Although the broader stock market traded flat on Wednesday, numerous titles were outliers in terms of their price movements. Unfortunately for its investors, LegalZoom (LZ) was one of them, and not positively. The company's share price tumbled by nearly 24% after it divulged first-quarter results.
A pair of narrow quarterly misses
Those figures were made public after market hours Tuesday, and they revealed that LegalZoom booked slightly more than $174 million in revenue; this was 5% higher on a year-over-year basis. Much of this comprised subscription revenue for the company's suite of legal services. That line item was a shade under $108 million, for growth of 10%.
Non-GAAP (generally accepted accounting principles) adjusted net income also climbed, advancing by a robust 31% to $18.3 million, or $0.09 per diluted share.
On average, analysts following LegalZoom stock were modeling a slightly higher revenue figure of $175.4 million. The company also narrowly missed on the bottom line, as the collective prognosticator estimate for adjusted net income was $0.10 per share.
In the earnings release, chief financial officer Noel Watson was quoted as saying, "Our solid execution enabled us to achieve our revenue expectations despite a weaker-than-expected macro environment."
In-line annual revenue guidance
LegalZoom proffered guidance for both its current (second) quarter, and the entirety of 2024. For the latter period, it's anticipating revenue of $700 million to $720 million. While this compares favorably to the 2023 tally of $660 million, it's only in line with the average analyst estimate of $713.9 million.
Meanwhile, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) should land at $135 million to $145 million. No net income forecasts were provided.
