
Income tax provision(1,884)
Net loss from continuing operations(13,987)
Loss from discontinued operations, net of tax(1,013)
Net loss(15,000)
Net earnings attributable to noncontrolling interests(325)
Net loss attributable to Angi Inc. shareholders$(15,325)
NOTE 6—INCOME TAXES
The Company is included within IAC’s tax group for purposes of federal and consolidated state income tax return filings. In all periods presented, the income tax provision and/or benefit has been computed for the Company on an as if standalone, separate return basis and payments to and refunds from IAC for the Company’s share of IAC’s consolidated federal and state tax return liabilities/receivables calculated on this basis have been reflected within cash flows from operating activities in the statement of cash flows. The tax sharing agreement between the Company and IAC governs the parties’ respective rights, responsibilities and obligations with respect to tax matters, including responsibility for taxes attributable to the Company, entitlement to refunds, allocation of tax attributes and other matters and, therefore, ultimately governs the amount payable to or receivable from IAC with respect to income taxes. Any differences between taxes currently payable to or receivable from IAC under the tax sharing agreement and the current tax provision or benefit computed on an as if standalone, separate return basis for GAAP are reflected as adjustments to additional paid-in capital in the statement of shareholders’ equity and financing activities within the statement of cash flows.
At the end of each interim period, the Company estimates the annual expected effective income tax rate and applies that rate to its ordinary year-to-date earnings or loss. The income tax provision or benefit related to significant, unusual, or extraordinary items, if applicable, that will be separately reported or reported net of their related tax effects are individually computed and recognized in the interim period in which they occur. In addition, the effect of changes in enacted tax laws or rates, tax status, judgment on the realizability of a beginning-of-the-year deferred tax asset in future years or unrecognized tax benefits is recognized in the interim period in which the change occurs.
The computation of the annual expected effective income tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected pre-tax income (or loss) for the year, projections of the proportion of income (and/or loss) earned and taxed in foreign jurisdictions, permanent and temporary differences, and the likelihood of the realization of deferred tax assets generated in the current year. The accounting estimates used to compute the provision or benefit for income taxes may change as new events occur, more experience is acquired, additional information is obtained or the Company’s tax environment changes. To the extent that the expected annual effective income tax rate changes during a quarter, the effect of the change on prior quarters is included in income tax provision or benefit in the quarter in which the change occurs.
15

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
For the three months ended March 31, 2024, the Company recorded an income tax provision of $3.5 million due primarily to the impact of stock-based awards and unbenefited losses, partially offset by research credits. For the three months ended March 31, 2023, the Company recorded an income tax provision of $1.9 million, despite a pre-tax loss, due primarily to nondeductible stock-based compensation and foreign income taxed at different rates, partially offset by research credits.
The Company recognizes interest and, if applicable, penalties related to unrecognized tax benefits in the income tax provision. Accruals for interest are not material and there are currently no accruals for penalties.
The Company’s income taxes are routinely under audit by federal, state, local and foreign authorities as a result of previously filed separate company and consolidated tax returns with IAC. These audits include questioning the timing and the amount of income and deductions and the allocation of income and deductions among various tax jurisdictions. The Company is not currently under audit by the Internal Revenue Service. Returns filed in various other jurisdictions are open to examination for tax years beginning with 2013. Income taxes payable include unrecognized tax benefits considered sufficient to pay assessments that may result from the examination of prior year tax returns. The Company considers many factors when evaluating and estimating its tax positions and tax benefits, which may not accurately anticipate actual outcomes and, therefore, may require periodic adjustment. Although management currently believes changes in unrecognized tax benefits from period to period and differences between amounts paid, if any, upon resolution of issues raised in audits and amounts previously provided will not have a material impact on the liquidity, results of operations, or financial condition of the Company, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future.
