ANGI · Read the filing

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

GENERAL

Management Overview

Angi Inc. (“Angi,” the “Company,” “we,” “our,” or “us”) connects quality home professionals with consumers across more than 500 different categories, from repairing and remodeling homes to cleaning and landscaping. There were approximately 168,000 Transacting Professionals (as defined below) during the three months ended December 31, 2024. Additionally, consumers turned to at least one of our businesses to find a professional for approximately 17 million projects during the twelve months ended December 31, 2024.

The Company has three operating segments: (i) Ads and Leads; (ii) Services; and (iii) International (consisting of businesses in Europe and Canada) and operates under multiple brands including Angi, HomeAdvisor, and Handy.

Ads and Leads provides professionals the capability to engage with potential customers, including quoting and invoicing services, and provides consumers with tools and resources to help them find local, pre-screened and customer-rated professionals nationwide for home repair, maintenance and improvement projects. Services consumers can request household services directly through the Angi platform, and such requests are fulfilled by independently established home services providers engaged in a trade, occupation and/or business that customarily provides such services. Matching service, the booking of pre-priced services, and related tools and directories are provided to consumers free of charge upon registration.

The Company also owns and operates international businesses that connect consumers with home professionals. The business models of our international businesses differ in certain respects from the business models of our various domestic businesses.

The Company primarily markets its services to consumers through search engine marketing, affiliate agreements with third parties, and television advertising. The Company also markets its services to consumers through email, digital display advertisements, partnerships with other contextually related websites and, to a lesser extent, through relationships with certain

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retailers, direct mail and radio advertising. The Company markets subscription packages and time-based advertising to professionals primarily through its sales force, as well as through search engine marketing, digital media advertising, and direct relationships with trade associations and manufacturers.

Proposed Spin-off

On January 13, 2025, IAC announced that its board of directors approved a plan to spin off its full stake in the Company to IAC stockholders. IAC intends to effect the spin-off through a dividend to the holders of its common stock and Class B common stock of all of the common stock of the Company owned by IAC (the “Distribution”). Prior to the effective time of the Distribution, IAC intends to voluntarily convert all of the shares of our Class B common stock that it owns to shares of Class A common stock. The completion of the Distribution remains subject to customary conditions and to the final approval of IAC's board of directors and may not be completed, on the anticipated terms or at all. IAC expects to complete the Distribution as soon as March 31, 2025.

Total Home Roofing, LLC Sale

On November 1, 2023, Angi completed the sale of 100% of its wholly-owned subsidiary, Total Home Roofing, LLC (“THR,” which comprised its former Roofing segment), which is reflected as a discontinued operation in its financial statements. For additional details, see “Note 17—Discontinued Operations” to the consolidated financial statements included in “Item 8. Consolidated Financial Statements and Supplementary Data.”

Defined Terms and Operating Metrics:

Unless otherwise indicated or as the context otherwise requires, certain terms used in this annual report, which include the principal operating metrics we use in managing our business, are defined below:

•Ads and Leads Revenue primarily comprises domestic revenue from consumer connection revenue for consumer matches, revenue from professionals under contract for advertising and membership subscription revenue from professionals and consumers.

•Services Revenue primarily comprises domestic revenue from pre-priced offerings by which the consumer requests services through a Company platform and the Company connects them with a professional to perform the service.

•International Revenue primarily comprises revenue generated within the International segment (consisting of businesses in Europe and Canada), including consumer connection revenue for consumer matches and membership subscription revenue from professionals.

•Other primarily comprises costs for corporate initiatives, shared costs (such as executive and public company costs) and other expenses not allocated to the operating segments.

•Service Requests are (i) fully completed and submitted domestic service requests for connections with Ads and Leads professionals, (ii) contacts to Ads and Leads professionals generated via the professional directory from unique users in unique categories (such that multiple contacts from the same user in the same category in the same day are counted as one Service Request) and (iii) requests to book Services jobs in the period.

•Monetized Transactions are (i) Service Requests that are matched to a paying Ads and Leads professional in the period and (ii) completed and in-process Services jobs in the period; a single Service Request can result in multiple monetized transactions.

•Transacting Professionals (“Transacting Pros” formerly known as Transacting Service Professionals or “Transacting SPs”) are the number of (i) Ads and Leads professionals that paid for consumer matches or advertising and (ii) Services professionals that performed a Services job, during the most recent quarter.

•ANGI Group Senior Notes - On August 20, 2020, ANGI Group, LLC (“ANGI Group”), a direct wholly-owned subsidiary of the Company, issued $500.0 million of its 3.875% Senior Notes due August 15, 2028, with interest payable February 15 and August 15 of each year.

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Components of Results of Operations

Sources of Revenue

From January 1, 2020 through December 31, 2022, Services recorded revenue on a gross basis. Effective January 1, 2023, we modified the Services terms and conditions so that the professional, rather than Angi, has the contractual relationship with the consumer to deliver the service and our performance obligation to the consumer is to connect them with the professional. This change in contractual terms requires revenue to be reported as the net amount of what is received from the consumer after deducting the amounts owed to the professional providing the service effective for all arrangements entered into after December 31, 2022. There is no impact to operating loss or Adjusted EBITDA from this change in revenue recognition. For the year ended December 31, 2022, if Services revenue was recorded on a net basis, revenue would have been reduced by $242.6 million.

Cost of Revenue and Gross Profit

Cost of revenue, which excludes depreciation, consists primarily of (i) credit card processing fees, (ii) hosting fees, and (iii) payments made to independent third-party professionals who perform work contracted under Services arrangements that were entered into prior to January 1, 2023 and the change to net revenue reporting described above.

Gross profit is revenue less cost of revenue. Gross margin is gross profit expressed as a percentage of revenue.

Operating Costs and Expenses:

•Selling and marketing expense - consists primarily of (i) advertising expenditures, which include marketing fees to promote the brand to consumers and professionals with (a) online marketing, including fees paid to search engines and other online marketing platforms, partners who direct traffic to our brands, and app platforms, and (b) offline marketing, which is primarily television, streaming, and radio advertising, (ii) compensation expense (including stock-based compensation expense) and other employee-related costs for our sales and marketing personnel, (iii) service guarantee expense, (iv) software license and maintenance costs, and (v) outsourced personnel costs.

•General and administrative expense - consists primarily of (i) compensation expense (including stock-based compensation expense) and other employee-related costs for personnel engaged in executive management, finance, legal, tax, human resources and customer service functions, (ii) provision for credit losses, (iii) software license and maintenance costs, (iv) outsourced personnel costs for personnel engaged in assisting in customer service functions, (v) fees for professional services, and (vi) rent expense and facilities costs (including impairments of right-of-use assets). Our customer service function includes personnel who provide support to our professionals and consumers.

•Product development expense - consists primarily of (i) compensation expense (including stock-based compensation expense) and other employee-related costs that are not capitalized for personnel engaged in the design, development, testing and enhancement of product offerings and related technology, (ii) software license and maintenance costs, and (iii) outsourced personnel costs for personnel engaged in product development.

Non-GAAP financial measure

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) is a non-GAAP financial measure. See “Principles of Financial Reporting” for the definition of Adjusted EBITDA and required non-GAAP reconciliations.

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Results of Operations for the Years Ended December 31, 2024 and 2023

The following discussion should be read in conjunction with Item 8. Consolidated Financial Statements and Supplementary Data. For a discussion regarding our financial condition and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022, please refer to “Management's Discussion and Analysis of Financial Condition and Results of Operations” and the annual audited consolidated financial statements of the Company and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2023 filed with the Securities and Exchange Commission on February 29, 2024.

Revenue

Year Ended December 31,

(Dollars in thousands)

Domestic

Ads and Leads:

International

Percentage of Total Revenue:

International 11 % 9 %

Year Ended December 31,

(In thousands, rounding differences may occur)

Operating metrics:

Ads and Leads revenue decreased $162.3 million, or 14%, due primarily to decreases in consumer connection revenue of $174.5 million, or 22%, and membership subscription revenue of $9.2 million, or 18%, partially offset by an increase of $21.5 million, or 7%, in advertising revenue. The decrease in consumer connection revenue was driven by ongoing user-experience enhancements as well as lower sales and marketing spend, resulting in both lower Service Requests and lower acquisition of new professionals. The decrease in membership subscription revenue was primarily due to a decrease in professionals in the Angi network. The increase in advertising revenue was primarily due to an increase in advertising sold through our sales force.

Services revenue decreased $24.5 million, or 21%, due primarily to fewer Service Requests as a result of certain efforts described in Ads and Leads above. In addition, the decrease in revenue reflects the residual impact from contracts entered into prior to January 1, 2023 and recognized as gross revenue in the first quarter of 2023. Effective January 1, 2023, we modified the Services terms and conditions resulting in net revenue reporting.

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International revenue increased $13.2 million, or 11%, due primarily to a larger professional network and higher revenue per professional.

Cost of revenue

Year Ended December 31,

(Dollars in thousands)

As a percentage of revenue 5% 5%

Services cost of revenue decreased $9.3 million, or 42%, and decreased as a percentage of revenue, due primarily to a $7.9 million decrease in payments to third-party professionals primarily reflecting the residual impact from contracts entered into prior to January 1, 2023 and recognized as gross revenue in the first quarter of 2023 and lower revenue and a $1.2 million decrease in credit card processing fees attributable to lower revenue.

Ads and Leads cost of revenue increased $3.3 million, or 9%, and increased as a percentage of revenue, due primarily to higher hosting fees of $6.2 million attributable, in part, to the migration of data to a third-party computing platform, partially offset by lower credit card processing fees of $2.9 million attributable to lower revenue.

