|
|
|
☒
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from__________to__________
|
|
Delaware
|
|
59-2712887
|
(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
Securities registered pursuant to Section 12(b) of the Act:
|
||||
Title of each class
|
|
Trading Symbol
|
|
Name of exchange on which registered
|
Common Stock, par value $0.001
|
|
IAC
|
|
The Nasdaq Stock Market LLC
|
Large accelerated filer
|
☒
|
Accelerated filer
|
☐
|
Non-accelerated filer
|
☐
|
Smaller reporting company
|
☐
|
Emerging growth company
|
☐
|
Common Stock
|
79,175,691
|
|
Class B Common Stock
|
5,789,499
|
|
Total outstanding Common Stock
|
84,965,190
|
|
|
|
Page
Number
|
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
||
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In thousands, except par value amounts)
|
||||||
ASSETS
|
|
|
|
||||
Cash and cash equivalents
|
$
|
2,822,729
|
|
|
$
|
3,139,295
|
|
Short-term investments
|
20,000
|
|
|
—
|
|
||
Marketable securities
|
49,912
|
|
|
19,993
|
|
||
Accounts receivable, net of allowance and reserves of $28,669 and $24,726, respectively
|
375,854
|
|
|
298,334
|
|
||
Other current assets
|
267,814
|
|
|
249,367
|
|
||
Total current assets
|
3,536,309
|
|
|
3,706,989
|
|
||
|
|
|
|
||||
Property, capitalized software and equipment, net of accumulated depreciation and amortization
|
373,561
|
|
|
371,353
|
|
||
Goodwill
|
3,042,139
|
|
|
2,854,462
|
|
||
Intangible assets, net of accumulated amortization
|
671,467
|
|
|
578,474
|
|
||
Long-term investments
|
301,592
|
|
|
353,052
|
|
||
Deferred income taxes
|
190,849
|
|
|
167,054
|
|
||
Other non-current assets
|
318,832
|
|
|
301,441
|
|
||
TOTAL ASSETS
|
$
|
8,434,749
|
|
|
$
|
8,332,825
|
|
|
|
|
|
||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|
|
|
||||
LIABILITIES:
|
|
|
|
||||
Current portion of long-term debt
|
$
|
13,750
|
|
|
$
|
13,750
|
|
Accounts payable, trade
|
102,367
|
|
|
94,356
|
|
||
Deferred revenue
|
433,728
|
|
|
397,490
|
|
||
Accrued expenses and other current liabilities
|
514,571
|
|
|
502,003
|
|
||
Total current liabilities
|
1,064,416
|
|
|
1,007,599
|
|
||
|
|
|
|
||||
Long-term debt, net
|
3,625,008
|
|
|
3,121,572
|
|
||
Income taxes payable
|
18,398
|
|
|
36,489
|
|
||
Deferred income taxes
|
19,398
|
|
|
21,388
|
|
||
Other long-term liabilities
|
210,274
|
|
|
202,932
|
|
||
|
|
|
|
||||
Redeemable noncontrolling interests
|
42,431
|
|
|
44,527
|
|
||
|
|
|
|
||||
Commitments and contingencies
|
|
|
|
||||
|
|
|
|
||||
SHAREHOLDERS' EQUITY:
|
|
|
|
||||
Common stock $.001 par value; authorized 1,600,000 shares; issued 263,502 and 263,230 shares, respectively, and outstanding 79,162 and 78,890 shares, respectively
|
264
|
|
|
263
|
|
||
Class B convertible common stock $.001 par value; authorized 400,000 shares; issued 16,157 shares and outstanding 5,789 shares
|
16
|
|
|
16
|
|
||
Additional paid-in capital
|
11,412,142
|
|
|
11,683,799
|
|
||
Retained earnings
|
1,478,885
|
|
|
1,689,925
|
|
||
Accumulated other comprehensive loss
|
(157,285
|
)
|
|
(136,349
|
)
|
||
Treasury stock 194,708 shares
|
(10,309,612
|
)
|
|
(10,309,612
|
)
|
||
Total IAC shareholders' equity
|
2,424,410
|
|
|
2,928,042
|
|
||
Noncontrolling interests
|
1,030,414
|
|
|
970,276
|
|
||
Total shareholders' equity
|
3,454,824
|
|
|
3,898,318
|
|
||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
|
$
|
8,434,749
|
|
|
$
|
8,332,825
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands, except per share data)
|
||||||
Revenue
|
$
|
1,228,765
|
|
|
$
|
1,105,843
|
|
Operating costs and expenses:
|
|
|
|
||||
Cost of revenue (exclusive of depreciation shown separately below)
|
323,221
|
|
|
260,071
|
|
||
Selling and marketing expense
|
432,697
|
|
|
421,860
|
|
||
General and administrative expense
|
256,021
|
|
|
213,616
|
|
||
Product development expense
|
105,733
|
|
|
88,700
|
|
||
Depreciation
|
24,738
|
|
|
18,971
|
|
||
Amortization of intangibles
|
52,162
|
|
|
22,752
|
|
||
Goodwill impairment
|
211,973
|
|
|
—
|
|
||
Total operating costs and expenses
|
1,406,545
|
|
|
1,025,970
|
|
||
Operating (loss) income
|
(177,780
|
)
|
|
79,873
|
|
||
Interest expense
|
(44,866
|
)
|
|
(31,143
|
)
|
||
Other (expense) income, net
|
(49,893
|
)
|
|
651
|
|
||
(Loss) earnings before income taxes
|
(272,539
|
)
|
|
49,381
|
|
||
Income tax benefit
|
89,896
|
|
|
63,604
|
|
||
Net (loss) earnings
|
(182,643
|
)
|
|
112,985
|
|
||
Net earnings attributable to noncontrolling interests
|
(28,397
|
)
|
|
(24,290
|
)
|
||
Net (loss) earnings attributable to IAC shareholders
|
$
|
(211,040
|
)
|
|
$
|
88,695
|
|
|
|
|
|
||||
Per share information attributable to IAC shareholders:
|
|
|
|||||
Basic (loss) earnings per share
|
$
|
(2.49
|
)
|
|
$
|
1.06
|
|
Diluted (loss) earnings per share
|
$
|
(2.49
|
)
|
|
$
|
0.91
|
|
|
|
|
|
||||
Stock-based compensation expense by function:
|
|
|
|
||||
Cost of revenue
|
$
|
1,185
|
|
|
$
|
1,289
|
|
Selling and marketing expense
|
2,424
|
|
|
2,717
|
|
||
General and administrative expense
|
44,637
|
|
|
45,010
|
|
||
Product development expense
|
10,218
|
|
|
18,428
|
|
||
Total stock-based compensation expense
|
$
|
58,464
|
|
|
$
|
67,444
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Net (loss) earnings
|
$
|
(182,643
|
)
|
|
$
|
112,985
|
|
Other comprehensive (loss) income, net of income taxes:
|
|
|
|
||||
Change in foreign currency translation adjustment
|
(26,093
|
)
|
|
1,309
|
|
||
Change in unrealized gains and losses on available-for-sale debt securities
|
(12
|
)
|
|
1
|
|
||
Total other comprehensive (loss) income, net of income taxes
|
(26,105
|
)
|
|
1,310
|
|
||
Comprehensive (loss) income, net of income taxes
|
(208,748
|
)
|
|
114,295
|
|
||
Components of comprehensive (income) loss attributable to noncontrolling interests:
|
|
|
|
||||
Net income attributable to noncontrolling interests
|
(28,397
