What happened
Shares of Angi (ANGI 5.34%) were taking a dive today after the company reported a sharp drop in revenue, but made progress on the bottom line.
As a result, the stock was down 30.3% as of 1:44 p.m. ET.
So what
Angi said that revenue in the quarter was down 27% to $375.1 million, reflecting a change in the way it recognizes revenue in its services segment. On a pro forma basis, revenue was down 16%. That result was in line with analyst estimates.
The company now recognizes revenue on a net basis in services rather than on a gross basis, meaning it doesn't count the revenue it pays out to service providers. As a result, services revenue fell 72% to $29.9 million, and revenue declined in roofing as well, down 43% to $24.5 million. Its core ads and leads business also saw revenue fall 14% to $292.5 million.
The macroeconomic environment continued to weigh on the business as the housing market slowed down and interest rates rose. Service requests were down by 21% to 6.86 million and transacting service professionals on the platform also fell 22% to 207,000.
On the bottom line, the company narrowed its operating loss from $20.9 to $16.7 million and reported adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $18.3 million, up from $9.7 million in the quarter a year ago.
Its loss per share narrowed from $0.05 to $0.03, which missed estimates at a loss of $0.02 per share.
Now what
For the full year, the company guided to an operating loss between $15 million and $70 million, and an adjusted EBITDA profit of $100 million to $130 million.
The company, which was formed by IAC with the merger of HomeAdvisor and Angie's List in 2017, has now been through multiple phases of the housing cycle and has struggled the whole way through.
With service requests, transactions, and the number of pros using its marketplace all down, it's not a surprise the stock is getting torched again today.