Gross profit

Year Ended December 31,

(Dollars in thousands)

Gross margin 95% 95% —%

Angi gross profit decreased $168.7 million, or 13%, due primarily to the decrease in revenue described in the revenue discussion above.

Selling and marketing expense

Year Ended December 31,

(Dollars in thousands)

As a percentage of revenue 51% 56%

Ads and Leads selling and marketing expense decreased $169.0 million, or 25%, driven by decreases of $129.9 million in advertising expense and compensation expense of $34.1 million. The decrease in advertising expense was due primarily to improved marketing efficiencies, including optimizations to matching and online bidding that resulted in fewer Service Requests but increased Monetized Transactions per Service Request and a decrease in offline media spend. The decrease in compensation expense was due primarily to a reduction in headcount.

International selling and marketing expense increased $2.8 million, or 8%, driven by an increase of $3.3 million in advertising expense due to an increase in online advertising to acquire new professionals and increase Service Requests.

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General and administrative expense

Year Ended December 31,

(Dollars in thousands)

As a percentage of revenue 27% 26%

Ads and Leads general and administrative expense decreased $31.7 million, or 15%, due primarily to decreases of $22.9 million in the provision for credit losses, $7.5 million in software license and maintenance costs, and $3.8 million in third-party wages, partially offset by an increase of $3.2 million in lease expense. The decrease in the provision for credit losses is primarily due to lower revenue and improved collection rates. The decrease in software license and maintenance costs and third-party wages are due primarily to reduced costs related to customer support services. The increase in lease expense is primarily due to impairment charges of $6.8 million of right-of-use assets (“ROU assets”) in the first half of 2024, partially offset by a gain on lease termination of $2.0 million in the second half of 2024, both related to the Company reducing its real estate footprint.

Services general and administrative expense decreased $13.2 million, or 30%, due primarily to decreases of $9.2 million in compensation expense and $3.3 million in third-party wages. The decrease in compensation expense is due primarily to a reduction in headcount. The decrease in third-party wages is due primarily to reduced costs related to customer support services.

International general and administrative expense increased $3.0 million, or 8%, due primarily to increases of $3.0 million in the provision for credit losses, $1.8 million in taxes, and $1.6 million in professional fees, partially offset by a decrease of $2.2 million in compensation expense. The increase in the provision for credit losses is due primarily to reduced collection rates and higher revenue, the increase in taxes is due primarily to digital services tax, and the increase in professional fees is due primarily to an increase in consulting costs. The decrease in compensation expense is due primarily to a reduction in headcount.

Product development expense

Year Ended December 31,

(Dollars in thousands)

As a percentage of revenue 8% 7%

Product development expense decreased 1% compared to the year ended December 31, 2023.

Depreciation

Year Ended December 31,

(Dollars in thousands)

As a percentage of revenue 7% 7%

Depreciation decreased $7.6 million, or 8%, due primarily to a reduction in depreciation of capitalized software largely as a result of assets fully depreciating in current and previous periods, partially offset by the impairment of certain leasehold improvements and furniture and equipment in connection with the reduction of our real estate footprint in 2024.

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Amortization of intangibles

Year Ended December 31,

(Dollars in thousands)

As a percentage of revenue NM 1%

Amortization of intangibles decreased $5.4 million due to all intangible assets becoming fully amortized during the year ended December 31, 2023, partially offset by an impairment charge of $2.6 million related to a certain indefinite-lived trade name at Services during the year ended December 31, 2024.

Operating income (loss)

Year Ended December 31,

(Dollars in thousands)

As a percentage of revenue 2% (2)%

________________________

NM = Not meaningful

Operating income increased from an operating loss for 2024 compared to 2023 due primarily to the factors described above in the revenue, cost of revenue, sales and marketing, general and administrative, product development, depreciation, and amortization of intangibles expense discussions.

At December 31, 2024, there was $36.5 million of unrecognized compensation cost, net of estimated forfeitures, related to all equity-based awards, which is expected to be recognized over a weighted average period of approximately 2.14 years.

Adjusted EBITDA

Year Ended December 31,

(Dollars in thousands)

As a percentage of revenue 12% 9%

See “Principles of Financial Reporting” for the definition of Adjusted EBITDA and required non-GAAP reconciliations.

Ads and Leads Adjusted EBITDA increased $33.0 million, or 22%, to $180.3 million, and increased as a percentage of revenue, driven by lower selling and marketing expense due to improved marketing efficiency and lower general and

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administrative expense due to decreases in the provision for credit losses, software license and maintenance costs, and third-party wages, partially offset by an increase in lease expense.

Services Adjusted EBITDA decreased $3.7 million, or 45%, and decreased as a percentage of revenue, driven by lower gross profit, partially offset by lower compensation costs and other operating expenses.

Other Adjusted EBITDA loss increased $5.4 million, or 11%, to $55.4 million, driven by an increase in compensation expense.

International Adjusted EBITDA increased $2.9 million, 22%, to $16.0 million, and increased as a percentage of revenue, driven by an increase in revenue and continued operating expense leverage.

Interest expense

Interest expense relates to interest on the ANGI Group Senior Notes.

For a detailed description of long-term debt, net, see “Note 6—Long-term Debt” to the consolidated financial statements included in “Item 8. Consolidated Financial Statements and Supplementary Data.”

Year Ended December 31,

(In thousands)

Interest expense was flat for the year ended December 31, 2024 compared to the year ended December 31, 2023.

Other income, net

Year Ended December 31,

(In thousands)

Other income, net in 2024 primarily includes interest income of $19.6 million.

Other income, net in 2023 primarily includes interest income of $17.1 million, partially offset by net foreign currency exchange losses of $1.2 million.

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Income tax benefit (provision)

Year Ended December 31,

(Dollars in thousands)

Effective income tax rate NM NM

In 2024, the Company recorded an income tax benefit, despite pre-tax income, due primarily to the valuation allowance

release for foreign net operating losses and research credits, partially offset by tax shortfalls generated by the vesting and exercise of stock-based awards, unbenefited foreign losses, and nondeductible executive compensation expense. Following the purchase of the remaining noncontrolling interests of a foreign subsidiary, we reorganized the related business operations, which resulted in the release of a valuation allowance for foreign net operating losses in the amount of $31.1 million as a discrete item in the third quarter because we are now forecasting the utilization of these net operating losses within the foreseeable future.

In 2023, the Company recorded an income tax provision, despite pre-tax losses, due primarily to tax shortfalls generated by the vesting and exercise of stock-based awards, nondeductible executive compensation expense, and unbenefited foreign losses, partially offset by research credits.

For further details of income tax matters, see “Note 12—Income Taxes” to the consolidated financial statements included in “Item 8. Consolidated Financial Statements and Supplementary Data.”

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PRINCIPLES OF FINANCIAL REPORTING

We report Adjusted EBITDA as a supplemental measure to U.S. generally accepted accounting principles (“GAAP”). This measure is considered our primary segment measure of profitability and one of the metrics by which we evaluate the performance of our businesses, and on which our internal budgets are based and may also impact management compensation. We believe that investors should have access to, and we are obligated to provide, the same set of tools that we use in analyzing our results. This non-GAAP measure should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. We endeavor to compensate for the limitations of the non-GAAP measure presented by providing the comparable GAAP measure with equal or greater prominence and descriptions of the reconciling items, including quantifying such items, to derive the non-GAAP measure. We encourage investors to examine the reconciling adjustments between the GAAP and non-GAAP measure, which we discuss below.

Definition of Non-GAAP Measure

Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) is defined as operating income excluding: (1) stock-based compensation expense; (2) depreciation; and (3) acquisition-related items consisting of amortization of intangible assets and impairments of goodwill and intangible assets, if applicable. We believe this measure is useful for analysts and investors as this measure allows a more meaningful comparison between our performance and that of our competitors. Adjusted EBITDA has certain limitations because it excludes the impact of these expenses.

Non-Cash Expenses That Are Excluded from Our Non-GAAP Measure

Stock-based compensation expense consists of expense associated with grants, including stock appreciation rights, restricted stock units (“RSUs”), stock options, performance-based RSUs (“PSUs”) and market-based awards. These expenses are not paid in cash and we view the economic costs of stock-based awards to be the dilution to our share base; we also include the related shares in our fully diluted shares outstanding for GAAP earnings per share using the treasury stock method. PSUs and market-based awards are included only to the extent the applicable performance or market condition(s) have been met (assuming the end of the reporting period is the end of the contingency period). The Company is currently settling all stock-based awards on a net basis and remits the required tax-withholding amounts from its current funds.

Depreciation is a non-cash expense relating to our capitalized software, leasehold improvements and equipment and is computed using the straight-line method to allocate the cost of depreciable assets to operations over their estimated useful lives, or, in the case of leasehold improvements, the lease term, if shorter.

Amortization of intangible assets and impairments of goodwill and intangible assets are non-cash expenses related primarily to acquisitions. At the time of an acquisition, the identifiable definite-lived intangible assets of the acquired company, such as professional relationships, technology, and trade names, are valued and amortized over their estimated lives. Value is also assigned to acquired indefinite-lived intangible assets, which comprise trade names and trademarks, and goodwill that are not subject to amortization. An impairment is recorded when the carrying value of an intangible asset or goodwill exceeds its fair value. We believe that intangible assets represent costs incurred by the acquired company to build value prior to acquisition and the related amortization and impairments of intangible assets or goodwill, if applicable, are not ongoing costs of doing business.