|
)
|
|
(24,290
|
)
|
||
Change in foreign currency translation adjustment attributable to noncontrolling interests
|
4,766
|
|
|
(316
|
)
|
||
Change in unrealized gains and losses of available-for-sale debt securities attributable to noncontrolling interests
|
—
|
|
|
1
|
|
||
Comprehensive income attributable to noncontrolling interests
|
(23,631
|
)
|
|
(24,605
|
)
|
||
Comprehensive (loss) income attributable to IAC shareholders
|
$
|
(232,379
|
)
|
|
$
|
89,690
|
|
|
|
|
|
IAC Shareholders' Equity
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
Class B
Convertible Common Stock $.001 Par Value |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
|
|
|
|
Common
Stock $.001 Par Value |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
Accumulated
Other Comprehensive (Loss) Income |
|
|
|
Total IAC
Shareholders' Equity |
|
|
|
|
||||||||||||||||||||||||||||||
|
Redeemable
Noncontrolling Interests |
|
|
Additional
Paid-in Capital |
|
Retained Earnings
|
|
Treasury
Stock |
|
|
Noncontrolling
Interests |
|
Total
Shareholders' Equity |
|||||||||||||||||||||||||||||||||
|
$
|
|
Shares
|
|
$
|
|
Shares
|
|
|
|||||||||||||||||||||||||||||||||||||
|
|
|
|
(In thousands)
|
|
|
||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2019
|
$
|
44,527
|
|
|
|
$
|
263
|
|
|
263,230
|
|
|
$
|
16
|
|
|
16,157
|
|
|
$
|
11,683,799
|
|
|
$
|
1,689,925
|
|
|
$
|
(136,349
|
)
|
|
$
|
(10,309,612
|
)
|
|
$
|
2,928,042
|
|
|
$
|
970,276
|
|
|
$
|
3,898,318
|
|
Net (loss) earnings
|
(1,462
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(211,040
|
)
|
|
—
|
|
|
—
|
|
|
(211,040
|
)
|
|
29,859
|
|
|
(181,181
|
)
|
||||||||||
Other comprehensive income (loss), net of income taxes
|
99
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(21,339
|
)
|
|
—
|
|
|
(21,339
|
)
|
|
(4,865
|
)
|
|
(26,204
|
)
|
||||||||||
Stock-based compensation expense
|
15
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,499
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11,499
|
|
|
44,586
|
|
|
56,085
|
|
||||||||||
Issuance of common stock pursuant to stock-based awards, net of withholding taxes
|
—
|
|
|
|
1
|
|
|
272
|
|
|
—
|
|
|
—
|
|
|
(20,516
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,515
|
)
|
|
—
|
|
|
(20,515
|
)
|
||||||||||
Purchase of redeemable noncontrolling interests
|
(3,165
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Adjustment of redeemable noncontrolling interests to fair value
|
2,418
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,418
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,418
|
)
|
|
—
|
|
|
(2,418
|
)
|
||||||||||
Issuance of Match Group and ANGI Homeservices common stock pursuant to stock-based awards, net of withholding taxes
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(139,565
|
)
|
|
—
|
|
|
403
|
|
|
—
|
|
|
(139,162
|
)
|
|
(9,442
|
)
|
|
(148,604
|
)
|
||||||||||
Purchase of Match Group and ANGI Homeservices treasury stock
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(120,658
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(120,658
|
)
|
|
—
|
|
|
(120,658
|
)
|
||||||||||
Other
|
(1
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||||||||
Balance as of March 31, 2020
|
$
|
42,431
|
|
|
|
$
|
264
|
|
|
263,502
|
|
|
$
|
16
|
|
|
16,157
|
|
|
$
|
11,412,142
|
|
|
$
|
1,478,885
|
|
|
$
|
(157,285
|
)
|
|
$
|
(10,309,612
|
)
|
|
$
|
2,424,410
|
|
|
$
|
1,030,414
|
|
|
$
|
3,454,824
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||||||||||
Balance as of December 31, 2018
|
$
|
65,687
|
|
|
|
$
|
262
|
|
|
262,303
|
|
|
$
|
16
|
|
|
16,157
|
|
|
$
|
12,022,387
|
|
|
$
|
1,258,794
|
|
|
$
|
(128,722
|
)
|
|
$
|
(10,309,612
|
)
|
|
$
|
2,843,125
|
|
|
$
|
708,676
|
|
|
$
|
3,551,801
|
|
Net (loss) earnings
|
(1,051
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
88,695
|
|
|
—
|
|
|
—
|
|
|
88,695
|
|
|
25,341
|
|
|
114,036
|
|
||||||||||
Other comprehensive income, net of income taxes
|
186
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
995
|
|
|
—
|
|
|
995
|
|
|
129
|
|
|
1,124
|
|
||||||||||
Stock-based compensation expense
|
42
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,165
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
20,165
|
|
|
47,237
|
|
|
67,402
|
|
||||||||||
Issuance of common stock pursuant to stock-based awards, net of withholding taxes
|
—
|
|
|
|
1
|
|
|
326
|
|
|
—
|
|
|
—
|
|
|
(4,911
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,910
|
)
|
|
—
|
|
|
(4,910
|
)
|
||||||||||
Purchase of redeemable noncontrolling interests
|
(3,182
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Adjustment of redeemable noncontrolling interests to fair value
|
10,242
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,242
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10,242
|
)
|
|
—
|
|
|
(10,242
|
)
|
||||||||||
Issuance of Match Group and ANGI Homeservices common stock pursuant to stock-based awards, net of withholding taxes
|
—
|
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(158,958
|
)
|
|
—
|
|
|
1,008
|
|
|
—
|
|
|
(157,950
|
)
|
|
10,092
|
|
|
(147,858
|
)
|
||||||||||
Other
|
(10
|
)
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17
|
)
|
|
—
|
|
|
(17
|
)
|
||||||||||
Balance as of March 31, 2019
|
$
|
71,914
|
|
|
|
$
|
263
|
|
|
262,629
|
|
|
$
|
16
|
|
|
16,157
|
|
|
$
|
11,868,424
|
|
|
$
|
1,347,489
|
|
|
$
|
(126,719
|
)
|
|
$
|
(10,309,612
|
)
|
|
$
|
2,779,861
|
|
|
$
|
791,475
|
|
|
$
|
3,571,336
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Cash flows from operating activities:
|
|
|
|
||||
Net (loss) earnings
|
$
|
(182,643
|
)
|
|
$
|
112,985
|
|
Adjustments to reconcile net earnings to net cash provided by operating activities:
|
|
|
|
||||
Stock-based compensation expense
|
58,464
|
|
|
67,444
|
|
||
Amortization of intangibles
|
52,162
|
|
|
22,752
|
|
||
Depreciation
|
24,738
|
|
|
18,971
|
|
||
