Angi Inc. Reports Q1 2025 Results: Challenges and Strategic Shifts
Angi Inc., a prominent player in the home services sector, has released its financial results for the first quarter of 2025, revealing a complex landscape of operational adjustments and financial challenges. As a company that connects consumers with quality professionals across more than 500 categories, Angi has seen fluctuations in its revenue streams while implementing strategic changes aimed at improving efficiency and consumer satisfaction.
1. General Overview
As of March 31, 2025, Angi Inc. maintained approximately 134,000 Average Active Monthly Professionals (Pros) and facilitated connections for around 16 million projects in the past year. The company operates through two primary segments—Domestic and International—encompassing services in Europe and Canada under various brands, including Angi, HomeAdvisor, and Handy.
In response to evolving market dynamics, Angi has recently adopted a homeowner choice model, allowing consumers to select their Pros rather than relying on automatic matching. This shift is part of a broader strategy to enhance service quality and streamline operations, which also includes consolidating its Domestic sales force and discontinuing the sale of a legacy advertising product.
2. Distribution and Ownership Changes
A significant shift occurred on March 31, 2025, when IAC Inc. completed a spin-off of its ownership in Angi through a special dividend of common stock. Following the conversion of all Class B Common Stock to Class A, IAC no longer holds any ownership in Angi, which now operates solely with Class A shares outstanding.
3. Financial Performance Overview
Revenue Declines
For the three months ending March 31, 2025, Angi reported a Domestic revenue decrease of $57.5 million, or 21%, largely driven by a $45.1 million decline in lead revenue. This drop was further compounded by decreases in advertising, services, and membership subscription revenues as the company undertook quality improvements and market optimizations.
International revenue also fell by $2.0 million, or 6%, reflecting a strategic pivot in the Canadian business model toward a self-serve platform that necessitates fewer manual sales efforts.
| May 2024 | May 2025 | |
|---|---|---|
Net Income | -27.24M | 52.74M |
Net Income to Non-controlling Interest | 618K | 530K |
Profit | -26.62M | 53.27M |
Net Income Discontinued | -10.26M | 0 |
Net Income Continuing | -16.36M | 53.25M |
Income Tax Expense | 2.02M | -15.57M |
Pretax Income | -14.35M | 37.70M |
Non-operating Income | -1.04M | -1.47M |
Operating Income | -13.31M | 39.17M |
Revenue | 1.27B | 1.12B |
Costs and Expenses | 1.28B | 1.08B |
Cost of Revenue | 33.00M | 58.09M |
Operating Expenses | 1.25B | 1.02B |
Depreciation, Depletion & Amortization | 97.31M | 74.75M |
Research & Development | 94.98M | 98.69M |
Selling, General & Administrative | 1.05B | 854.9M |
Cost and Gross Profit
The cost of revenue for the Domestic segment slightly increased by $0.4 million, or 3%, primarily due to higher hosting fees. International costs rose by $0.1 million, or 13%, but remained consistent as a percentage of revenue. Consequently, gross profit fell by $60.0 million, or 20%.
Operating Expenses
Selling and Marketing
Domestic selling and marketing expenses saw a reduction of $36.7 million, or 25%, attributed to lower compensation and advertising expenses. Internationally, these expenses decreased by $1.8 million, or 16%, primarily due to staff reductions associated with the Canadian model shift.
General and Administrative
General and administrative expenses in the Domestic segment declined significantly, down $28.3 million, or 37%. This reduction was largely driven by decreased compensation, provision for credit losses, and other operational cost savings. A notable contributor was the stock-based compensation expense tied to the forfeiture of restricted stock by Joseph Levin, the former CEO of IAC.
Product Development
Conversely, product development expenses increased by $3.3 million, or 14%, due to heightened compensation costs reflecting investments in innovation.
Operating Income and Adjusted EBITDA
Operating income showed improvement for the quarter, attributed to reductions in selling, marketing, general and administrative, and depreciation expenses. However, Domestic Adjusted EBITDA decreased by $7.7 million, or 26%, while International Adjusted EBITDA fell by $0.6 million, or 8%.
4. Share Repurchase Activity
In an effort to enhance shareholder value, Angi repurchased 0.6 million shares of its Class A Common Stock at an average price of $16.46 per share during Q1 2025. Following this, from April 1 to May 2, 2025, an additional 1.7 million shares were repurchased at an average price of $12.83 per share. As of May 2, 2025, Angi has exhausted its previous share repurchase authorization and approved a new plan for an additional 5 million shares.
5. Capital Expenditures and Liquidity
Angi's capital expenditures for 2025 are projected to increase by 15% to 25% compared to the previous year, primarily due to investments in capitalized software. The company remains confident that its existing cash reserves, along with anticipated positive cash flows, will adequately meet operational needs in the upcoming year.
| May 2024 | May 2025 | |
|---|---|---|
Total Assets | 1.83B | 1.80B |
Total Current Assets | 481.8M | 465.2M |
Cash and Equivalents | 363.3M | 386.5M |
Accounts Receivable | 60.81M | 40.47M |
Other Current Assets | 57.66M | 38.17M |
Total Non-current Assets | 1.35B | 1.34B |
Intangible Assets | 1.05B | 1.05B |
Non-current Deferred Tax Assets | 147.2M | 169.6M |
Net PP&E | 99.89M | 83.88M |
Other Non-current Assets | 50.16M | 33.17M |
Total Liabilities and Equity | 1.83B | 1.80B |
Other Equity and Liabilities | 50.43M | 41.86M |
Total Liabilities | 741.4M | 714.6M |
Total Current Liabilities | 242.2M | 216.0M |
Accounts Payable and Accrued Liabilities | 192.1M | 180.7M |
Current Deferred Revenue | 50.1M | 35.3M |
Other Current Liabilities | -16K | 41K |
Total Non-current Liabilities | 499.2M | 498.5M |
Long-term Debt | 496.2M | 497.0M |
Non-current Deferred Tax Liabilities | 3.03M | 1.53M |
Total Equity and Non-controlling Interests | 1.04B | 1.04B |
Total Equity | 1.03B | 1.04B |
Non-controlling Interests | 4.01M | 0 |
6. Conclusion
The first quarter of 2025 has been a period of mixed results for Angi Inc. While the company faces challenges with revenue declines amid strategic shifts, ongoing operational improvements and a focus on consumer engagement signal potential for long-term growth. As Angi continues to refine its business model and align with market demands, stakeholders will be keenly watching its next steps in navigating the evolving landscape of the home services industry.