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The following tables reconcile operating income (loss) to Adjusted EBITDA for the Company's reportable segments and net earnings (loss) attributable to Angi shareholders:

(In thousands)

Earnings before income taxes 20,077

Net earnings attributable to noncontrolling interests (844)

Net earnings attributable to Angi Inc. shareholders $ 36,004

(In thousands)

Loss from continuing operations before income taxes (28,208)

Income tax provision (1,839)

Net loss from continuing operations (30,047)

Loss from discontinued operations, net of tax (10,264)

Net earnings attributable to noncontrolling interests (629)

Net loss attributable to Angi Inc. shareholders $ (40,940)

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FINANCIAL POSITION, LIQUIDITY, AND CAPITAL RESOURCES

Financial Position

(In thousands)

Cash and cash equivalents:

Long-term debt:

Less: unamortized debt issuance costs 3,160 3,953

At December 31, 2024, all of the Company’s international cash can be repatriated without significant consequences.

For a detailed description of long-term debt, see “Note 6—Long-term Debt” to the consolidated financial statements included in “Item 8. Consolidated Financial Statements and Supplementary Data.”

Cash Flow Information

In summary, the Company’s cash flows are as follows:

Year Ended December 31,

(In thousands)

Net cash provided by (used in):

Operating activities attributable to continuing operations $ 155,941 $ 94,184

Investing activities attributable to continuing operations $ (50,411) $ (46,557)

Financing activities attributable to continuing operations $ (53,759) $ (16,983)

Net cash provided by operating activities attributable to continuing operations consists of earnings adjusted for non-cash items and the effect of changes in working capital. Non-cash adjustments include depreciation, provision for credit losses, stock-based compensation expense, non-cash lease expense (including impairment of right-of-use assets), deferred income taxes, and amortization and impairment of intangibles.

2024

Adjustments to net earnings attributable to continuing operations consist primarily of $86.1 million of depreciation, $57.3 million of provision for credit losses, $34.8 million of stock-based compensation expense, $16.0 million of non-cash lease expense (including impairment of right-of-use assets), partially offset by $24.0 million of deferred income taxes. The decrease from changes in working capital consists primarily of an increase of $45.4 million in accounts receivable and decreases of $19.4 million in operating lease liabilities and $7.7 million in deferred revenue, partially offset by a decrease of $28.9 million in other assets. The increase in accounts receivable is due to timing of cash receipts. The decrease in operating lease liabilities is due to cash payments on leases net of interest accretion. The decrease in deferred revenue is due primarily to lower annual memberships, primarily at Ads and Leads. The decrease in other assets is due primarily to lower capitalized sales commissions which were impacted by a reduction in the size of the salesforce, a larger portion of sales commissions being expensed rather than capitalized in the period, and a shift to annual bonuses for roles that previously received commissions as well as a payment received related to insurance coverage for previously incurred legal fees and a decrease in prepaid hosting services.

Net cash used in investing activities attributable to continuing operations includes capital expenditures of $50.5 million primarily related to investments in capitalized software to support the Company’s products and services.

Net cash used in financing activities attributable to continuing operations includes $28.6 million for the repurchase of 12.6 million shares of the Company’s Class A common stock, on a settlement date basis, at an average price of $2.27 per share,

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$16.0 million for the purchase of the remaining noncontrolling interests of a foreign subsidiary, and $7.6 million for the payment of withholding taxes on behalf of employees for stock-based awards that were net settled.

2023

Adjustments to net loss attributable to continuing operations consist primarily of $93.6 million of depreciation, $79.4 million of provision for credit losses, $43.4 million of stock-based compensation expense, $11.9 million of non-cash lease expense, and $8.0 million of amortization of intangibles, partially offset by $10.0 million of deferred income taxes. The decrease from changes in working capital consists primarily of an increase of $58.2 million in accounts receivable, a decrease of $20.7 million in operating lease liabilities, an increase of $13.9 million of other assets, and a decrease of $8.0 million in accounts payable and other liabilities. The increase in accounts receivable is due primarily to timing of cash receipts. The decrease in operating lease liabilities is due to cash payments on leases net of interest accretion. The increase in other assets is due primarily to a $10.9 million receivable related to insurance coverage for previously incurred legal fees. The decrease in accounts payable and other liabilities is due to a decrease in accrued advertising.

Net cash used in investing activities attributable to continuing operations includes capital expenditures of $47.8 million primarily related to investments in capitalized software to support the Company’s products and services and purchases of marketable debt securities of $12.4 million, partially offset by maturities of marketable debt securities of $12.5 million and $1.0 million of proceeds for the sale of THR.

Net cash used in financing activities attributable to continuing operations includes $10.9 million for the repurchase of 4.4 million shares of the Company’s Class A common stock, on a settlement date basis, at an average price of $2.50 per share and $6.0 million for the payment of withholding taxes on behalf of employees for stock-based awards that were net settled.

Discontinued Operations

Net cash provided by discontinued operations of $11.0 million for the year ended December 31, 2023, relates to the operations of THR. The Company does not expect cash flows from discontinued operations following the sale of THR on November 1, 2023.

Liquidity and Capital Resources

Share Repurchase Authorizations and Activity

During the year ended December 31, 2024, the Company repurchased 12.5 million shares of its Class A common stock, on a trade date basis, at an average price of $2.27 per share, or $28.4 million in aggregate. During the fourth quarter of 2023, the Company announced its intent to repurchase the 14.0 million shares remaining in its stock repurchase authorization from March 2020 (the “2020 Share Authorization”). On August 2, 2024, the board of directors of the Company approved a new stock repurchase authorization of 25 million shares (the “2024 Share Authorization”). As of August 19, 2024, the Company had no shares remaining under the 2020 Authorization. From January 1, 2025 through February 7, 2025, the Company did not repurchase any additional shares. As of February 7, 2025, the Company had 23.1 million shares remaining in the 2024 Share Authorization.

The Company may repurchase shares pursuant to the 2024 Share Authorization over an indefinite period of time in the open market and in privately negotiated transactions, depending on those factors the Company’s management deems relevant at any particular time, including, without limitation, market conditions, share price and future outlook.

Contractual Obligations

The Company enters into various contractual arrangements as a part of its continued operations.Material contractual obligations described in the accompanying notes to the financial statements within “Item 8. Consolidated Financial Statements and Supplementary Data” includes operating leases as described in “Note 5—Leases,” and principal and interest payments on long-term as debt described in “Note 6—Long-term Debt.”

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The Company has material purchase obligations which represent legally binding agreements to purchase goods and services that specify all significant terms. Future payments under these agreements at December 31, 2024 are as follows:

Amount of Commitment Expiration Per Period

Less Than1 Year 1–3Years 3–5Years More Than5 Years Total

(In thousands)

Purchase obligations include $11.5 million related to technology contracts spend to be made in 2025.

Capital Expenditures

The Company’s 2025 capital expenditures are expected to be higher than 2024 capital expenditures of $50.5 million by approximately 15% to 25% due to an increase related to capitalized software.

Liquidity Assessment

The Company’s liquidity could be negatively affected by a decrease in demand for its products and services due to economic or other factors.

At December 31, 2024, IAC held 2.6 million of the Company’s outstanding Class A shares and all of the Company’s outstanding Class B shares, which represented 85.3% of the Company’s economic interest and 98.3% of the Company’s voting interest as of that date. As a result, IAC has the ability to control the Company’s financing activities, including the issuance of additional debt and equity securities by the Company or any of its subsidiaries, or the incurrence of other indebtedness generally. While the Company is expected to have the ability to access debt and equity markets if needed, such transactions may require the approval of IAC due to its control of the majority of the outstanding voting power of the Company’s capital stock and its representation on the Company’s board of directors.

On January 13, 2025, IAC and Joseph Levin, IAC’s Chief Executive Officer, entered into an Employment Transition Agreement (the “Agreement”). Pursuant to the Agreement, IAC transferred 5.0 million shares of Angi Class B common stock held by IAC to Mr. Levin. Also pursuant to the Agreement, Mr. Levin converted all shares of Class B common stock into shares of Class A common stock. As of February 7, 2025, IAC’s economic and voting interests in the Company were 84.2% and 98.1%, respectively.

The Company believes its existing cash, cash equivalents, and expected positive cash flows generated from operations will be sufficient to fund its normal operating requirements, including capital expenditures, debt service, the payment of withholding taxes paid on behalf of employees for net-settled stock-based awards, and investing and other commitments, for the next twelve months. We may elect to raise additional capital through the sale of additional equity or debt financing to fund business activities such as strategic acquisitions, share repurchases, or other purposes beyond the next twelve months.

Additional financing may not be available on terms favorable to the Company or at all, and may also be impacted by any disruptions in the financial markets. In addition, the Company’s existing indebtedness could limit its ability to obtain additional financing.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The following disclosure is provided to supplement the descriptions of the Company’s accounting policies contained in “Note 2—Summary of Significant Accounting Policies” to the consolidated financial statements included “Item 8. Consolidated Financial Statements and Supplementary Data” in regard to significant areas of judgment. Management of the Company is required to make certain estimates, judgments and assumptions during the preparation of its consolidated financial statements in accordance with GAAP. These estimates, judgments and assumptions impact the reported amount of assets, liabilities, revenue and expenses and the related disclosure of assets and liabilities. Actual results could differ from these estimates. Because of the size of the financial statement elements to which they relate, some of our accounting policies and estimates have a more significant impact on our financial statements than others. What follows is a discussion of some of our more significant accounting policies and estimates.

