IAC Inc. Reports Decline in Website Traffic Amid Google's AI Integration

IAC Inc. faces a significant drop in website traffic due to Google's search algorithm changes, declining from 52% to 28%. Analyst consensus suggests a potential upside, with an average price target of $49.00, and a potential downside of 23.27% compared to the current price of $34.04, according to GuruFocus GF Value.

IAC Inc. (IAC) reported a significant drop in website traffic, declining from 52% to 28% due to changes in Google's search algorithm, according to the company's Q2 earnings call [1]. The decline has led to a 7.5% year-on-year revenue drop, with revenue falling to $586.9 million compared to analyst estimates of $601.5 million [1].

Despite the traffic decline, analysts remain optimistic about IAC's long-term prospects. The average price target among analysts is $49.00, suggesting a potential upside of 43.74% from the current price of $34.04, according to GuruFocus GF Value [2]. This optimism is driven by IAC's diversified business model, which includes owned-and-operated sessions and off-platform views, as well as its focus on audience diversification away from Google Search [1].

IAC's CEO, Neil Vogel, acknowledged the persistent headwinds from changes in Google search and AI-powered competition, emphasizing that the company is accelerating its push into diversified audience channels to mitigate the impact [1]. The company has also been investing in new product lines and broader distribution channels, which are expected to contribute to future resilience [1].

Looking ahead, analysts will be closely monitoring the ramp-up and monetization of IAC's proprietary ad platforms, such as D/Cipher+, as well as engagement trends and revenue contributions from new app launches like the People app and Care.com enhancements [1]. Additionally, capital allocation decisions, including M&A and potential divestitures, will be key indicators of strategic execution [1].

IAC currently trades at $34.29, down from $39.51 just before the earnings announcement. The company's market capitalization stands at $2.72 billion, with a debt-to-equity ratio of 0.30 and a quick ratio of 2.70 [2].

References:
[1] https://finance.yahoo.com/news/5-insightful-analyst-questions-iac-042548055.html
[2] https://www.marketbeat.com/instant-alerts/benchmark-lowers-iac-nasdaqiac-price-target-to-6000-2025-08-06/