Bad debt expense
|
19,931
|
|
|
15,005
|
|
||
Goodwill impairment
|
211,973
|
|
|
—
|
|
||
Deferred income taxes
|
(59,166
|
)
|
|
(65,107
|
)
|
||
Losses on equity securities, net
|
51,473
|
|
|
44
|
|
||
Other adjustments, net
|
20,690
|
|
|
18,697
|
|
||
Changes in assets and liabilities, net of effects of acquisitions and dispositions:
|
|
|
|
|
|||
Accounts receivable
|
(79,799
|
)
|
|
(88,367
|
)
|
||
Other assets
|
10,172
|
|
|
6,730
|
|
||
Accounts payable and other liabilities
|
(24,720
|
)
|
|
(26,829
|
)
|
||
Income taxes payable and receivable
|
(47,787
|
)
|
|
(6,154
|
)
|
||
Deferred revenue
|
25,487
|
|
|
26,770
|
|
||
Net cash provided by operating activities
|
80,975
|
|
|
102,941
|
|
||
Cash flows from investing activities:
|
|
|
|
||||
Acquisitions, net of cash acquired
|
(532,857
|
)
|
|
(21,555
|
)
|
||
Capital expenditures
|
(24,591
|
)
|
|
(25,855
|
)
|
||
Proceeds from maturities of marketable debt securities
|
20,000
|
|
|
123,500
|
|
||
Purchases of marketable debt securities
|
(49,806
|
)
|
|
(39,740
|
)
|
||
Net proceeds from the sale of businesses and investments
|
1,476
|
|
|
20,472
|
|
||
Purchases of investments
|
(25
|
)
|
|
—
|
|
||
Other, net
|
(203
|
)
|
|
(1,215
|
)
|
||
Net cash (used in) provided by investing activities
|
(586,006
|
)
|
|
55,607
|
|
||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from issuance of Match Group debt
|
500,000
|
|
|
350,000
|
|
||
Borrowings under Match Group Credit Facility
|
—
|
|
|
40,000
|
|
||
Principal payments on Match Group Credit Facility
|
—
|
|
|
(300,000
|
)
|
||
Principal payments on ANGI Homeservices Term Loan
|
(3,438
|
)
|
|
(3,438
|
)
|
||
Debt issuance costs
|
(8,977
|
)
|
|
(5,542
|
)
|
||
Purchase of Match Group and ANGI Homeservices treasury stock
|
(120,198
|
)
|
|
(24,186
|
)
|
||
Proceeds from the exercise of IAC stock options
|
412
|
|
|
9,298
|
|
||
Proceeds from the exercise of Match Group and ANGI Homeservices stock options
|
—
|
|
|
573
|
|
||
Withholding taxes paid on behalf of IAC employees on net settled stock-based awards
|
(20,927
|
)
|
|
(14,062
|
)
|
||
Withholding taxes paid on behalf of Match Group and ANGI Homeservices employees on net settled stock-based awards
|
(148,580
|
)
|
|
(123,148
|
)
|
||
Purchase of noncontrolling interests
|
(3,165
|
)
|
|
(3,182
|
)
|
||
Other, net
|
(464
|
)
|
|
27
|
|
||
Net cash provided by (used in) financing activities
|
194,663
|
|
|
(73,660
|
)
|
||
Total cash (used) provided
|
(310,368
|
)
|
|
84,888
|
|
||
Effect of exchange rate changes on cash and cash equivalents and restricted cash
|
(5,996
|
)
|
|
815
|
|
||
Net (decrease) increase in cash and cash equivalents and restricted cash
|
(316,364
|
)
|
|
85,703
|
|
||
Cash and cash equivalents and restricted cash at beginning of period
|
3,140,358
|
|
|
2,133,685
|
|
||
Cash and cash equivalents and restricted cash at end of period
|
$
|
2,823,994
|
|
|
$
|
2,219,388
|
|
•
|
Match Group were 80.4%, and 97.4%, respectively. All references to "Match Group" or "MTCH" in this report are to Match Group, Inc.
|
•
|
ANGI Homeservices were 84.9%, and 98.3%, respectively. All reference to "ANGI Homeservices" or "ANGI" in this report are to ANGI Homeservices Inc.
|
•
|
a $212.0 million impairment related to the goodwill of the Desktop reporting unit;
|
•
|
a $21.4 million impairment related to certain indefinite-lived intangible assets of the Desktop reporting unit;
|
•
|
a $4.6 million impairment related to certain indefinite-lived intangible assets of the Match Group reporting unit;
|
•
|
a $51.5 million impairment of certain equity securities without readily determinable fair values; and
|
•
|
a $7.5 million impairment of a note receivable and a warrant related to certain investees.
|
•
|
a refund of federal income taxes due to a five-year carryback of net operating loss incurred in 2019;
|
•
|
accelerated depreciation deductions;
|
•
|
a relaxation of interest expense deduction limitations for income tax purposes; and
|
•
|
a deferral of 2020 employer social security payroll taxes.
|
|
March 31,
|
|
December 31,
|
||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Goodwill
|
$
|
3,042,139
|
|
|
$
|
2,854,462
|
|
Intangible assets with indefinite lives
|
473,208
|
|
|
446,495
|
|
||
Intangible assets with definite lives, net of accumulated amortization
|
198,259
|
|
|
131,979
|
|
||
Total goodwill and intangible assets, net
|
$
|
3,713,606
|
|
|
$
|
3,432,936
|
|
|
Balance at
December 31, 2019 |
|
Additions
|
|
(Deductions)
|
|
Impairment
|
|
Foreign
Exchange Translation |
|
Balance at
March 31, 2020 |
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Match Group
|
$
|
1,239,840
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(12,108
|
)
|
|
$
|
1,227,732
|
|
ANGI Homeservices
|
882,051
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,867
|
)
|
|
877,184
|
|
||||||
Vimeo
|
219,374
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
|
—
|
|
|
219,336
|
|
||||||
Applications:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Desktop
|
265,146
|
|
|
—
|
|
|
—
|
|
|
(211,973
|
)
|
|
—
|
|
|
53,173
|
|
||||||
Mosaic Group
|
239,602
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(134
|
)
|
|
239,468
|
|
||||||
Total Applications
|
504,748
|
|
|
—
|
|
|
—
|
|
|
(211,973
|
)
|
|
(134
|
)
|
|
292,641
|
|
||||||
Emerging & Other
|
8,449
|
|
|
416,797
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
425,246
|
|
||||||
Total
|
$
|
2,854,462
|
|
|
$
|
416,797
|
|
|
$
|
(38
|
)
|
|
$
|
(211,973
|
)
|
|
$
|
(17,109
|
)
|
|
$
|
3,042,139
|
|
•
|
a $212.0 million impairment related to the goodwill of the Desktop reporting unit;
|
•
|
a $21.4 million impairment related to certain indefinite-lived intangible assets of the Desktop reporting unit; and
|
•
|
a $4.6 million impairment related to certain indefinite-lived intangible assets of the Match Group reporting unit.