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Credit Losses

The Company makes judgments as to its ability to collect outstanding receivables and provides an allowance when it has determined that all or a portion of the receivable will not be collected. The Company maintains an allowance for credit losses to provide for the estimated amount of accounts receivable that will not be collected. The allowance for credit losses is based upon a number of factors, including the length of time accounts receivable are past due, the Company’s previous loss history, the specific customer’s ability to pay its obligation to the Company and any other forward-looking data regarding customers’ ability to pay that is available. The duration of time between the Company’s issuance of an invoice and payment due date is not significant. The carrying value of the credit loss allowance is $20.5 million and $24.7 million at December 31, 2024 and 2023, respectively. The provision for credit losses was $57.3 million and $79.4 million for the years ended December 31, 2024 and 2023, respectively.

Recoverability of Goodwill and Indefinite-Lived Intangible Assets

The carrying value of goodwill is $883.4 million and $886.0 million at December 31, 2024 and 2023, respectively. Indefinite-lived intangible assets, which consist of the Company’s acquired trade names and trademarks, have a carrying value of $167.7 million and $170.8 million at December 31, 2024 and 2023, respectively.

Goodwill and indefinite-lived intangible assets are assessed annually for impairment as of October 1, or more frequently if an event occurs or circumstances change that would indicate that it is more likely than not that the fair value of a reporting unit or the fair value of an indefinite-lived intangible asset has declined below its carrying value. In performing its annual goodwill impairment assessment, the Company has the option under GAAP to qualitatively assess whether it is more likely than not that the fair value of a reporting unit is less than its carrying value; if the conclusion of the qualitative assessment is that there are no indicators of impairment, the Company does not perform a quantitative test, which would require a valuation of the reporting unit, as of October 1. GAAP provides a not all-inclusive set of examples of macroeconomic, industry, market and company specific factors for entities to consider in performing the qualitative assessment described above; management considers the factors it deems relevant in making its more likely than not assessments. While the Company also has the option under GAAP to qualitatively assess whether it is more likely than not that the fair values of its indefinite-lived intangible assets are less than their carrying values, the Company’s policy is to determine the fair value of each of its indefinite-lived intangible assets annually as of October 1, in part, because the level of effort required to perform the quantitative and qualitative assessments is essentially equivalent.

If the conclusion of our qualitative assessment is that there are indicators of impairment and a quantitative test is required, the annual or interim quantitative test of the recovery of goodwill involves a comparison of the estimated fair value of the Company’s reporting unit that is being tested to its carrying value. If the estimated fair value of a reporting unit exceeds its carrying value, goodwill of the reporting unit is not impaired. If the carrying value of a reporting unit exceeds its estimated fair value, a goodwill impairment equal to the excess is recorded.

The Company’s annual assessment of the recovery of goodwill begins with management’s reassessment of its operating segments and reporting units. A reporting unit is an operating segment or one level below an operating segment, which is referred to as a component. This reassessment of reporting units is also made each time the Company changes its operating segments to the extent that this also results in a change in reporting units. If the goodwill of a reporting unit is allocated to newly formed reporting units, the allocation is usually made to each reporting unit based upon their relative fair values.

For the Company’s annual goodwill test as of October 1, 2024, the Company performed a qualitative assessment of the International reporting unit to evaluate whether it is more likely than not that the fair value of this reporting unit was in excess of its carrying value.

The primary factors that the Company considered in its qualitative assessment for the International reporting unit at October 1, 2024 are described below:

•The Company considered the strong forecasted operating performance, in addition to actual operating results in the current year, of the International reporting unit.

•The Company prepared a valuation of the International reporting unit primarily in connection with the issuance and/or settlement of equity awards that are denominated in the equity of this business as of June 30, 2024. This valuation was prepared time proximate to, however, not as of October 1, 2024. The fair value of the International reporting unit was in excess of its October 1, 2024 carrying value.

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For the Company’s annual goodwill test at October 1, 2024, the Company quantitatively tested the Ads and Leads and Services reporting units.The Company’s quantitative tests resulted in no impairments.

Given the decline in the Company’s stock price after October 1, 2024, the Company subsequently quantitatively tested all reporting units with goodwill as of December 31, 2024, and no impairments were noted.

The October 1, 2023 annual assessment of goodwill did not identify any impairments.

The fair value of the Company's reporting units is determined using both an income approach based on discounted cash flows (“DCF”) and a market approach when it tests goodwill for impairment, either on an interim basis or annual basis as of October 1 each year. Determining fair value using a DCF analysis requires the exercise of significant judgment with respect to several items, including the amount and timing of expected future cash flows and appropriate discount rates. The expected cash flows used in the DCF analyses are based on the Company’s most recent forecast and budget and, for years beyond the budget, the Company’s estimates, which are based, in part, on forecasted growth rates. The discount rates used in the DCF analyses are intended to reflect the risks inherent in the expected future cash flows of the respective reporting units. Assumptions used in the DCF analyses, including the discount rate, are assessed based on the reporting units' current results and forecasted future performance, as well as macroeconomic and industry specific factors. The discount rates used in the quantitative tests as of December 31, 2024 for determining the fair value of the Company’s Ads and Leads, Services, and International reporting units were 13%, 14%, and 15%, respectively. The discount rates used in the quantitative tests as of October 1, 2024 for determining the fair value of the Company’s Ads and Leads and Services reporting units were 12.5% and 13.5%, respectively. Determining fair value using a market approach considers multiples of financial metrics based on both acquisitions and trading multiples of a selected peer group of companies. From the comparable companies, a representative market multiple is determined which is applied to financial metrics to estimate the fair value of a reporting unit. To determine a peer group of companies for our respective reporting units, we considered companies relevant in terms of consumer use, monetization model, margin and growth characteristics, and brand strength operating in their respective sectors.

As a result of the valuation process, we determined that the fair value of the Ads and Leads and Services reporting units exceeded the carrying value and thus there was no impairment of goodwill in 2024. The fair value based on the valuation exceeded the carrying value of the Ads and Leads and Services reporting units by $494.5 million and $20.0 million, respectively, as of December 31, 2024.

The Company determines the fair value of indefinite-lived intangible assets using an avoided royalty DCF valuation analysis. Significant judgments inherent in this analysis include the selection of appropriate royalty and discount rates and estimating the amount and timing of expected future cash flows. The discount rates used in the DCF analyses are intended to reflect the risks inherent in the expected future cash flows generated by the respective intangible assets. The royalty rates used in the DCF analyses are based upon an estimate of the royalty rates that a market participant would pay to license the Company’s trade names and trademarks. The future cash flows are based on the Company's most recent forecast and budget and, for years beyond the budget, the Company’s estimates, which are based, in part, on forecasted growth rates. Assumptions used in the avoided royalty DCF analyses, including the discount rate and royalty rate, are assessed annually based on the actual and projected cash flows related to the asset, as well as macroeconomic and industry specific factors. The discount rates used in the Company’s annual indefinite-lived impairment assessment ranged from 12.5% to 14.5% in 2024 and 15% to 17% in 2023, and the royalty rates used ranged from 2.5% to 4.5% in both 2024 and 2023.

In the fourth quarter of 2024, the Company identified an impairment charge of $2.6 million related to a certain indefinite-lived trade name at Services. The discount rate used to value this trade name was 14.0%, and the royalty rate was 2.5%. The impairment of the indefinite-lived intangible asset is included in “Amortization of intangibles” in the statement of operations.

The October 1, 2023 annual assessment of indefinite-lived intangible assets did not identify any impairments.

Software Development Costs

We capitalize internally developed software costs (including employee payroll costs, stock-based compensation and benefit costs as well as third party production costs) subsequent to identifying technological feasibility of the software project. Significant management judgement is required in assessing when technological feasibility is established.

Depreciation of internally developed software commences when the software is available for release for its intended use and is recorded on a straight-line basis over the estimated useful life of the software, which is typically 2-3 years. The net carrying value of capitalized software is $73.1 million and $92.3 million at December 31, 2024 and 2023, respectively.

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Income Taxes

The Company is included within IAC’s tax group for purposes of federal and consolidated state income tax return filings. In all periods presented, the income tax benefit and/or provision has been computed for the Company on an as if standalone, separate return basis and payments to and refunds from IAC for the Company’s share of IAC’s consolidated federal and state tax return liabilities/receivables calculated on this basis have been reflected within cash flows from operating activities in the statement of cash flows. The tax sharing agreement between the Company and IAC governs the parties’ respective rights, responsibilities and obligations with respect to tax matters, including responsibility for taxes attributable to the Company, entitlement to refunds, allocation of tax attributes and other matters and, therefore, ultimately governs the amount payable to or receivable from IAC with respect to income taxes. Any differences between taxes currently payable to or receivable from IAC under the tax sharing agreement and the current tax provision or benefit computed on an as if standalone, separate return basis for GAAP are reflected as adjustments to additional paid-in capital in the statement of shareholders’ equity and financing activities within the statement of cash flows. The portion of the December 31, 2024 deferred tax assets that will be payable to IAC pursuant to the tax sharing agreement, upon realization, is $87.3 million.

The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation allowance is provided if it is determined that it is more likely than not that the deferred tax asset will not be realized. At December 31, 2024 and 2023, the balance of the Company’s net deferred tax asset is $167.6 million and $145.4 million, respectively.

