LendingTree's Q1 2025: Unraveling Growth Expectations and Revenue Contradictions in Insurance and Mortgages

Insurance segment growth expectations, mortgage industry growth expectations, insurance revenue and margin expectations are the key contradictions discussed in LendingTree's latest 2025Q1 earnings call.



Segmental Revenue Growth and Adjusted EBITDA Performance:
- All three of LendingTree's business segments, including Insurance, Consumer, and Home, generated solid revenue growth in the first quarter.
- Adjusted EBITDA, however, came in below forecasts due to temporary regulatory headwinds in the Insurance segment and one-time expenses related to benefits and legal fees.
- The company expects strong adjusted EBITDA growth of 15% at the midpoint of its annual outlook.

Insurance Segment Recovery:
- The Insurance segment reported 71% year-over-year revenue growth in the first quarter, despite challenges from regulatory issues and marketing corrections.
- The segment is expected to rebound with annual revenue and BMD growth, as the company has reverted to its previous customer experience and carriers are adjusting their marketing strategies.

Small Business Lending Expansion:
- The Consumer segment benefited from growth in small business loans, with $20 million in revenue in the quarter, indicating record potential for 2025.
- The growth in small business is attributed to investments in concierge sales teams, leading to improved unit economics, higher conversion rates, and increased lender bonus revenue.

Mortgage Market Unlocking Potential:
- Despite a historically low mortgage marketplace, LendingTree sees potential growth as interest rates drop, particularly if 30-year mortgages start with a '5' handle.
- The company is optimistic about future growth in the mortgage marketplace, supported by technology advancements that reduce lender burden and improve the loan process.

Macro and Tariff Impact Mitigation:
- LendingTree is closely monitoring macroeconomic conditions and tariff impacts but does not currently anticipate significant tightening.
- The company is resilient to macroeconomic fluctuations due to its two-sided marketplace model, leveraging marketing offsets to accommodate changes in lender or carrier demand.