|
|
Balance at
December 31, 2018 |
|
Additions
|
|
(Deductions)
|
|
Impairment
|
|
Foreign
Exchange Translation |
|
Balance at
December 31, 2019 |
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Match Group
|
$
|
1,245,013
|
|
|
$
|
3,553
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(8,726
|
)
|
|
$
|
1,239,840
|
|
ANGI Homeservices
|
892,800
|
|
|
18,326
|
|
|
(29,267
|
)
|
|
—
|
|
|
192
|
|
|
882,051
|
|
||||||
Vimeo
|
77,152
|
|
|
142,222
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
219,374
|
|
||||||
Applications:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Desktop
|
265,146
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
265,146
|
|
||||||
Mosaic Group
|
239,746
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(144
|
)
|
|
239,602
|
|
||||||
Total Applications
|
504,892
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(144
|
)
|
|
504,748
|
|
||||||
Emerging & Other
|
7,002
|
|
|
4,765
|
|
|
—
|
|
|
(3,318
|
)
|
|
—
|
|
|
8,449
|
|
||||||
Total
|
$
|
2,726,859
|
|
|
$
|
168,866
|
|
|
$
|
(29,267
|
)
|
|
$
|
(3,318
|
)
|
|
$
|
(8,678
|
)
|
|
$
|
2,854,462
|
|
|
March 31, 2020
|
||||||||||||
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
|
|
Weighted-Average
Useful Life (Years) |
||||||
|
(In thousands)
|
|
|
||||||||||
Technology
|
$
|
203,737
|
|
|
$
|
(87,442
|
)
|
|
$
|
116,295
|
|
|
4.7
|
Service professional relationships
|
99,850
|
|
|
(83,560
|
)
|
|
16,290
|
|
|
3.0
|
|||
Customer lists and user base
|
79,768
|
|
|
(26,804
|
)
|
|
52,964
|
|
|
4.0
|
|||
Trade names
|
21,868
|
|
|
(15,544
|
)
|
|
6,324
|
|
|
2.7
|
|||
Memberships
|
15,900
|
|
|
(13,264
|
)
|
|
2,636
|
|
|
3.0
|
|||
Other
|
14,703
|
|
|
(10,953
|
)
|
|
3,750
|
|
|
3.7
|
|||
Total
|
$
|
435,826
|
|
|
$
|
(237,567
|
)
|
|
$
|
198,259
|
|
|
4.0
|
|
December 31, 2019
|
||||||||||||
|
Gross
Carrying Amount |
|
Accumulated
Amortization |
|
Net
|
|
Weighted-Average
Useful Life (Years) |
||||||
|
(In thousands)
|
|
|
||||||||||
Technology
|
$
|
154,052
|
|
|
$
|
(79,358
|
)
|
|
$
|
74,694
|
|
|
4.6
|
Service professional relationships
|
99,651
|
|
|
(76,445
|
)
|
|
23,206
|
|
|
2.9
|
|||
Customer lists and user base
|
44,548
|
|
|
(24,488
|
)
|
|
20,060
|
|
|
3.3
|
|||
Trade names
|
19,074
|
|
|
(13,068
|
)
|
|
6,006
|
|
|
3.2
|
|||
Memberships
|
15,900
|
|
|
(11,940
|
)
|
|
3,960
|
|
|
3.0
|
|||
Other
|
13,952
|
|
|
(9,899
|
)
|
|
4,053
|
|
|
3.7
|
|||
Total
|
$
|
347,177
|
|
|
$
|
(215,198
|
)
|
|
$
|
131,979
|
|
|
3.8
|
|
(In thousands)
|
||
Remainder of 2020
|
$
|
60,498
|
|
2021
|
45,014
|
|
|
2022
|
39,859
|
|
|
2023
|
30,119
|
|
|
2024
|
15,841
|
|
|
Thereafter
|
6,928
|
|
|
Total
|
$
|
198,259
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In thousands)
|
||||||
Available-for-sale marketable debt securities
|
$
|
49,912
|
|
|
$
|
19,993
|
|
Total marketable securities
|
$
|
49,912
|
|
|
$
|
19,993
|
|
|
Amortized
Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair Value
|
||||||||
|
(In thousands)
|
||||||||||||||
Treasury discount notes
|
$
|
49,924
|
|
|
$
|
—
|
|
|
$
|
(12
|
)
|
|
$
|
49,912
|
|
Total available-for-sale marketable debt securities
|
$
|
49,924
|
|
|
$
|
—
|
|
|
$
|
(12
|
)
|
|
$
|
49,912
|
|
|
Amortized
Cost |
|
Gross
Unrealized Gains |
|
Gross
Unrealized Losses |
|
Fair Value
|
||||||||
|
(In thousands)
|
||||||||||||||
Commercial paper
|
19,993
|
|
|
—
|
|
|
—
|
|
|
19,993
|
|
||||
Total available-for-sale marketable debt securities
|
$
|
19,993
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
19,993
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Upward adjustments (gross unrealized gains)
|
$
|
—
|
|
|
$
|
—
|
|
Downward adjustments including impairment (gross unrealized losses)
|
(51,484
|
)
|
|
(150
|
)
|
||
Total
|
$
|
(51,484
|
)
|
|
$
|
(150
|
)
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Realized gains, net, for equity securities sold
|
$
|
12
|
|
|
$
|
78
|
|
Unrealized losses, net, on equity securities held
|
(51,484
|
)
|
|
(122
|
)
|
||
Total losses, net recognized in other (expense) income, net
|
$
|
(51,472
|
)
|
|
$
|
(44
|
)
|
•
|
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.
|
|
March 31, 2020
|
||||||||||||||
|
Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
Fair Value
Measurements
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
2,007,519
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,007,519
|
|
Treasury discount notes
|
—
|
|
|
99,882
|
|
|
—
|
|
|
99,882
|
|
||||
Time deposits
|
—
|
|
|
72,809
|
|
|
—
|
|
|
72,809
|
|
||||
Short-term investments
|
—
|
|
|
20,000
|
|
|
—
|
|
|
20,000
|
|
||||
Marketable securities:
|
|
|
|
|
|
|
|
||||||||
Treasury discount notes
|
—
|
|
|
49,912
|
|
|
—
|
|
|
49,912
|
|
||||
Other non-current assets:
|
|
|
|
|
|
|
|
||||||||
Warrant
|
—
|
|
|
—
|
|
|
6,489
|
|
|
6,489
|
|
||||
Total
|
$
|
2,007,519
|
|
|
$
|
242,603
|
|
|
$
|
6,489
|
|
|
$
|
2,256,611
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration arrangement
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(636
|
)
|
|
$
|
(636
|
)
|
|
December 31, 2019
|
||||||||||||||
|
Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)
|
|
Significant
Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
|
Total
Fair Value
Measurements
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
2,164,576
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,164,576
|
|
Treasury discount notes
|
—
|
|
|
199,896
|
|
|
—
|
|
|
199,896
|
|
||||
Time deposits
|
—
|
|
|
128,075
|
|
|
—
|
|
|
128,075
|
|
||||
Commercial paper
|
—
|
|
|
29,960
|
|
|
—
|
|
|
29,960
|
|
||||
Marketable securities:
|
|
|
|
|
|
|
|
||||||||
Commercial paper
|
—
|
|
|
19,993
|
|
|
—
|
|
|
19,993
|
|
||||
Other non-current assets:
|
|
|
|
|
|
|
|
||||||||
Warrant
|
—
|
|
|
—
|
|
|
8,495
|
|
|
8,495
|
|
||||
Total
|
$
|
2,164,576
|
|
|
$
|
377,924
|
|
|
$
|
8,495
|
|
|
$
|
2,550,995
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Contingent consideration arrangement
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(6,918
|
)
|
|
$
|
(6,918
|
)
|
|
Three Months Ended March 31,
|
||||||||||
|
2020
|
|
2019
|
||||||||
|
Warrant
|
|
Contingent
Consideration Arrangements |
|
Contingent
Consideration Arrangement |
||||||
|
(In thousands)
|
||||||||||
Balance at January 1
|
$
|
8,495
|
|
|
$
|
(6,918
|
)
|
|
$
|
(28,631
|
)
|
Total net (losses) gains:
|
|
|
|
|
|
||||||
Included in earnings:
|
|
|
|
|
|
||||||
Fair value adjustments
|
(2,006
|
)
|
|
6,282
|
|
|
(1,529
|
)
|
|||
Included in other comprehensive loss
|
—
|
|
|
—
|
|
|
(14
|
)
|
|||
Fair value at date of acquisition
|
—
|
|
|
(1,000
|
)
|
|
—
|
|
|||
Settlements
|
—
|
|
|
1,000
|
|
|
1,988
|
|
|||
Balance at March 31
|
$
|
6,489
|
|
|
$
|
(636
|
)
|
|
$
|
(28,186
|
)
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||
|
Carrying
Value |
|
Fair
Value |
|
Carrying
Value |
|
Fair
Value |
||||||||
|
(In thousands)
|
||||||||||||||
Current portion of long-term debt
|
$
|
(13,750
|
)
|
|
$
|
(13,750
|
)
|
|
$
|
(13,750
|
)
|
|
$
|
(13,681
|
)
|
Long-term debt, net(a)
|
(3,625,008
|
)
|
|
(4,017,844
|
)
|
|
(3,121,572
|
)
|
|
(4,136,988
|
)
|
(a)
|
At March 31, 2020 and December 31, 2019, the carrying value of long-term debt, net includes unamortized original issue discount and debt issuance costs of $397.8 million and $404.7 million, respectively.