At March 31, 2024 and December 31, 2023, the Company has unrecognized tax benefits, including interest, of $8.5 million and $8.1 million, respectively; all of which are for tax positions included in IAC’s consolidated tax return filings. If unrecognized tax benefits at March 31, 2024 are subsequently recognized, the income tax provision would be reduced by $8.0 million. The comparable amount at December 31, 2023 was $7.6 million. The Company believes that it is reasonably possible that its unrecognized tax benefits could decrease by $0.2 million by March 31, 2025 due to settlements, all of which would reduce the income tax provision.
The Company regularly assesses the realizability of deferred tax assets considering all available evidence including, to the extent applicable, the nature, frequency and severity of prior cumulative losses, forecasts of future taxable income, tax filing status, the duration of statutory carryforward periods, available tax planning and historical experience. At March 31, 2024, the Company has a U.S. gross deferred tax asset of $208.7 million that the Company expects to fully utilize on a more likely than not basis. Of this amount, $22.6 million will be utilized upon the future reversal of deferred tax liabilities and the remaining net deferred tax asset of $186.1 million will be utilized based on forecasts of future taxable income. The Company's most significant net deferred tax asset that could expire relates to U.S. federal net operating loss ("NOL") carryforwards of $101.2 million. The Company expects to generate sufficient future taxable income of at least $482.1 million prior to the expiration of these NOLs, the majority of which expire between 2033 and 2037, to fully realize this deferred tax asset.
NOTE 7—LOSS PER SHARE
The following table sets forth the computation of basic and diluted loss per share attributable to Angi Inc. Class A and Class B Common Stock shareholders:
16

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
 Three Months Ended March 31,
 20242023
 BasicDilutedBasicDiluted
 (In thousands, except per share data)
Numerator:
Net loss from continuing operations$(1,317)$(1,317)$(13,987)$(13,987)
Net earnings attributable to noncontrolling interests of continuing operations(314)(314)(325)(325)
Net loss attributable to Angi Inc. Class A and Class B Common Stock shareholders(1,631)(1,631)(14,312)(14,312)
Loss from discontinued operations  (1,013)(1,013)
Net loss attributable to Angi Inc. Class A and Class B Common Stock shareholders$(1,631)$(1,631)$(15,325)$(15,325)
Denominator:
Weighted average basic Class A and Class B common stock shares outstanding502,627 502,627 505,033 505,033 
Dilutive securities (a) (b)
—  —  
Denominator for loss per share—weighted average shares 502,627 502,627 505,033 505,033 
Loss per share attributable to Angi Inc. Class A and Class B Common Stock shareholders:
Loss per share from continuing operations$(0.00)$(0.00)$(0.03)$(0.03)
Loss per share from discontinued operations, net of tax  (0.00)(0.00)
Loss per share attributable to Angi Inc. Class A and Class B Common Stock shareholders$(0.00)$(0.00)$(0.03)$(0.03)
________________________
(a)    If the effect is dilutive, weighted average common shares outstanding include the incremental shares that would be issued upon the assumed exercise of stock options and subsidiary denominated equity and vesting of restricted stock units (“RSUs”). For the three months ended March 31, 2024 and 2023, 28.4 and 29.6 million, respectively, of potentially dilutive securities were excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive. Accordingly, the weighted average basic shares outstanding were used to compute all loss per share amounts.
(b)    Market-based awards (“MSUs”) and performance-based stock units (“PSUs”) are considered contingently issuable shares. Shares issuable upon exercise or vesting of MSUs and PSUs are included in the denominator for earnings per share if (i) the applicable market or performance condition(s) has been met and (ii) the inclusion of the MSUs and PSUs is dilutive for the respective reporting periods. For the three months ended March 31, 2024 and 2023, 0.4 million and 0.9 million underlying MSUs and PSUs, respectively, were excluded from the calculation of diluted earnings per share because the market or performance condition(s) had not been met.
