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- **Record Q3 Growth**: Transaction value up 30% YoY to $589 million, driven by 41% P&C growth.
- **Carrier Spend Momentum**: 13 carriers spending >$1M/month, with soft market cycle expected to sustain advertising investment.
- **Health Vertical Reset**: Under-65 transaction value to stabilize at $95-100M annually, with Medicare Advantage partnerships strong.
- **Take Rate Guidance**: Q4 2025 take rate ~7%, with potential improvement as demand broadens.
- **Share Buybacks**: $50M authorized, reflecting confidence in long-term value.

**【CEO Summary Section】**
- MediaAlpha reported record Q3 2025 results, with transaction value up 30% YoY to $589 million, driven by 41% growth in the P&C insurance vertical.
- P&C carriers are increasing marketing spend due to high underwriting margins, with 13 carriers spending over $1 million/month in Q3, the highest on record.
- The health insurance vertical saw a 40% YoY decline in transaction value due to a reset in the under-65 subvertical, but Medicare Advantage partnerships remain strong.
- CEO emphasized the long-term opportunity in digital insurance distribution, with AI poised to reshape consumer behavior and carrier strategies.

**【CFO Financial Commentary】**
- Adjusted EBITDA rose 11% YoY to $29.1 million, with a 64% contribution-to-EBITDA conversion rate.
- Take rate decreased due to: (1) under-65 subvertical decline, (2) outsized spend from leading P&C carriers, and (3) new private marketplace wins.
- Q4 2025 guidance: transaction value $620-645 million (27% YoY growth), revenue $280-300 million (-4% YoY), and adjusted EBITDA $27.5-29.5 million (-22% YoY).
- CFO announced a $50 million share repurchase program, reflecting confidence in long-term growth.

**【Q&A Highlights】**
- **Carrier Spend Sustainability**: CEO stated the soft market cycle is just beginning, with 2026 expected to see broader carrier participation in advertising.
- **Health Vertical Reset**: Under-65 transaction value will stabilize at $95-100 million annually, with contribution of $10-11 million.
- **Take Rate Dynamics**: Q4 2025 take rate ~7%, with potential improvement as demand broadens beyond top carriers.
- **AI Investment**: Company leveraging AI to enhance operational efficiency and support carrier campaigns through managed services.


MediaAlpha, Inc. (MAX) Q3 2025 Earnings Call Transcript

- **FTC Settlement**: $45 million paid to resolve under-65 investigation, with compliance measures to strengthen safeguards.
- **P&C Dominance**: 71% YoY transaction growth driven by auto insurers' ad spend; tariffs and rate increases manageable.
- **Health Challenges**: Under-65 contribution down 80% YoY; long-term Medicare growth opportunity offset by near-term carrier caution.
- **Financial Outlook**: Q3 EBITDA expected to grow 1% YoY, with focus on deleveraging and strategic investments.
- **Strategic Shifts**: Scaling back under-65 business while prioritizing P&C market share and data-driven optimization.

**【CEO Summary Section】**
- **FTC Resolution**: Settled with the FTC for $45 million, including compliance measures. The company views this as a positive step to resolve the under-65 health insurance investigation.
- **Q2 Performance**: 
  - **P&C Insurance**: Transaction value grew 71% YoY, driven by increased marketing spend from auto insurers. Slowing rate increases and tariffs are manageable, supporting continued premium growth.
  - **Health Insurance**: Under-65 transaction value declined 32% YoY, but the business remains profitable. Long-term growth opportunity in Medicare Advantage direct-to-consumer marketing is noted.
- **Strategic Focus**: Prioritizing market share in P&C and scaling back higher-margin under-65 business to align with compliance requirements.

**【CFO Financial Commentary】**
- **Q2 Financials**: 
  - Transaction value: $481 million (49% YoY growth)
  - Adjusted EBITDA: $24.5 million (31% YoY growth)
  - Under-65 contribution: $1 million (80% YoY decline)
- **Q3 Guidance**: 
  - Transaction value: $545-$570 million (23% YoY growth)
  - Revenue: $270-$290 million (8% YoY growth)
  - Adjusted EBITDA: $25.5-$27.5 million (1% YoY growth)
- **Liquidity**: $85 million cash on hand, with plans to deleverage and extend debt maturity to 2027.

**【Q&A Key Highlights】**
- **P&C Growth Drivers**: Existing carriers (70% of growth) and new supply partners, despite lower take rates. Auto insurers' strong underwriting margins support ad spend.
- **Margin Strategy**: Currently optimizing for transaction value over profitability, but plans to shift focus to gross profit in a softening market.
- **Capital Allocation**: Prioritizing debt reduction and strategic investments, with no immediate share buyback plans.
- **Medicare Outlook**: Anticipated consumer shopping behavior due to AEP changes, but cautious carrier budgets may limit ad spend growth.