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In thousands)
|
||||||
MTCH debt:
|
|
|
|
||||
MTCH Term Loan due February 13, 2027
|
$
|
425,000
|
|
|
$
|
425,000
|
|
6.375% Senior Notes due June 1, 2024 (the "6.375% MTCH Senior Notes"); interest payable each June 1 and December 1
|
400,000
|
|
|
400,000
|
|
||
5.00% Senior Notes due December 15, 2027 (the "5.00% MTCH Senior Notes"); interest payable each June 15 and December 15
|
450,000
|
|
|
450,000
|
|
||
5.625% Senior Notes due February 15, 2029 (the "5.625% MTCH Senior Notes"); interest payable each February 15 and August 15
|
350,000
|
|
|
350,000
|
|
||
4.125% Senior Notes due August 1, 2030 (the "4.125% MTCH Senior Notes"); interest payable each February 1 and August 1; commencing August 1, 2020
|
500,000
|
|
|
—
|
|
||
Total MTCH long-term debt
|
2,125,000
|
|
|
1,625,000
|
|
||
Less: unamortized original issue discount
|
6,618
|
|
|
6,282
|
|
||
Less: unamortized debt issuance costs
|
20,428
|
|
|
15,235
|
|
||
Total MTCH debt, net
|
2,097,954
|
|
|
1,603,483
|
|
||
|
|
|
|
||||
ANGI debt:
|
|
|
|
||||
ANGI Term Loan due November 5, 2023
|
244,063
|
|
|
247,500
|
|
||
Less: current portion of ANGI Term Loan
|
13,750
|
|
|
13,750
|
|
||
Less: unamortized debt issuance costs
|
1,670
|
|
|
1,804
|
|
||
Total ANGI debt, net
|
228,643
|
|
|
231,946
|
|
||
|
|
|
|
||||
IAC debt:
|
|
|
|
||||
0.875% Exchangeable Senior Notes due October 1, 2022 (the "2022 Exchangeable Notes"); interest payable each April 1 and October 1
|
517,500
|
|
|
517,500
|
|
||
0.875% Exchangeable Senior Notes due June 15, 2026 (the "2026 Exchangeable Notes"); interest payable each June 15 and December 15
|
575,000
|
|
|
575,000
|
|
||
2.00% Exchangeable Senior Notes due January 15, 2030 (the "2030 Exchangeable Notes"); interest payable each January 15 and July 15
|
575,000
|
|
|
575,000
|
|
||
Total IAC long-term debt
|
1,667,500
|
|
|
1,667,500
|
|
||
Less: unamortized original issue discount
|
340,688
|
|
|
351,605
|
|
||
Less: unamortized debt issuance costs
|
28,401
|
|
|
29,752
|
|
||
Total IAC debt, net
|
1,298,411
|
|
|
1,286,143
|
|
||
|
|
|
|
||||
Total long-term debt, net
|
$
|
3,625,008
|
|
|
$
|
3,121,572
|
|
|
|
Number of shares of the Company's Common Stock into which each $1,000 of Principal of the Exchangeable Notes is Exchangeable*
|
|
Approximate Equivalent Exchange Price per Share*
|
|
Exchangeable Date
|
||
2022 Exchangeable Notes
|
|
6.5713
|
|
$
|
152.18
|
|
|
July 1, 2022
|
2026 Exchangeable Notes
|
|
3.3028
|
|
$
|
302.77
|
|
|
March 15, 2026
|
2030 Exchangeable Notes
|
|
3.4323
|
|
$
|
291.35
|
|
|
October 15, 2029
|
|
|
March 31, 2020
|
||||||||||
|
|
2022 Exchangeable Notes
|
|
2026 Exchangeable Notes
|
|
2030 Exchangeable Notes
|
||||||
Liability component:
|
|
|
|
|
|
|
||||||
Principal
|
|
$
|
517,500
|
|
|
$
|
575,000
|
|
|
$
|
575,000
|
|
Less: unamortized original issue discount
|
|
37,314
|
|
|
124,820
|
|
|
178,554
|
|
|||
Net carrying value of the liability component
|
|
$
|
480,186
|
|
|
$
|
450,180
|
|
|
$
|
396,446
|
|
|
|
|
|
|
|
|
||||||
Equity component
|
|
$
|
70,363
|
|
|
$
|
138,796
|
|
|
$
|
189,213
|
|
|
|
|
|
|
|
|
||||||
|
|
December 31, 2019
|
||||||||||
|
|
2022 Exchangeable Notes
|
|
2026 Exchangeable Notes
|
|
2030 Exchangeable Notes
|
||||||
Liability component:
|
|
|
|
|
|
|
||||||
Principal
|
|
$
|
517,500
|
|
|
$
|
575,000
|
|
|
$
|
575,000
|
|
Less: unamortized original issue discount
|
|
40,768
|
|
|
129,037
|
|
|
181,800
|
|
|||
Net carrying value of the liability component
|
|
$
|
476,732
|
|
|
$
|
445,963
|
|
|
$
|
393,200
|
|
|
|
|
|
|
|
|
||||||
Equity component
|
|
$
|
70,363
|
|
|
$
|
138,796
|
|
|
$
|
189,213
|
|
|
|
Three Months Ended March 31, 2020
|
||||||||||
|
|
2022 Exchangeable Notes
|
|
2026 Exchangeable Notes
|
|
2030 Exchangeable Notes
|
||||||
Contractual interest expense
|
|
$
|
1,132
|
|
|
$
|
1,258
|
|
|
$
|
2,875
|
|
Amortization of original issue discount
|
|
3,454
|
|
|
4,217
|
|
|
3,246
|
|
|||
Amortization of debt issuance costs
|
|
855
|
|
|
319
|
|
|
176
|
|
|||
Total interest expense recognized
|
|
$
|
5,441
|
|
|
$
|
5,794
|
|
|
$
|
6,297
|
|
|
|
Three Months Ended
March 31, 2019 |
|
|
|
|
||
|
|
2022 Exchangeable Notes
|
|
|
|
|
||
Contractual interest expense
|
|
$
|
1,132
|
|
|
|
|
|
Amortization of original issue discount
|
|
3,363
|
|
|
|
|
|
|
Amortization of debt issuance costs
|
|
871
|
|
|
|
|
|
|
Total interest expense recognized
|
|
$
|
5,366
|
|
|
|
|
|
|
Number of Shares*
|
|
Approximate Equivalent Exchange Price per Share*
|
|||
2022 Exchangeable Notes Hedge
|
3.4
|
|
|
$
|
152.18
|
|
2026 Exchangeable Notes Hedge
|
1.9
|
|
|
$
|
302.77
|
|
2030 Exchangeable Notes Hedge