NOTE 8—FINANCIAL STATEMENT DETAILS
Cash and Cash Equivalents and Restricted Cash
The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the balance sheet to the total amounts shown in the statement of cash flows:
17

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
March 31, 2024December 31, 2023March 31, 2023December 31, 2022
(In thousands)
Cash and cash equivalents$363,337 $364,044 $314,960 $321,155 
Restricted cash included in other current assets   107 
Restricted cash included in other non-current assets253 257 376 371 
Restricted cash included in other non-current assets of discontinued operations  504 503 
Total cash and cash equivalents, and restricted cash as shown on the statement of cash flows$363,590 $364,301 $315,840 $322,136 
Restricted cash included in “Other current assets” in the balance sheet at December 31, 2022 primarily consisted of cash reserved to fund insurance claims.
Restricted cash included in “Other non-current assets” in the balance sheets for all periods presented above primarily consisted of deposits related to leases.
Credit Losses
The following table presents the changes in the allowance for credit losses for the three months ended March 31, 2024 and 2023:
20242023
(In thousands)
Balance at January 1
$24,684 $38,846 
Current period provision for credit losses15,910 23,731 
Write-offs charged against the allowance for credit loss(21,087)(27,809)
Recoveries collected
1,263 1,236 
Balance at March 31
$20,770 $36,004 
Accumulated Amortization and Depreciation
The following table provides the accumulated depreciation and amortization within the balance sheet:
Asset CategoryMarch 31, 2024December 31, 2023
 (In thousands)
Capitalized software, leasehold improvements, and equipment$229,347 $215,357 
Intangible assets$89,142 $89,229 
Other income, net
Three Months Ended March 31,
 20242023
 (In thousands)
Interest income$4,709 $3,419 
Other(225)388 
Other income, net$4,484 $3,807 

18

ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
NOTE 9—CONTINGENCIES
In the ordinary course of business, the Company is a party to various lawsuits. The Company establishes accruals for specific legal matters when it determines that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable. The total accrual for legal matters is $1.7 million at March 31, 2024. Management has also identified certain other legal matters where it believes an unfavorable outcome is not probable and, therefore, no accrual is established. Although management currently believes that resolving claims against the Company, including claims where an unfavorable outcome is reasonably possible, and for which the Company cannot estimate a loss or range of loss, will not have a material impact on the liquidity, results of operations, or financial condition of the Company, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future. The Company also evaluates other contingent matters, including uncertain income tax positions and non-income tax contingencies, to assess the likelihood of an unfavorable outcome and estimated extent of potential loss. It is possible that an unfavorable outcome of one or more of these lawsuits or other contingencies could have a material impact on the liquidity, results of operations, or financial condition of the Company. See “Note 6—Income Taxes” for information related to uncertain income tax positions.
NOTE 10—RELATED PARTY TRANSACTIONS WITH IAC
Allocation of CEO Compensation and Certain Expenses
Joseph Levin, CEO of IAC and Chairman of Angi, was appointed CEO of Angi on October 10, 2022. As a result, for the three months ended March 31, 2024 and 2023, IAC allocated $2.2 million and $2.3 million, respectively, in costs to Angi (including salary, benefits, stock-based compensation and costs related to the CEO’s office). These costs were allocated from IAC based upon time spent on Angi by Mr. Levin. Management considers the allocation method to be reasonable. The allocated costs also include costs directly attributable to the Company that were initially paid for by IAC and billed by IAC to the Company.
On April 8, 2024, Jeffrey W. Kip, President of Angi Inc., was appointed to succeed Joseph Levin as CEO of Angi Inc. Mr. Levin will remain Chairman of the Angi Inc. board of directors.
The Combination and Related Agreements
The Company and IAC, in connection with the transaction resulting in the formation of Angi Inc. in 2017, which is referred to as the “Combination,” entered into a contribution agreement; an investor rights agreement; a services agreement; a tax sharing agreement; and an employee matters agreement, which collectively govern the relationship between IAC and Angi Inc.