The Company evaluates and accounts for uncertain tax positions using a two-step approach. Recognition (step one) occurs when the Company concludes that a tax position, based solely on its technical merits, is more-likely-than-not to be sustainable upon examination. Measurement (step two) determines the amount of benefit that is greater than 50% likely to be realized upon ultimate settlement with a taxing authority that has full knowledge of all relevant information. De-recognition of a tax position that was previously recognized would occur when the Company subsequently determines that a tax position no longer meets the more-likely-than-not threshold of being sustained. This measurement step is inherently difficult and requires subjective estimations of such amounts to determine the probability of various possible outcomes. At December 31, 2024 and 2023, the Company has unrecognized tax benefits, including interest, of $9.7 million and $8.1 million, respectively. We consider many factors when evaluating and estimating our tax positions and unrecognized tax benefits, which may require periodic adjustment and which may not accurately anticipate actual outcomes. Although management currently believes changes to unrecognized tax benefits from period to period and differences between amounts paid, if any, upon resolution of issues raised in audits and amounts previously provided will not have a material impact on the liquidity, results of operations, or financial condition of the Company, these matters are subject to inherent uncertainties and management’s view of these matters may change in the future.

The ultimate amount of deferred income tax assets realized and the amounts paid for deferred income tax liabilities and unrecognized tax benefits may vary from our estimates due to future changes in income tax law, state income tax apportionment or the outcome of any review of our tax returns by the various tax authorities, as well as actual operating results of the Company that vary significantly from anticipated results.

The Company regularly assesses the realizability of deferred tax assets considering all available evidence including, to the extent applicable, the nature, frequency and severity of prior cumulative losses, forecasts of future taxable income, tax filing status, the duration of statutory carryforward periods, available tax planning and historical experience. As of December 31, 2024, the Company is in a three-year cumulative loss position. The Company’s most significant net deferred tax asset that could expire relates to U.S. federal net operating loss (“NOL”) carryforwards of $72.6 million. The Company expects to generate sufficient future taxable income of at least $345.9 million prior to the expiration of these NOLs, the majority of which expire between 2035 and 2037, to fully realize this deferred tax asset.

Stock-Based Compensation

Stock-based compensation at the Company is inherently complex. Our desire is to attract, retain, incentivize and reward our management team and employees at the Company by allowing them to benefit directly from the value they help to create. We accomplish these objectives, in part, by issuing equity awards denominated in the equity of Angi or in the equity of one of our subsidiaries. We further refine this approach by tailoring certain equity awards to the applicable circumstances. For example, we issue certain equity awards for which vesting is linked to the achievement of a performance target such as revenue or profits; these awards are referred to as PSUs. In other cases, we link the vesting of equity awards to the achievement of a value target for a subsidiary or Angi’s stock price, as applicable; these awards are referred to as market-based awards (“MSUs”). The nature

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and variety of these types of equity-based awards creates complexity in our determination of stock-based compensation expense.

Business combinations may result in the modification of equity awards, which may create additional complexity and additional stock-based compensation expense. Also, our internal reorganizations can also lead to modifications of equity awards and may result in additional complexity and stock-based compensation expense.

Finally, the means by which we settle our equity-based awards also introduces complexity into our financial reporting. We provide a path to liquidity by settling the subsidiary denominated awards in IAC or Angi shares. In addition, certain former Angi stock appreciation rights can be settled in IAC or Angi awards at IAC’s election. These features increase the complexity of our earnings per share calculations.

Stock-based compensation expense reflected in our statements of operations includes expense related to the Company’s RSU awards, including MSUs and PSUs, stock options, stock appreciation rights, equity instruments denominated in shares of one of our subsidiaries, and an allocation of expense related to IAC denominated restricted stock.

The Company recorded stock-based compensation expense of $34.8 million and $43.4 million for the years ended December 31, 2024 and 2023, respectively.

The Company issues RSUs, PSUs and MSUs. For RSUs, the value of the instrument is measured at the grant date as the fair value of the underlying Angi’s common stock and expensed as stock-based compensation expense over the vesting term. For PSUs, the value of the instrument is measured at the grant date as the fair value of the underlying Angi’s common stock and expensed as stock-based compensation over the vesting term when the performance targets are considered probable of being achieved. For MSUs, a lattice model is used to estimate the value of the awards. The Company also issues stock options and stock appreciation rights. The Company estimates the fair value of newly granted or modified stock appreciation rights and stock options, including equity instruments denominated in shares of one of our subsidiaries, using the Black-Scholes option-pricing model. The Black-Scholes option-pricing model requires the use of highly subjective and complex assumptions, the most significant of which include expected term, expected volatility of the underlying shares, risk-free interest rates and the expected dividend yield. In addition, the recognition of stock-based compensation expense is impacted by our estimated forfeiture rates, which are based, in part, on historical forfeiture rates. For stock appreciation rights and stock options, including equity instruments denominated in shares of one of our subsidiaries, the grant date fair value of the award is recognized as an expense on a straight-line basis, net of estimated forfeitures, over the requisite service period, which is the vesting period of the award.

Recent Accounting Pronouncements

For a discussion of recent accounting pronouncements, see “Note 2—Summary of Significant Accounting Policies” to the consolidated financial statements included in “Item 8. Consolidated Financial Statements and Supplementary Data.”

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

The Company’s exposure to market risk for changes in interest rates relates primarily to the Company’s long-term debt.

At December 31, 2024, the principal amount of the Company’s outstanding debt comprises $500.0 million of ANGI Group Senior Notes, which bear interest at a fixed rate. If market rates decline relative to interest rates on the ANGI Group Senior Notes, the Company runs the risk that the related required interest payments will exceed those based on market rates. A 100-basis point increase or decrease in the level of interest rates would, respectively, decrease or increase the fair value of the fixed-rate debt by $16.1 million. Such potential increase or decrease in fair value is based on certain simplifying assumptions, including an immediate increase or decrease in the level of interest rates with no other subsequent changes for the remainder of the period, nor changes in the credit profile.

Foreign Currency Exchange Risk

The Company has operations in certain foreign markets, primarily in various jurisdictions within the European Union, the United Kingdom, and Canada. The Company has exposure to foreign currency exchange risk related to its foreign subsidiaries that transact business in a functional currency other than the U.S. dollar. As a result, as foreign currency exchange rates

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fluctuate, the translation of the statement of operations of the Company’s international businesses into U.S. dollars affects year-over-year comparability of operating results.

In addition, certain of the Company’s U.S. operations have customers in international markets. International revenue, including revenue of our operations located outside the U.S., which is measured based upon where the customer is located, accounted for 11% and 9% for the years ended December 31, 2024 and 2023, respectively.

The Company is also exposed to foreign currency transaction gains and losses to the extent it or its subsidiaries conduct transactions in and/or have assets and/or liabilities that are denominated in a currency other than the entity’s functional currency. The Company recorded foreign exchange (losses) and gains of $(0.7) million and $1.2 million for the year ended December 31, 2024 and 2023, respectively.

The Company’s exposure to foreign currency exchange gains or losses have not been material to the Company; therefore, the Company has not hedged its foreign currency exposures. Any growth and expansion of our international operations increases our exposure to foreign exchange rate fluctuations. Significant foreign exchange rate fluctuations, in the case of one currency or collectively with other currencies, could have a significant impact on our future results of operations.

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Item 8. Consolidated Financial Statements and Supplementary Data

Report of Independent Registered Public Accounting Firm

To the Shareholders and the Board of Directors of Angi Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Angi Inc. and subsidiaries(the Company) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive operations, shareholders' equity and cash flows for each of the three years in the period ended December 31, 2024, and the related notesand financial statement schedule listed in the Index at Item 15(a)(2)(collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 28, 2025 expressed an unqualified opinion thereon.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

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Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

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Valuation of Goodwill

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2017.

New York, New York

February 28, 2025

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ANGI INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

December 31,

(In thousands, except par value amounts)

ASSETS

Capitalized software, leasehold improvements and equipment, net 79,564 109,527

LIABILITIES AND SHAREHOLDERS’ EQUITY

LIABILITIES:

Accrued expenses and other current liabilities 171,351 179,329

Commitments and contingencies

SHAREHOLDERS’ EQUITY:

Accumulated other comprehensive (loss) income (2,495) 1,187

Noncontrolling interests — 3,741

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF OPERATIONS

Year Ended December 31,

(In thousands, except per share data)

Operating costs and expenses:

Loss from discontinued operations, net of tax — (10,264) (38,814)

Net earnings attributable to noncontrolling interests (844) (629) (468)

Per share information from continuing operations:

Basic earnings (loss) per share $ 0.07 $ (0.06) $ (0.18)

Diluted earnings (loss) per share $ 0.07 $ (0.06) $ (0.18)

Per share information attributable to Angi Inc. shareholders:

Basic earnings (loss) per share $ 0.07 $ (0.08) $ (0.26)

Diluted earnings (loss) per share $ 0.07 $ (0.08) $ (0.26)

Stock-based compensation expense by function:

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE OPERATIONS

Year Ended December 31,

(In thousands)

Other comprehensive (loss) income:

Change in foreign currency translation adjustment (3,544) 2,501 (5,028)

Net earnings attributable to noncontrolling interests (844) (629) (468)

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY

Accumulated Other Comprehensive Income (Loss) TotalShareholders’Equity

$ Shares $ Shares $ Shares

(In thousands)

Purchase of treasury stock — — — — — — — — — (8,144) (8,144) — (8,144)

Other — — — — — — (4) — — — (4) — (4)

Other — — — — — — (37) — — — (37) (24) (61)

Other comprehensive (loss) income — — — — — — — — (3,682) — (3,682) 138 (3,544)

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

ANGI INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

Year Ended December 31,

(In thousands)

Cash flows from operating activities attributable to continuing operations:

Loss from discontinued operations, net of tax — (10,264) (38,814)

Changes in assets and liabilities, net of effects of dispositions:

Cash flows from investing activities attributable to continuing operations:

Purchases of marketable debt securities — (12,362) —

Proceeds from maturities of marketable debt securities — 12,500 —

Net proceeds from the sale of a business — 1,000 —

Proceeds from sales of fixed assets 81 85 162

Cash flows from financing activities attributable to continuing operations:

Purchase of noncontrolling interests (16,019) — —

Distribution to IAC pursuant to the tax sharing agreement (1,548) — —

Total cash provided by (used in) continuing operations 51,771 30,644 (86,142)

Total cash provided by (used in) discontinued operations — 10,986 (20,102)

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

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ANGI INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1—ORGANIZATION

Nature of Operations

Angi Inc. connects quality home professionals with consumers across more than 500 different categories, from repairing and remodeling homes to cleaning and landscaping. Approximately 168,000 transacting professionals actively sought consumer matches, completed jobs, or advertised work through Angi Inc. platforms during the three months ended December 31, 2024. Additionally, consumers turned to at least one of our businesses to find a professional for approximately 17 million projects during the year ended December 31, 2024.