|
2.0
|
|
|
$
|
291.35
|
|
|
Number of Shares*
|
|
Strike Price per Share*
|
|||
2022 Exchangeable Notes Warrants
|
3.4
|
|
|
$
|
229.70
|
|
2026 Exchangeable Notes Warrants
|
1.9
|
|
|
$
|
457.02
|
|
2030 Exchangeable Notes Warrants
|
2.0
|
|
|
$
|
457.02
|
|
|
(In thousands)
|
||
Remainder of 2020
|
$
|
10,313
|
|
2021
|
13,750
|
|
|
2022
|
545,000
|
|
|
2023
|
192,500
|
|
|
2024
|
400,000
|
|
|
Thereafter
|
2,875,000
|
|
|
Total
|
4,036,563
|
|
|
Less: current portion of long-term debt
|
13,750
|
|
|
Less: unamortized original issue discount
|
347,306
|
|
|
Less: unamortized debt issuance costs
|
50,499
|
|
|
Total long-term debt, net
|
$
|
3,625,008
|
|
|
Three Months Ended March 31, 2020
|
||||||||||
|
Foreign Currency Translation Adjustment
|
|
Unrealized Losses On Available-For-Sale Debt Securities
|
|
Accumulated Other Comprehensive Loss
|
||||||
|
(In thousands)
|
||||||||||
Balance as of January 1
|
$
|
(136,349
|
)
|
|
$
|
—
|
|
|
$
|
(136,349
|
)
|
Other comprehensive loss before reclassifications
|
(21,307
|
)
|
|
(12
|
)
|
|
(21,319
|
)
|
|||
Amounts reclassified to earnings
|
(20
|
)
|
|
—
|
|
|
(20
|
)
|
|||
Net current period other comprehensive loss
|
(21,327
|
)
|
|
(12
|
)
|
|
(21,339
|
)
|
|||
Allocation of accumulated other comprehensive loss related to noncontrolling interests
|
403
|
|
|
—
|
|
|
403
|
|
|||
Balance as of March 31
|
$
|
(157,273
|
)
|
|
$
|
(12
|
)
|
|
$
|
(157,285
|
)
|
|
Three Months Ended March 31, 2019
|
||||||||||
|
Foreign Currency Translation Adjustment
|
|
Unrealized Gains On Available-For-Sale Debt Securities
|
|
Accumulated Other Comprehensive (Loss) Income
|
||||||
|
(In thousands)
|
||||||||||
Balance as of January 1
|
$
|
(128,726
|
)
|
|
$
|
4
|
|
|
$
|
(128,722
|
)
|
Other comprehensive income
|
993
|
|
|
2
|
|
|
995
|
|
|||
Net current period other comprehensive income
|
993
|
|
|
2
|
|
|
995
|
|
|||
Allocation of accumulated other comprehensive income related to noncontrolling interests
|
1,008
|
|
|
—
|
|
|
1,008
|
|
|||
Balance as of March 31
|
$
|
(126,725
|
)
|
|
$
|
6
|
|
|
$
|
(126,719
|
)
|
|
Three Months Ended March 31,
|
||||||||||||||
|
2020
|
|
2019
|
||||||||||||
|
Basic
|
|
Diluted
|
|
Basic
|
|
Diluted
|
||||||||
|
(In thousands, except per share data)
|
||||||||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Net (loss) earnings
|
$
|
(182,643
|
)
|
|
$
|
(182,643
|
)
|
|
$
|
112,985
|
|
|
$
|
112,985
|
|
Net earnings attributable to noncontrolling interests
|
(28,397
|
)
|
|
(28,397
|
)
|
|
(24,290
|
)
|
|
(24,290
|
)
|
||||
Impact from public subsidiaries' dilutive securities (b)
|
—
|
|
|
—
|
|
|
—
|
|
|
(6,696
|
)
|
||||
Net (loss) earnings attributable to IAC shareholders
|
$
|
(211,040
|
)
|
|
$
|
(211,040
|
)
|
|
$
|
88,695
|
|
|
$
|
81,999
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted average basic shares outstanding
|
84,839
|
|
|
84,839
|
|
|
83,905
|
|
|
83,905
|
|
||||
Dilutive securities(a) (b) (c) (d) (e)
|
—
|
|
|
—
|
|
|
—
|
|
|
6,435
|
|
||||
Denominator for earnings per share—weighted average shares (a) (b) (c) (d) (e)
|
84,839
|
|
|
84,839
|
|
|
83,905
|
|
|
90,340
|
|
||||
|
|
|
|
|
|
|
|
||||||||
(Loss) earnings per share attributable to IAC shareholders:
|
|||||||||||||||
(Loss) earnings per share
|
$
|
(2.49
|
)
|
|
$
|
(2.49
|
)
|
|
$
|
1.06
|
|
|
$
|
0.91
|
|
(a)
|
For the three months ended March 31, 2020, the Company had a loss from operations and as a result, approximately 19.7 million potentially dilutive securities were excluded from computing dilutive earnings per share because the impact would have been anti-dilutive. Accordingly, the weighted average basic shares outstanding were used to compute all earnings per share amounts.
|
(b)
|
IAC has the option to settle certain MTCH and ANGI stock-based awards in its shares. For the three months ended March 31, 2020, the Company had a loss from operations, therefore, the impact on earnings related to MTCH and ANGI's dilutive securities under the if-converted method are excluded as the impact is anti-dilutive. For the three months ended March 31, 2019, it is more dilutive for IAC to settle these ANGI equity awards and MTCH to settle these MTCH equity awards.
|
(c)
|
If the effect is dilutive, weighted average common shares outstanding include the incremental shares that would be issued upon the assumed exercise of stock options, warrants and subsidiary denominated equity, exchange of the Company's Exchangeable Notes and vesting of restricted stock units ("RSUs"). For the three months ended March 31, 2019, 3.4 million potentially dilutive securities are excluded from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive.