For the three months ended March 31, 2024 and 2023, the Company was charged by IAC $1.2 million and $1.5 million, respectively, for services rendered pursuant to the services agreement. There were no outstanding payables pursuant to the services agreement at March 31, 2024 and December 31, 2023.
At March 31, 2024 and December 31, 2023, the Company had outstanding payables of $2.8 million and $2.1 million, respectively, due to IAC pursuant to the tax sharing agreement, which are included in “Accrued expenses and other current liabilities,” in the balance sheet. There were no payments to or refunds from IAC pursuant to this agreement during the three months ended March 31, 2024 and 2023.
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ANGI INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(Unaudited)
Other Arrangements
Additionally, the Company subleases office space to IAC and charged rent pursuant to a lease agreement of $0.1 million and $0.4 million for the three months ended March 31, 2024 and 2023, respectively. IAC subleases office space to the Company and charged rent pursuant to a lease agreement of $0.3 million and $0.3 million for the three months ended March 31, 2024 and 2023, respectively. At March 31, 2024, the Company has an outstanding receivable of $0.3 million due from IAC pursuant to the sublease agreements. This amount is included in “Other non-current assets” in the balance sheet. At December 31, 2023, there were outstanding receivables of $0.3 million due from IAC and no payable due to IAC pursuant to the sublease agreements.
The Company incurred advertising expense of $1.2 million and $1.8 million for the three months ended March 31, 2024 and 2023, respectively, related to advertising and audience targeted advertising purchased from another IAC owned business. At March 31, 2024 and December 31, 2023, there were related outstanding payables of $0.7 million and $1.3 million, respectively, included in “Accrued expenses and other current liabilities” in the balance sheet.
NOTE 11—DISCONTINUED OPERATIONS
On November 1, 2023, Angi Inc. completed the sale of 100% of its wholly-owned subsidiary, THR, and has reflected it as a discontinued operation in its financial statements. The financial information for prior periods has been recast to conform to this presentation.

The components of the loss from discontinued operations for the three months ended March 31, 2023, in the statement of operations consisted of the following:
Three Months Ended March 31,
2023
(In thousands)
Revenue$38,372 
Operating costs and expenses:
Cost of revenue (exclusive of depreciation shown separately below)25,104 
Selling and marketing expense6,761 
General and administrative expense5,851 
Depreciation245 
Total operating costs and expenses37,961 
Operating income from discontinued operations411 
Interest income4 
Income from discontinued operations before tax415 
Income tax provision(1,428)
Loss from discontinued operations, net of tax$(1,013)
During the period in which Angi owned THR, the Ads & Leads segment provided services totaling $1.5 million to the Roofing segment for the three months ended March 31, 2023. Such services have and will continue in periods subsequent to the disposition of the Roofing segment on November 1, 2023.
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Item 2.    Management’s Discussion and Analysis of Financial Condition and Results of Operations
GENERAL
Management Overview
Angi Inc. (“Angi,” the “Company,” “we,” “our,” or “us”) connects quality home service professionals with consumers across more than 500 different categories, from repairing and remodeling homes to cleaning and landscaping. Approximately 192,000 transacting service professionals actively sought consumer matches, completed jobs, or advertised work through Angi Inc. platforms during the three months ended March 31, 2024. Additionally, consumers turned to at least one of our businesses to find a service professional for approximately 21 million projects during the twelve months ended March 31, 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.
For a more detailed description of the Company’s operating businesses, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
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. The financial information for prior periods has been recast to conform to this presentation. For additional details, see “Note 11—Discontinued Operations” to the consolidated financial statements included in “Item 1. Consolidated Financial Statements.”
Defined Terms and Operating Metrics:
Unless otherwise indicated or as the context otherwise requires, certain terms, which include the principal operating metrics we use in managing our business, are defined below:
Ads and Leads Revenue primarily comprises domestic revenue from consumer connection revenue for consumer matches, revenue from service professionals under contract for advertising and membership subscription revenue from service professionals and consumers.