Ads and Leads provides professionals the capability to engage with potential customers, including quoting and invoicing services, and provides consumers with tools and resources to help them find local, pre-screened and customer-rated professionals nationwide for home repair, maintenance and improvement projects. Services consumers can request household services directly through the Angi platform, and such requests are fulfilled by independently established home services providers engaged in a trade, occupation and/or business that customarily provides such services. Matching service, booking of pre-priced services, and related tools and directories are provided to consumers free of charge upon registration.

As used herein, “Angi,” the “Company,” “we,” “our,” “us,” and similar terms refer to Angi Inc. and its subsidiaries (unless the context requires otherwise).

At December 31, 2024, IAC Inc. (“IAC”) owned 85.3% and 98.3% of the economic and voting interests, respectively, of the Company.

Total Home Roofing, LLC Sale

On November 1, 2023, Angi completed the sale of 100% of its wholly-owned subsidiary, Total Home Roofing, LLC (“THR,” which comprised its former Roofing segment), and which is reflected as a discontinued operation in its financial statements. See “Note 17—Discontinued Operations” for additional details.

NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation and Consolidation

The Company prepares its consolidated financial statements (referred to herein as “financial statements”) in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”). The financial statements include all accounts of the Company, all entities that are wholly-owned by the Company and all entities in which the Company has a controlling financial interest. All intercompany transactions and balances between entities comprising the Company have been eliminated.

In the opinion of management, the assumptions underlying the historical financial statements, including the basis on which the expenses have been allocated from IAC, are reasonable. However, the allocations may not reflect all of the expenses that Angi may have incurred as a standalone public company for the periods presented.

See “Note 16—Related Party Transactions with IAC” and “Note 18—Subsequent Events” for information on transactions between Angi and IAC.

Accounting Estimates

Management of the Company is required to make certain estimates, judgments and assumptions during the preparation of its financial statements in accordance with GAAP. These estimates, judgments and assumptions affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from these estimates.

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ANGI INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

On an ongoing basis, the Company evaluates its estimates and judgments, including those related to: the fair values of cash equivalents; the carrying value of accounts receivable, including the determination of the allowance for credit losses; the determination of the customer relationship period for certain costs to obtain a contract with a customer; the recoverability of all long-lived assets, including goodwill and indefinite-lived intangible assets; contingencies; unrecognized tax benefits; the liability for potential refunds and customer credits; the valuation allowance for deferred income tax assets; and the fair value of and forfeiture rates for stock-based awards, among others. The Company bases its estimates and judgments on historical experience, its forecasts and budgets, and other factors that the Company considers relevant.

Revenue Recognition

The Company accounts for a contract with a customer when it has approval and commitment from all authorized parties, the rights of the parties and payment terms are identified, the contract has commercial substance and collectability of consideration is probable. Revenue is recognized when control of the promised services or goods is transferred to the Company’s customers and in an amount that reflects the consideration the Company expects to be entitled to in exchange for those services or goods.

The Company’s disaggregated revenue disclosures are presented in “Note 9—Segment Information.”

Ads and Leads

Ads and Leads revenue includes consumer connection revenue, which comprises fees paid by professionals for consumer matches (regardless of whether the professional ultimately provides the requested service), revenue from professionals under contract for advertising, membership subscription revenue from professionals and consumers, and revenue from other services. Consumer connection revenue varies based upon several factors, including the service requested, product experience offered, and geographic location of service. Consumer connection revenue is generally billed one week following a consumer match, with payment due upon receipt of invoice. The Company maintains a liability for potential credits issued to professionals. Angi professionals generally pay for advertisements in advance on a monthly or annual basis at the option of the professional, with the average advertising contract term being approximately one year. Angi website, mobile and call center advertising revenue is recognized ratably over the contract term. Revenue from the sale of advertising in the Angie’s List Magazine is recognized in the period in which the publication is distributed. Professional membership subscription revenue is initially deferred upon receipt of payment and is recognized using the straight-line method over the applicable subscription period, which is typically one year. Angi prepaid consumer membership subscription fees are recognized as revenue using the straight-line method over the term of the applicable subscription period, which is typically one year.

Services

Services revenue primarily reflects domestic revenue from pre-priced offerings by which the consumer requests services through the Company’s platform and the Company engages a professional to perform the service. Consumers are billed when a job is started through the Services platform. Billing practices are governed by the contract terms of each project as negotiated with the consumer. Billings do not necessarily correlate with revenue recognized over time as this is based on the timing of when the consumer receives the promised services.

From January 1, 2020 through December 31, 2022, Services recorded revenue on a gross basis. Effective January 1, 2023, Angi modified the Services terms and conditions so that the professional, rather than Angi, has the contractual relationship with the consumer to deliver the service and our performance obligation to the consumer is to connect them with the professional. This change in contractual terms requires revenue to be reported as the net amount of what is received from the consumer after deducting the amounts owed to the professional providing the service effective for all arrangements entered into after December 31, 2022. There is no impact to operating loss or Adjusted EBITDA from this change in revenue recognition. For the year ended December 31, 2022, if Services revenue were recorded on a net basis, revenue would have been reduced by $242.6 million.

International

International revenue primarily comprises consumer connection revenue for matches between consumers and professionals and membership subscription revenue from professionals.

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ANGI INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Transaction Price

The objective of determining the transaction price is to estimate the amount of consideration the Company is due in exchange for its services or goods, including amounts that are variable. Contracts may include sales incentives, such as rebates, which are accounted for as variable consideration when estimating the transaction price. The Company also maintains a liability for potential future refunds and customer credits, which is recorded as a reduction of revenue. All estimates of variable consideration are based upon historical experience and customer trends. The Company determines the total transaction price, including an estimate of any variable consideration, at contract inception and reassesses this estimate each reporting period.

The Company excludes from the measurement of transaction price all taxes assessed by governmental authorities that are both (i) imposed on and concurrent with a specific revenue-producing transaction and (ii) collected from customers. Accordingly, such tax amounts are not included as a component of revenue or cost of revenue.

Arrangements with Multiple Performance Obligations

The Company’s contracts with customers may include multiple performance obligations. For such arrangements, the Company allocates revenue to each performance obligation based on its relative standalone selling price. The Company determines standalone selling prices based on the prices charged to customers, which are directly observable or an estimate if not directly observable.

Practical Expedients and Exemptions

For contracts that have an original duration of one year or less, the Company uses the practical expedient available under Accounting Standards Codification (“ASC”) Topic 606 (“ASC 606”), Revenue from Contracts with Customers, applicable to such contracts and does not consider the time value of money.

In addition, as permitted under the practical expedient available under ASC 606, the Company does not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, (ii) contracts with variable consideration that is allocated entirely to unsatisfied performance obligations or to a wholly unsatisfied promise accounted for under the series guidance, and (iii) contracts for which the Company recognizes revenue at the amount which it has the right to invoice for services performed.

The Company also applies the practical expedient to expense sales commissions as incurred where the anticipated customer relationship period is one year or less as noted below.

Costs to Obtain a Contract with a Customer

The Company has determined that commissions paid to employees pursuant to certain sales incentive programs, meet the requirements to be capitalized as a cost of obtaining a contract. Capitalized sales commissions are amortized over the estimated customer relationship period and are included in “Selling and marketing expense” in the statement of operations. The Company calculates the anticipated customer relationship period as the average customer life, which is based on historical data. When customer renewals are expected and the renewal commission is not commensurate with the initial commission, the average customer life includes renewal periods. For sales incentive programs where the anticipated customer relationship period is one year or less, the Company has elected the practical expedient to expense the costs as incurred.

Beginning October 1, 2022, commissions earned on certain transactions within the Ads and Leads segment were expensed as incurred after determining the related customer relationship was less than one year.

The following table presents the capitalized sales commissions balances and balance sheet classification at the balance sheet dates:

(In thousands)

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

During the years ended December 31, 2024 and 2023, the Company recognized expense of $52.4 million and $61.4 million, respectively, related to the amortization of these capitalized costs.