MediaAlpha, Inc. (MAX) Q2 2025 Earnings Call Transcript

- **P&C Surge**: 200% YoY growth in P&C vertical; Q2 guide implies 65-75% YoY expansion.
- **Medicare Shift**: Medicare now >40% of health transaction value; CMS rate hike signals policy tailwind.
- **Financial Strength**: Adjusted EBITDA doubles to $29.4M; Q2 EBITDA guide +39% YoY.
- **Tariff Risk**: Potential low-single-digit loss cost increases in H2; carriers well-positioned to adjust rates.
- **Travel Exit**: Full exit by Q2 end to focus on core insurance verticals.

**【CEO Opening Remarks】**
- Q1 2025 transaction value reached $473 million, up 116% YoY, driven by 200% growth in P&C insurance vertical.
- P&C carriers increased marketing investments amid strong profitability; Q2 P&C transaction value expected to grow 65-75% YoY.
- Health vertical transaction value down 17% YoY, with strategic focus shifting to Medicare Advantage (now >40% of health transaction value).
- FTC Matter reserve increased to $12 million; ongoing discussions aim for resolution in long-term shareholders' interest.

**【CFO Financial Highlights】**
- Q1 adjusted EBITDA doubled to $29.4 million (67% of transaction value), including $6.9 million FTC-related add-backs.
- Q2 guidance: transaction value $470-495 million (50% YoY midpoint), revenue $235-255 million (37% YoY), adjusted EBITDA $25-27 million (39% YoY).
- Exiting travel vertical by Q2 end; cash flow $20 million, net debt/EBITDA <1x.

**【Q&A Key Takeaways】**
- **P&C Growth Drivers**: Carriers' profitability (~$20 billion+ annual surplus) supports sustained marketing spend; new entrants broadening demand.
- **Tariff Impact**: Potential low-single-digit loss cost increases in H2; carriers expect to offset via rate adjustments.
- **Medicare Advantage**: CMS 5%+ payment rate hike signals regulatory tailwind; long-term growth driven by aging population.
- **Under-65 Health Scaling**: 25-30% YoY decline in health transaction value as focus shifts to Medicare.
- **FTC Timeline**: No statutory resolution deadline; updates to be disclosed quarterly.

**【Operational Efficiency】**
- Overhead to increase $500k-$1 million QoQ for growth-supporting headcount.
- Unlevered free cash flow expected as >80% of EBITDA due to minimal capex and working capital needs.

MediaAlpha (MAX)-30 Apr 25-2025 Q1 Earnings call transcript

- **P&C Dominance**: 150%+ YoY transaction growth driven by carrier profitability recovery; 2025 outlook bullish on competitive ad spend.
- **Health Headwinds**: Q4 under-65 demand down 8% YoY; Medicare Advantage faces near-term challenges but $0.5T opportunity remains.
- **Legal Risk**: $7M FTC reserve booked; potential resolution could impact under-65 business but Medicare focus continues.
- **Q1 Guidance**: P&C +170% YoY, Health -high-teens YoY; EBITDA growth 77% YoY.

**【CEO Key Highlights】**
- **P&C Insurance Growth**: 2024 transaction value grew over 150% YoY, driven by carrier profitability recovery and competitive ad spend. Q4 pricing moderation reflects carriers' locked-in 2024 targets, but 2025 outlook is bullish due to rate adequacy and consumer shopping trends.
- **Health Insurance Challenges**: Under-65 demand softened in Q4 (-8% YoY), while Medicare Advantage faces near-term headwinds. Long-term opportunity in Medicare ($0.5T industry) remains, with 7/10 top carriers as partners.
- **Legal Update**: FTC settlement discussions ongoing; $7M reserve booked under GAAP for potential resolution, representing lower-end estimate of losses.

**【CFO Financial Breakdown】**
- **Q4 2024 Results**: 
  - Transaction Value: $499.2M (150% YoY growth)
  - Adjusted EBITDA: $36.7M (200% YoY growth)
  - Health Vertical: $270M TV (18% of total), 14% take rate
- **Q1 2025 Guidance**: 
  - P&C TV: +170% YoY (high single-digit sequential decline)
  - Health TV: -high-teens YoY
  - Adjusted EBITDA: $24.5-26.5M (77% YoY growth)
  - Overhead: $500K-1M sequential increase
- **Balance Sheet**: $43M cash, net debt/2024 EBITDA <1.3x; targeting free cash flow conversion post-deleveraging.

**【Q&A Key Takeaways】**
- **P&C Market Dynamics**: 2025 expected to see increased ad spend as carriers shift from rate hikes to customer acquisition. Q1 pricing moderation reflects annual budget resets, but momentum should build as carriers compete for market share.
- **Health Vertical Strategy**: Focus on Medicare Advantage growth despite near-term under-65 softness. FTC resolution could impact under-65 business, but long-term focus remains on Medicare.
- **Investment Priorities**: Data science capabilities and agent-based partnerships to enhance marketplace efficiency and expand distribution channels.

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