Services Revenue primarily comprises domestic revenue from pre-priced offerings by which the consumer requests services through a Company platform and the Company connects them with a service professional to perform the service.
International Revenue primarily comprises revenue generated within the International segment (consisting of businesses in Europe and Canada), including consumer connection revenue for consumer matches and membership subscription revenue from service professionals and consumers.
Corporate primarily comprises costs for corporate initiatives, shared costs, such as executive and public company costs, and other expenses not allocated to the operating segments.
Service Requests are (i) fully completed and submitted domestic service requests for connections with Ads and Leads service professionals, (ii) contacts to Ads and Leads service professionals generated via the service professional directory from unique users in unique categories (such that multiple contacts from the same user in the same category in the same day are counted as one Service Request) and (iii) requests to book Services jobs in the period.
Monetized Transactions are (i) Service Requests that are matched to a paying Ads and Leads service professional in
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the period and (ii) completed and in-process Services jobs in the period; a single Service Request can result in multiple monetized transactions.
Transacting Service Professionals (“Transacting SPs”) are the number of (i) Ads and Leads service professionals that paid for consumer matches or advertising and (ii) Services service professionals that performed a Services job, during the most recent quarter.
ANGI Group Senior Notes - On August 20, 2020, ANGI Group, LLC (“ANGI Group”), a direct wholly-owned subsidiary of the Company, issued $500.0 million of its 3.875% Senior Notes due August 15, 2028, with interest payable February 15 and August 15 of each year.
Components of Results of Operations
Cost of Revenue and Gross Profit
Cost of revenue, which excludes depreciation, consists primarily of (i) credit card processing fees, (ii) hosting fees, and (iii) payments made to independent third-party service professionals who perform work.
Gross profit is revenue less cost of revenue. Gross margin is gross profit expressed as a percentage of revenue.
Operating Costs and Expenses:
Selling and marketing expense - consists primarily of (i) advertising expenditures, which include marketing fees to promote the brand to consumers and service professionals with (a) online marketing, including fees paid to search engines and other online marketing platforms, partners who direct traffic to our brands, and app platforms, and (b) offline marketing, which is primarily television and radio advertising, (ii) compensation expense (including stock-based compensation expense) and other employee-related costs for our sales and marketing personnel, (iii) service guarantee expense, (iv) software license and maintenance costs, and (v) outsourced personnel costs.
General and administrative expense - consists primarily of (i) compensation expense (including stock-based compensation expense) and other employee-related costs for personnel engaged in executive management, finance, legal, tax, human resources and customer service functions, (ii) provision for credit losses, (iii) software license and maintenance costs, (iv) outsourced personnel costs for personnel engaged in assisting in customer service functions, (v) fees for professional services, and (vi) rent expense and facilities costs (including impairments of right-of-use assets). Our customer service function includes personnel who provide support to our service professionals and consumers.
Product development expense - consists primarily of (i) compensation expense (including stock-based compensation expense) and other employee-related costs that are not capitalized for personnel engaged in the design, development, testing and enhancement of product offerings and related technology, (ii) software license and maintenance costs, and (iii) outsourced personnel costs for personnel engaged in product development.
Non-GAAP financial measure
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) is a non-GAAP financial measure. See “Principles of Financial Reporting” for the definition of Adjusted EBITDA and a reconciliation of net loss attributable to Angi Inc. shareholders to operating income (loss) to consolidated Adjusted EBITDA for the three months ended March 31, 2024 and 2023.
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Results of Operations for the Three Months Ended March 31, 2024 compared to the Three Months Ended March 31, 2023
The following discussion should be read in conjunction with “Item 1. Consolidated Financial Statements.”