Accounts Receivable, Net of the Allowance for Credit Losses

Accounts receivable include amounts billed and currently due from customers. The allowance for credit losses is based upon a number of factors, including the length of time accounts receivable are past due, the Company’s previous loss history, the specific customer’s ability to pay its obligation and any other forward-looking data regarding customers’ ability to pay that is available. The time between the Company’s issuance of an invoice and payment due date is not significant; customer payments that are not collected in advance of the transfer of promised services or goods are generally due no later than 30 days from the invoice date.

Deferred Revenue

Deferred revenue consists of payments that are received or are contractually due in advance of the Company’s performance obligation. The Company’s deferred revenue is reported on a contract-by-contract basis at the end of each reporting period. The Company classifies deferred revenue as current when the remaining term or expected completion of its performance obligation is one year or less. At December 31, 2023, the current and non-current deferred revenue balances were $49.9 million and $0.1 million, respectively, and during the year ended December 31, 2024, the Company recognized $45.4 million that was included in the deferred revenue balance as of December 31, 2023. At December 31, 2022, the current and non-current deferred revenue balances were $50.1 million and $0.1 million, respectively, and during the year ended December 31, 2023, the Company recognized $48.0 million of revenue that was included in the deferred revenue balance at December 31, 2022. The current and non-current deferred revenue balances at December 31, 2024 are $42.0 million and less than $0.1 million, respectively. Non-current deferred revenue is included in “Other long-term liabilities” in the balance sheet.

Fair Value Measurements

The Company categorizes its financial instruments measured at fair value into a fair value hierarchy that prioritizes the inputs used in pricing the asset or liability. The three levels of the fair value hierarchy are:

•Level 1: Observable inputs obtained from independent sources, such as quoted market prices for identical assets and liabilities in active markets.

•Level 2: Other inputs, which are observable directly or indirectly, such as quoted market prices for similar assets or liabilities in active markets, quoted market prices for identical or similar assets or liabilities in markets that are not active and inputs that are derived principally from or corroborated by observable market data. The fair values of the Company’s Level 2 financial assets are primarily obtained from observable market prices for identical underlying securities that may not be actively traded. Certain of these securities may have different market prices from multiple market data sources, in which case an average market price is used.

•Level 3: Unobservable inputs for which there is little or no market data and require the Company to develop its own assumptions, based on the best information available in the circumstances, about the assumptions market participants would use in pricing the assets or liabilities.

The Company’s non-financial assets, such as goodwill, intangible assets, right-of-use assets (“ROU assets”), capitalized software, leasehold improvements and equipment are adjusted to fair value only when an impairment is recognized. Such fair value measurements are based predominantly on Level 3 inputs. Refer to “Goodwill and Indefinite-Lived Intangible Assets” and “Long-Lived Assets” below for a description of impairment charges.

Cash and Cash Equivalents

Cash and cash equivalents include cash and short-term investments, with maturities of less than 91 days from the date of purchase. Domestically, cash equivalents consist of AAA rated government money market funds, treasury bills, and time deposits. Internationally, there are $0.6 million in cash equivalents at December 31, 2024 and no cash equivalents at December 31, 2023.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Investments in Marketable Debt Securities

At times, the Company invests in marketable debt securities with active secondary or resale markets to ensure portfolio liquidity to fund current operations or satisfy other cash requirements as needed. Marketable debt securities are adjusted to fair value each quarter, and the unrealized gains and losses, net of tax, are included in accumulated other comprehensive (loss) income as a separate component of shareholders’ equity. The specific-identification method is used to determine the cost of debt securities sold and the amount of unrealized gains and losses reclassified out of accumulated other comprehensive (loss) income into earnings. The Company reviews its debt securities for impairment, including from risk of credit loss, each reporting period. The Company recognizes an unrealized loss on debt securities in net earnings (loss) when the impairment is determined to be other-than-temporary. Factors the Company considers in making such determination include the duration, severity and reason for the decline in value and the potential recovery and our intent to sell the debt security. The Company also considers whether it will be required to sell the security before recovery of its amortized cost basis and whether the amortized cost basis cannot be recovered because of credit losses. If an impairment is considered to be other-than-temporary, the debt security will be written down to its fair value and the loss will be recognized within other income, net. The Company held zero marketable debt securities at December 31, 2024 and 2023.

Capitalized Software, Leasehold Improvements and Equipment

Capitalized software, leasehold improvements and equipment, including significant improvements, are recorded at cost or at fair value to the extent acquired in a business combination. Repairs and maintenance costs are expensed as incurred. Amortization of leasehold improvements, which is included in “Depreciation” in the statement of operations, and depreciation are computed using the straight-line method over the estimated useful lives of the assets, or, in the case of leasehold improvements, the lease term, if shorter.

Asset Category EstimatedUseful Lives

Capitalized software and computer equipment 2 to 3 Years

Furniture and other equipment 5 to 7 Years

Leasehold improvements 5 to 25 Years

The Company capitalizes certain internal use software costs including external direct costs utilized in developing or obtaining the software and compensation for personnel directly associated with the development of the software. Capitalization of such costs begins when the preliminary project stage is complete and ceases when the project is substantially complete and ready for its intended purpose. The net book value of capitalized internal use software was $73.1 million and $92.3 million at December 31, 2024 and 2023, respectively.

Business Combinations

The purchase price of an acquisition is attributed to the assets acquired and liabilities assumed based on their fair values at the date of acquisition, including identifiable intangible assets that either arise from a contractual or legal right or are separable from goodwill. The Company usually obtains the assistance of outside valuation experts in the allocation of purchase price to the identifiable intangible assets acquired. While outside valuation experts may be used, management has the ultimate responsibility for the valuation methods, models and inputs used and the resulting purchase price allocation. The excess purchase price over the value of net tangible and identifiable intangible assets acquired is recorded as goodwill and is assigned to the reporting unit(s) that is expected to benefit from the business combination as of the acquisition date.

Goodwill and Indefinite-Lived Intangible Assets

The Company’s Ads and Leads, Services and International are separate operating segments and reporting units. See “Note 9—Segment Information” for additional information regarding the Company’s method of determining operating and reportable segments.

The Company assesses goodwill and indefinite-lived intangible assets for impairment annually as of October 1, or more frequently if an event occurs or circumstances change that would indicate that it is more likely than not that the fair value of a reporting unit or the fair value of an indefinite-lived intangible asset has declined below its carrying value.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

When the Company elects to perform a qualitative assessment and concludes it is not more likely than not that the fair value of the reporting unit is less than its carrying value, no further assessment of that reporting unit’s goodwill is necessary; otherwise, a quantitative assessment is performed and the fair value of the reporting unit is determined. If the carrying value of the reporting unit exceeds its estimated fair value, a goodwill impairment equal to the excess is recorded.

The primary factors that the Company considered in its qualitative assessment for the International reporting unit at October 1, 2024 are described below:

•The Company considered the strong forecasted operating performance, in addition to actual operating results in the current year, of the International reporting unit.

The October 1, 2023 annual assessment of goodwill did not identify any impairments.

While the Company has the option to qualitatively assess whether it is more likely than not that the fair values of its indefinite-lived intangible assets are less than their carrying values, the Company's policy is to determine the fair value of each of its indefinite-lived intangible assets annually as of October 1, in part, because the level of effort required to perform the quantitative and qualitative assessments is essentially equivalent. The Company determines the fair value of indefinite-lived intangible assets using an avoided royalty DCF valuation analysis. Significant judgments inherent in this analysis include the

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

selection of appropriate royalty and discount rates and estimating the amount and timing of expected future cash flows. The discount rates used in the DCF analyses are intended to reflect the risks inherent in the expected future cash flows generated by the respective intangible assets. The royalty rates used in the DCF analyses are based upon an estimate of the royalty rates that a market participant would pay to license the Company’s trade names and trademarks. The future cash flows are based on the Company's most recent forecast and budget and, for years beyond the budget, the Company’s estimates, which are based, in part, on forecasted growth rates. Assumptions used in the avoided royalty DCF analyses, including the discount rate and royalty rate, are assessed annually based on the actual and projected cash flows related to the asset, as well as macroeconomic and industry specific factors. The discount rates used in the Company’s annual indefinite-lived impairment assessment ranged from 12.5% to 14.5% in 2024 and 15% to 17% in 2023, and the royalty rates used ranged from 2.5% to 4.5% in both 2024 and 2023.

The October 1, 2023 annual assessment of indefinite-lived intangible assets did not identify any impairments.

Long-Lived Assets

Long-lived assets, other than goodwill and indefinite-lived intangible assets, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The carrying value of a long-lived asset is not recoverable if it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value is deemed not to be recoverable, an impairment loss is recorded equal to the amount by which the carrying value of the long-lived asset exceeds its fair value.

Advertising Costs

Advertising costs are expensed in the period incurred (when the advertisement first runs for production costs that are initially capitalized) and represent online marketing, including fees paid to search engines and other online marketing platforms, partners who direct traffic to our brands, and app platforms, and offline marketing, which is primarily television, streaming, and radio advertising. Advertising expense was $333.3 million, $459.4 million and $558.4 million for the years ended December 31, 2024, 2023, and 2022, respectively.

Legal Costs

Legal costs, other than certain costs incurred to obtain financing, which are generally capitalized, are expensed as incurred.

Debt Issuance Costs

Costs incurred to obtain financing are deferred and amortized to “Interest expense” in the statement of operations over the related financing period using the effective interest method. The Company records debt issuance costs as a direct reduction of the carrying value of the related debt.

Income Taxes

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

any applicable related income tax benefit, for uncertain tax positions as a component of income tax expense. The Company elects to recognize the tax on Global Intangible Low-Taxed Income as a period expense in the period the tax is incurred.