|
(d)
|
Market-based awards and performance-based stock units ("PSUs") are considered contingently issuable shares. Shares issuable upon exercise or vesting of market-based awards and PSUs are included in the denominator for earnings per share if (i) the applicable market or performance condition(s) has been met and (ii) the inclusion of the market-based awards and PSUs is dilutive for the respective reporting periods. For the three months ended March 31, 2019, 0.3 million shares underlying market-based awards and PSUs were excluded from the calculation of diluted earnings per share because the market or performance conditions had not been met.
|
(e)
|
It is the Company's intention to settle the Exchangeable Notes through a combination of cash, equal to the face amount of the notes, and shares; therefore, the Exchangeable Notes are only dilutive for periods during which the average price of IAC common stock exceeds the approximate $152.18, $302.77 and $291.35 per share exchange price per $1,000 principal amount of the 2022 Exchangeable Notes, the 2026 Exchangeable Notes and the 2030 Exchangeable Notes, respectively. The average price of IAC common stock was $207.01 for the three months ended March 31, 2019 and the dilutive impact of the 2022 Exchangeable Notes, which was the only series of Exchangeable Notes that was outstanding for the period, was 0.9 million shares.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Revenue:
|
|
|
|
||||
Match Group
|
$
|
544,642
|
|
|
$
|
464,625
|
|
ANGI Homeservices
|
343,650
|
|
|
303,443
|
|
||
Vimeo
|
56,968
|
|
|
43,581
|
|
||
Dotdash
|
44,120
|
|
|
33,961
|
|
||
Applications
|
104,148
|
|
|
143,549
|
|
||
Emerging & Other
|
135,305
|
|
|
116,748
|
|
||
Inter-segment eliminations
|
(68
|
)
|
|
(64
|
)
|
||
Total
|
$
|
1,228,765
|
|
|
$
|
1,105,843
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Match Group
|
|
|
|
||||
Direct revenue:
|
|
|
|
||||
North America
|
$
|
263,347
|
|
|
$
|
237,773
|
|
International
|
271,477
|
|
|
216,189
|
|
||
Total Direct revenue
|
534,824
|
|
|
453,962
|
|
||
Indirect revenue (principally advertising revenue)
|
9,818
|
|
|
10,663
|
|
||
Total Match Group revenue
|
$
|
544,642
|
|
|
$
|
464,625
|
|
|
|
|
|
||||
ANGI Homeservices
|
|
|
|
||||
Marketplace:
|
|
|
|
||||
Consumer connection revenue
|
$
|
239,830
|
|
|
$
|
201,582
|
|
Service professional membership subscription revenue
|
14,115
|
|
|
16,517
|
|
||
Other revenue
|
4,831
|
|
|
2,401
|
|
||
Total Marketplace revenue
|
258,776
|
|
|
220,500
|
|
||
Advertising and other revenue
|
65,356
|
|
|
61,494
|
|
||
Total North America revenue
|
324,132
|
|
|
281,994
|
|
||
Consumer connection revenue
|
15,689
|
|
|
17,123
|
|
||
Service professional membership subscription revenue
|
3,299
|
|
|
3,742
|
|
||
Advertising and other revenue
|
530
|
|
|
584
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Total Europe revenue
|
19,518
|
|
|
21,449
|
|
||
Total ANGI Homeservices revenue
|
$
|
343,650
|
|
|
$
|
303,443
|
|
|
|
|
|
||||
Vimeo
|
|
|
|
||||
Platform revenue
|
$
|
56,968
|
|
|
$
|
41,302
|
|
Hardware revenue
|
—
|
|
|
2,279
|
|
||
Total Vimeo revenue
|
$
|
56,968
|
|
|
$
|
43,581
|
|
|
|
|
|
||||
Dotdash
|
|
|
|
||||
Display advertising revenue
|
$
|
29,889
|
|
|
$
|
26,008
|
|
Performance marketing revenue
|
14,231
|
|
|
7,953
|
|
||
Total Dotdash revenue
|
$
|
44,120
|
|
|
$
|
33,961
|
|
|
|
|
|
||||
Applications
|
|
|
|
||||
Desktop:
|
|
|
|
||||
Advertising revenue:
|
|
|
|
||||
Google advertising revenue
|
$
|
46,091
|
|
|
$
|
88,050
|
|
Non-Google advertising revenue
|
3,223
|
|
|
3,348
|
|
||
Total advertising revenue
|
49,314
|
|
|
91,398
|
|
||
Subscription and other revenue
|
4,157
|
|
|
4,588
|
|
||
Total Desktop revenue
|
53,471
|
|
|
95,986
|
|
||
Mosaic Group:
|
|
|
|
||||
Subscription and other revenue
|
49,071
|
|
|
45,148
|
|
||
Advertising revenue
|
1,606
|
|
|
2,415
|
|
||
Total Mosaic Group revenue
|
50,677
|
|
|
47,563
|
|
||
Total Applications revenue
|
$
|
104,148
|
|
|
$
|
143,549
|
|
|
|
|
|
||||
Emerging & Other
|
|
|
|
||||
Advertising revenue:
|
|
|
|
||||
Google advertising revenue
|
$
|
81,968
|
|
|
$
|
96,273
|
|
Non-Google advertising revenue
|
22,261
|
|
|
7,176
|
|
||
Total advertising revenue
|
104,229
|
|
|
103,449
|
|
||
Other revenue
|
31,076
|
|
|
13,299
|
|
||
Total Emerging & Other revenue
|
$
|
135,305
|
|
|
$
|
116,748
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Revenue:
|
|
|
|
||||
United States
|
$
|
787,340
|
|
|
$
|
712,381
|
|
All other countries
|
441,425
|
|
|
393,462
|
|
||
Total
|
$
|
1,228,765
|
|
|
$
|
1,105,843
|
|
|
March 31,
2020 |
|
December 31,
2019 |
||||
|
(In thousands)
|
||||||
Long-lived assets (excluding goodwill, intangible assets and ROU assets):
|
|
|
|
||||
United States
|
$
|
348,146
|
|
|
$
|
345,937
|
|
All other countries
|
25,415
|
|
|
25,416
|
|
||
Total
|
$
|
373,561
|
|
|
$
|
371,353
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Operating income (loss):
|
|
|
|
||||
Match Group
|
$
|
134,681
|
|
|
$
|
118,828
|
|
ANGI Homeservices
|
(16,296
|
)
|
|
(3,641
|
)
|
||
Vimeo
|
(14,589
|
)
|
|
(17,784
|
)
|
||
Dotdash
|
2,411
|
|
|
3,047
|
|
||
Applications
|
(218,588
|
)
|
|
25,356
|
|
||
Emerging & Other
|
(19,845
|
)
|
|
(2,520
|
)
|
||
Corporate
|
(45,554
|
)
|
|
(43,413
|
)
|
||
Total
|
$
|
(177,780
|
)
|
|
$
|
79,873
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Adjusted EBITDA (a):
|
|
|
|
||||
Match Group
|
$
|
171,502
|
|
|
$
|
155,067
|
|
ANGI Homeservices
|
$
|
34,397
|
|
|
$
|
37,179
|
|
Vimeo
|
$
|
(11,408
|
)
|
|
$
|
(16,200
|
)
|
Dotdash
|
$
|
7,011
|
|
|
$
|
7,150
|
|
Applications
|
$
|
10,151
|
|
|
$
|
29,688
|
|
Emerging & Other
|
$
|
(16,980
|
)
|
|
$
|
(2,095
|
)
|
Corporate
|
$
|
(31,398
|
)
|
|
$
|
(20,220
|
)
|
(a)
|
The Company's primary financial measure is Adjusted EBITDA, which is defined as operating income excluding: (1) stock-based compensation expense; (2) depreciation; and (3) acquisition-related items consisting of (i) amortization of intangible assets and impairments of goodwill and intangible assets, if applicable, and (ii) gains and losses recognized on changes in the fair value of contingent consideration arrangements. The Company believes this measure is useful for analysts and investors as this measure allows a more meaningful comparison between the Company's performance and that of its competitors. The above items are excluded from the Company's Adjusted EBITDA measure because these items are non-cash in nature. Adjusted EBITDA has certain limitations because it excludes the impact of these expenses.