Revenue
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
Domestic
Ads and Leads:
Consumer connection revenue$160,531 $212,935 $(52,404)(25)%
Advertising revenue77,137 67,181 9,956 15%
Membership subscription revenue11,778 13,199 (1,421)(11)%
Other revenue139 191 (52)(27)%
Total Ads and Leads revenue249,585 293,506 (43,921)(15)%
Services revenue20,451 32,059 (11,608)(36)%
Total Domestic revenue270,036 325,565 (55,529)(17)%
International revenue35,354 29,932 5,422 18%
Total revenue$305,390 $355,497 $(50,107)(14)%
Percentage of Total Revenue:
Domestic88 %92 %
International12 %%
Total revenue100 %100 %
Three Months Ended March 31,
20242023Change% Change
(In thousands, rounding differences may occur)
Operating metrics:
Service Requests4,126 6,004 (1,878)(31)%
Monetized Transactions5,511 6,451 (940)(15)%
Transacting SPs192 206 (14)(7)%
Ads and Leads revenue decreased $43.9 million, or 15%, due primarily to a decrease in consumer connection revenue of $52.4 million, or 25%, partially offset by an increase of $10.0 million, or 15%, in advertising revenue. The decrease in consumer connection revenue was due primarily to declines in Monetized Transactions as a result of fewer transacting SPs resulting from a reduction in unprofitable sales and changes to demand channels to increase lead quality to enhance the user experience for both homeowners and service professionals and to improve profitability through greater matching efficiency and bidding optimization as evidenced by a higher ratio of Monetized Transactions per Service Request. The increase in advertising revenue was primarily driven by continued growth in sales.
Services revenue decreased $11.6 million, or 36%, due primarily to lower Service Requests as a result of certain efforts described in Ads and Leads above. In addition, the decrease in revenue reflects the residual impact from contracts entered into prior to January 1, 2023 and recognized as gross revenue in the first quarter of 2023. Effective January 1, 2023, Angi Inc. modified the Services terms and conditions resulting in net revenue reporting.
International revenue increased $5.4 million, or 18%, due primarily to a larger service professional network and higher revenue per service professional.
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Cost of revenue
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
Cost of revenue (exclusive of depreciation shown separately below)$12,497 $16,937 $(4,440)(26)%
As a percentage of revenue4%5%
Services cost of revenue decreased $5.9 million, or 66%, and decreased as a percentage of revenue, due primarily to a $5.3 million decrease in payments to third-party professional service providers primarily reflecting the residual impact from contracts entered into prior to January 1, 2023.
Gross profit
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
Revenue$305,390 $355,497 $(50,107)(14)%
Cost of revenue (exclusive of depreciation shown separately below)12,497 16,937 (4,440)(26)%
Gross profit$292,893 $338,560 $(45,667)(13)%
Gross margin96%95%1%
Angi gross profit decreased $45.7 million, or 13%, due primarily to the decrease in revenue described in the revenue discussion above.
Selling and marketing expense
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
Selling and marketing expense$157,051 $199,610 $(42,559)(21)%
As a percentage of revenue51%56%
Ads and Leads selling and marketing expense decreased $40.3 million, or 23%, driven by decreases in advertising expense of $31.9 million due to improved efficiency and compensation expense of $7.5 million primarily due to a reduction in headcount.
Services selling and marketing expense decreased $4.4 million, or 35%, driven by a decrease of $1.9 million in compensation expense. The decrease in compensation expense is primarily due to lower headcount beginning in the second quarter of 2023.
General and administrative expense
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
General and administrative expense$85,521 $96,667 $(11,146)(12)%
As a percentage of revenue28%27%
Ads and Leads general and administrative expense decreased $7.4 million, or 12%, due primarily to decreases of $7.7 million in the provision for credit losses and $3.5 million in professional fees, partially offset by a $1.9 million increase in lease expense. The decrease in the provision for credit losses is primarily due to lower revenue and improved collection rates. The decrease in professional fees is primarily due to a reduction in legal-related expenses. The increase in lease expense is primarily due to an impairment charge of a right-of-use asset recognized in the first quarter of 2024 related to the Company reducing its real estate footprint.