Noncontrolling Interest

On August 28, 2024, the Company purchased the remaining noncontrolling interests of a foreign subsidiary for a total purchase price of $16.0 million in cash. As a result of this transaction, the Company recorded a net decrease to additional paid in capital of $11.3 million, representing the difference between the cash consideration related to the purchase of the remaining noncontrolling interest and the carrying value of the noncontrolling interest at the date of the transaction. All consolidated entities are now wholly-owned by the Company, and no noncontrolling interest remains outstanding as of December 31, 2024.

Earnings Per Share

Basic earnings (loss) per share is computed by dividing net earnings (loss) attributable to Angi Inc. shareholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects the potential dilution that could occur if stock appreciation rights, stock options and other commitments to issue common stock were exercised or equity awards vested resulting in the issuance of common stock that could share in the earnings of the Company. See “Note 13—Earnings (Loss) per Share” for additional information on dilutive securities.

Foreign Currency Translation and Transaction Gains and Losses

The financial position and operating results of foreign entities whose primary economic environment is based on their local currency are consolidated using the local currency as the functional currency. These local currency assets and liabilities are translated at the rates of exchange as of the balance sheet date, and local currency revenue and expenses of these operations are translated at average rates of exchange during the period. Translation gains and losses are included in accumulated other comprehensive income (loss) as a component of shareholders’ equity. Transaction gains and losses resulting from assets and liabilities denominated in a currency other than the functional currency are included in the statement of operations as a component of other income (expense), net. Translation gains and losses relating to foreign entities that are liquidated or substantially liquidated are reclassified out of accumulated other comprehensive income (loss) into earnings. See “Note 14—Financial Statement Details” for additional information regarding foreign currency exchange gains and losses.

Stock-Based Compensation

Stock-based compensation is measured at the grant date based on the fair value of the award and is expensed over the requisite service period. See “Note 10—Stock‐based Compensation” for a discussion of the Company’s stock-based compensation plans.

Certain Risks and Concentrations

The Company’s business is subject to certain risks and concentrations including dependence on third-party technology providers, exposure to risks associated with online commerce security and credit card fraud.

Financial instruments, which potentially subject the Company to concentration of credit risk, consist of cash and cash equivalents. Cash and cash equivalents are maintained with financial institutions and are in excess of any applicable third-party insurance limits, such as the Federal Deposit Insurance Corporation and the Securities Investor Protection Corporation.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Recent Accounting Pronouncements

Recent Accounting Pronouncements Adopted by the Company

Accounting Standards Update (“ASU”) No. 2023-07—Segment Reporting (Topic 280)—Improvements to Reportable Segment Disclosures

In November 2023, the FASB issued ASU No. 2023-07, which is intended to provide users of financial statements with more decision-useful information about reportable segments of a public business entity, primarily through enhanced disclosures of significant segment expenses. The Company adopted ASU No. 2023-07 effective for the fiscal year beginning January 1, 2024 and applied the new guidance retrospectively to all prior periods presented in the financial statements. See “Note 9—Segment Information” for additional information on the impact to the Company.

Recent Accounting Pronouncements Not Yet Adopted by the Company

ASU No. 2023-09— Income Taxes (Topic 740)— Improvements to Income Tax Disclosures

In December 2023, the FASB issued ASU No. 2023-09, which establishes required categories and a quantitative threshold to the annual tabular rate reconciliation disclosure and disaggregated jurisdictional disclosures of income taxes paid. The guidance’s annual requirements are effective for the Company beginning with the reporting period for the fiscal year ending December 31, 2025. Early adoption is permitted and ASU No. 2023-09 may be applied either prospectively or retrospectively. The Company is currently assessing ASU No. 2023-09, its impact on its income tax disclosures, and the method of adoption. ASU No. 2023-09 does not affect the Company’s results of operations, financial condition or cash flows. The Company does not plan to adopt ASU No. 2023-09 early.

ASU No. 2024-03— Income Statement-Reporting Comprehensive Income— Expense Disaggregation Disclosures (Subtopic 220-40)— Disaggregation of Income Statement Expenses

In November 2024, the FASB issued ASU No. 2024-03, which is intended to provide users of financial statements with more decision-useful information about expenses of a public business entity, primarily through enhanced disclosures of certain components of expenses commonly presented within captions on the statement of operations, such as purchases of inventory, employee compensation, depreciation and amortization, as well as a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. ASU No. 2024-03 also requires disclosure of the total amount of selling expenses and, in annual reporting periods, the definition of selling expenses. ASU No. 2024-03 is effective for fiscal years beginning after December 15, 2026 and for interim periods beginning after December 15, 2027. Early adoption is permitted and ASU No. 2024-03 may be applied either prospectively or retrospectively. The Company is currently assessing ASU No. 2024-03 and its impact on its disclosures, and the timing and method of adoption. ASU No. 2024-03 does not affect the Company's results of operations, financial condition or cash flows.

NOTE 3—FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS

The following tables present the Company’s financial instruments that are measured at fair value on a recurring basis:

Level 1 Level 2 Level 3 Total Fair Value Measurements

(In thousands)

Assets:

Cash equivalents:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Level 1 Level 2 Level 3 Total Fair Value Measurements

(In thousands)

Assets:

Cash equivalents:

Financial instruments measured at fair value only for disclosure purposes

The total fair value of the outstanding long-term debt, including the current portion, is estimated using observable market prices or indices for similar liabilities, which are Level 2 inputs, and was approximately $445.0 million and $418.1 million at December 31, 2024 and December 31, 2023, respectively.

NOTE 4—GOODWILL AND INTANGIBLE ASSETS

Goodwill and intangible assets, net are as follows:

December 31,

(In thousands)

The following table presents the balance of goodwill by reportable segment, including the changes in the carrying value of goodwill, for the year ended December 31, 2024:

(In thousands)

The following table presents the balance of goodwill by reportable segment, including the changes in the carrying value of goodwill, for the year ended December 31, 2023:

(In thousands)

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Intangible assets with indefinite lives are trade names and trademarks acquired in various acquisitions. Intangible assets with definite lives were fully amortized during the year ended December 31, 2023. At both December 31, 2024 and 2023, intangible assets with definite lives are as follows:

(Dollars in thousands)

See “Note 2—Summary of Significant Accounting Policies” for further discussion of the Company’s assessments of impairment of goodwill and indefinite-lived intangible assets.

NOTE 5—LEASES

The Company primarily leases office space used in connection with its operations under various operating leases, the majority of which contain escalation clauses.

ROU assets represent the Company’s right to use the underlying assets for the lease term and lease liabilities represent the present value of the Company’s obligation to make payments arising from these leases. ROU assets and related lease liabilities are based on the present value of fixed lease payments over the lease term using the Company’s incremental borrowing rate on the lease commencement date, the date of acquisition for any leases acquired in connection with a business combination, or January 1, 2019, the date ASC Topic 842, Leases (“ASC 842”) was adopted, for leases that commenced prior to that date. The Company combines the lease and non-lease components of lease payments in determining ROU assets and related lease liabilities. If the lease includes one or more options to extend the term of the lease, the renewal option is considered in the lease term if it is reasonably certain the Company will exercise the option(s). Lease expense is recognized on a straight-line basis over the term of the lease. As permitted by ASC 842, leases with an initial term of twelve months or less (“short-term leases”) are not recorded on the balance sheet.

Variable lease payments consist primarily of common area maintenance, utilities, and taxes, which are not included in the recognition of ROU assets and related lease liabilities. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The following table presents the balances of ROU assets and lease liabilities within the balance sheet:

December 31,

Leases Balance Sheet Classification 2024 2023

(In thousands)

Assets:

ROU assets Other non-current assets $ 30,418 $ 45,971

Liabilities:

Long-term lease liabilities Other long-term liabilities 35,494 51,550

The following table presents the net lease expense within the statement of operations:

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Year Ended December 31,

Lease Expense Statement of Operations Classification 2024 2023 2022

(In thousands)

Fixed lease expense Cost of revenue $ 410 $ 392 $ 437

Fixed lease expense Selling and marketing expense 196 116 2,669

Fixed lease expense Product development expense 643 399 492

Variable lease expense Selling and marketing expense — 36 200

Variable lease expense General and administrative expense 3,691 5,071 4,444

Variable lease expense Product development expense — 156 23

________________________________

(a) Includes (i) lease impairment charges of $7.2 million, $0.7 million, and $1.7 million, and (ii) sublease income of $4.3 million, $4.3 million, and $4.7 million for the years ended December 31, 2024, 2023, and 2022, respectively.

Maturities of lease liabilities as of December 31, 2024(b) are summarized below:

Year Ending December 31: (In thousands)

Present value of lease liabilities $ 48,318

________________________________

(b) At December 31, 2024 there were $1.3 million in legally binding minimum lease payments for leases signed but not yet commenced.

The following are the weighted average assumptions used for lease term and discount rate:

December 31,

Remaining lease term 4.0 years 4.4 years

The following is the supplemental cash flow information:

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ANGI INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

Year Ended December 31,

(In thousands)

ROU assets obtained in exchange for lease liabilities $ 1,241 $ 6,696 $ 2,911

ANGI US Equity

ANGI · 10-K · period ended 2024-12-31

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Item 8. Consolidated Financial Statements and Supplementary Data

ANGI US Equity☆

ANGI · 10-K · period ended 2024-12-31

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Item 8. Consolidated Financial Statements and Supplementary Data

ANGI US Equity