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Services general and administrative expense decreased $4.3 million, or 34%, due primarily to a decrease of $3.7 million in compensation expense due primarily to a $2.9 million decrease in stock-based compensation as a result of a reduction in headcount.
Product development expense
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
Product development expense$23,756 $25,312 $(1,556)(6)%
As a percentage of revenue8%7%
Product development expense decreased $1.6 million, or 6%, and is not materially different from the first quarter of 2023.
Depreciation
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
Depreciation$23,849 $25,190 $(1,341)(5)%
As a percentage of revenue8%7%
Depreciation decreased $1.3 million, or 5%, and is not materially different from the first quarter of 2023.
Operating income (loss)
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
Ads and Leads$19,821 $13,480 $6,341 47%
Services(7,501)(12,452)4,951 40%
Corporate(15,117)(14,939)(178)(1)%
Total Domestic(2,797)(13,911)11,114 80%
International5,513 3,030 2,483 82%
Total$2,716 $(10,881)$13,597 NM
As a percentage of revenue1%(3)%
________________________
NM = Not meaningful
Operating loss decreased $13.6 million to income of $2.7 million due primarily to the factors described above in the revenue, cost of revenue, sales and marketing, general and administrative, product development, and depreciation expense discussions.
At March 31, 2024, there was $48.7 million of unrecognized compensation cost, net of estimated forfeitures, related to all equity-based awards, which is expected to be recognized over a weighted average period of approximately 2.35 years.
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Adjusted EBITDA
Three Months Ended March 31,
20242023$ Change% Change
(Dollars in thousands)
Ads and Leads$41,221 $39,851 $1,370 3%
Services10 (2,168)2,178 NM
Corporate(11,921)(12,354)433 4%
Total Domestic29,310 25,329 3,981 NM
International6,652 4,354 2,298 53%
Total $35,962 $29,683 $6,279 21%
 As a percentage of revenue12%8%
For a reconciliation of net loss attributable to Angi Inc. shareholders to operating income (loss) to consolidated Adjusted EBITDA, see “Principles of Financial Reporting.” For a reconciliation of operating income (loss) to Adjusted EBITDA for the Company’s reportable segments, see “Note 5—Segment Information” to the financial statements included in “Item 1. Consolidated Financial Statements.”
Ads and Leads Adjusted EBITDA increased $1.4 million, or 3%, to $41.2 million, and increased as a percentage of revenue, driven by lower selling and marketing expense due to improved marketing efficiency and lower general and administrative expense due to the decrease in the provision for credit losses and legal-related expenses, partially offset by lower gross profit due to a decrease in revenue and an increase in lease expense.
Services Adjusted EBITDA increased $2.2 million, from a loss of $2.2 million to income of less than $0.1 million, and increased as a percentage of revenue, driven by lower operating expenses due to a reduced overall cost base as a result of exiting complex and less profitable offerings.
International Adjusted EBITDA increased $2.3 million, or 53%, to $6.7 million, driven by an increase in revenue.
Interest expense
Interest expense relates to interest on the ANGI Group Senior Notes.
For a detailed description of long-term debt, net, see “Note 3—Long-term Debt” to the financial statements included in “Item 1. Consolidated Financial Statements.”
Three Months Ended March 31,
20242023$ Change% Change
(In thousands)
Interest expense$(5,038)$(5,029)$(9)—%
Interest expense was flat compared to the first quarter of 2023.
Other income, net
Three Months Ended March 31,
20242023$ Change% Change
(In thousands)
Other income, net$4,484 $3,807 $677 18%
Other income, net for the three months ended March 31, 2024 and 2023 includes interest income of $4.7 million and $3.4 million, respectively.
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Income tax provision