|
|
Three Months Ended March 31, 2020
|
||||||||||||||||||||||||||
|
Operating
Income
(Loss)
|
|
Stock-Based
Compensation
Expense
|
|
Depreciation
|
|
Amortization
of Intangibles
|
|
Acquisition-related Contingent Consideration Fair Value Adjustments
|
|
Goodwill
Impairment
|
|
Adjusted
EBITDA
|
||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||||||
Match Group
|
$
|
134,681
|
|
|
$
|
21,172
|
|
|
$
|
9,246
|
|
|
$
|
6,403
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
171,502
|
|
ANGI Homeservices
|
(16,296
|
)
|
|
$
|
25,575
|
|
|
$
|
12,138
|
|
|
$
|
12,980
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
34,397
|
|
|
Vimeo
|
(14,589
|
)
|
|
$
|
—
|
|
|
$
|
58
|
|
|
$
|
3,123
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(11,408
|
)
|
|
Dotdash
|
2,411
|
|
|
$
|
—
|
|
|
$
|
210
|
|
|
$
|
4,390
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7,011
|
|
|
Applications
|
(218,588
|
)
|
|
$
|
—
|
|
|
$
|
237
|
|
|
$
|
22,811
|
|
|
$
|
(6,282
|
)
|
|
$
|
211,973
|
|
|
$
|
10,151
|
|
|
Emerging & Other
|
(19,845
|
)
|
|
$
|
25
|
|
|
$
|
385
|
|
|
$
|
2,455
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(16,980
|
)
|
|
Corporate
|
(45,554
|
)
|
|
$
|
11,692
|
|
|
$
|
2,464
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(31,398
|
)
|
|
Total
|
(177,780
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Interest expense
|
(44,866
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Other expense, net
|
(49,893
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Loss before income taxes
|
(272,539
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Income tax benefit
|
89,896
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net loss
|
(182,643
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net earnings attributable to noncontrolling interests
|
(28,397
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net loss attributable to IAC shareholders
|
$
|
(211,040
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||||||
|
Operating
Income
(Loss)
|
|
Stock-Based
Compensation
Expense
|
|
Depreciation
|
|
Amortization
of Intangibles
|
|
Acquisition-related Contingent Consideration Fair Value Adjustments
|
|
Adjusted
EBITDA
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
Match Group
|
$
|
118,828
|
|
|
$
|
27,997
|
|
|
$
|
7,831
|
|
|
$
|
411
|
|
|
$
|
—
|
|
|
$
|
155,067
|
|
ANGI Homeservices
|
(3,641
|
)
|
|
$
|
19,282
|
|
|
$
|
6,999
|
|
|
$
|
14,539
|
|
|
$
|
—
|
|
|
$
|
37,179
|
|
|
Vimeo
|
(17,784
|
)
|
|
$
|
—
|
|
|
$
|
193
|
|
|
$
|
1,391
|
|
|
$
|
—
|
|
|
$
|
(16,200
|
)
|
|
Dotdash
|
3,047
|
|
|
$
|
—
|
|
|
$
|
226
|
|
|
$
|
3,877
|
|
|
$
|
—
|
|
|
$
|
7,150
|
|
|
Applications
|
25,356
|
|
|
$
|
—
|
|
|
$
|
419
|
|
|
$
|
2,384
|
|
|
$
|
1,529
|
|
|
$
|
29,688
|
|
|
Emerging & Other
|
(2,520
|
)
|
|
$
|
—
|
|
|
$
|
275
|
|
|
$
|
150
|
|
|
$
|
—
|
|
|
$
|
(2,095
|
)
|
|
Corporate
|
(43,413
|
)
|
|
$
|
20,165
|
|
|
$
|
3,028
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(20,220
|
)
|
|
Total
|
79,873
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Interest expense
|
(31,143
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Other income, net
|
651
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Earnings before income taxes
|
49,381
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Income tax benefit
|
63,604
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings
|
112,985
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to noncontrolling interests
|
(24,290
|
)
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Net earnings attributable to IAC shareholders
|
$
|
88,695
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2020
|
|
December 31, 2019
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||
|
(In thousands)
|
||||||||||||||
Cash and cash equivalents
|
$
|
2,822,729
|
|
|
$
|
3,139,295
|
|
|
$
|
2,217,337
|
|
|
$
|
2,131,632
|
|
Restricted cash included in other current assets
|
867
|
|
|
654
|
|
|
1,635
|
|
|
1,633
|
|
||||
Restricted cash included in other assets
|
398
|
|
|
409
|
|
|
416
|
|
|
420
|
|
||||
Total cash and cash equivalents and restricted cash as shown on the consolidated statement of cash flows
|
$
|
2,823,994
|
|
|
$
|
3,140,358
|
|
|
$
|
2,219,388
|
|
|
$
|
2,133,685
|
|
Asset Category
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In thousands)
|
||||||
Right-of-use assets (included in "other non-current assets")
|
$
|
59,237
|
|
|
$
|
47,815
|
|
Property, capitalized software and equipment
|
$
|
335,766
|
|
|
$
|
324,359
|
|
Intangible assets
|
$
|
237,567
|
|
|
$
|
215,198
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Other (expense) income, net
|
$
|
(49,893
|
)
|
|
$
|
651
|
|
•
|
Match Group ("MTCH") - is a leading provider of subscription dating products, with a portfolio of dating brands, including Tinder, Match, PlentyOfFish and OkCupid. At March 31, 2020, IAC’s economic interest and voting interest in MTCH were 80.4% and 97.4%, respectively.
|
•
|
ANGI Homeservices ("ANGI") - connects quality home service professionals across 500 different categories, from repairing and remodeling to cleaning and landscaping, with consumers through category-transforming products under brands such as HomeAdvisor, Angie’s List, Handy and Fixd Repair. At March 31, 2020, IAC’s economic interest and voting interest in ANGI were 84.9% and 98.3%, respectively.
|
•
|
Vimeo - operates a global video platform for creative professionals, small and medium businesses ("SMBs"), organizations and enterprises to connect with their audiences, customers and employees.
|
•
|
Dotdash - is a portfolio of digital brands providing expert information and inspiration in select vertical content categories.
|
•
|
Applications - consists of Desktop, which includes our direct-to-consumer downloadable desktop applications and the business-to-business partnership operations, and Mosaic Group, which is a leading provider of global subscription mobile applications of Apalon, iTranslate and TelTech.
|
•
|
Emerging & Other - consists of Ask Media Group, Care.com, a leading global platform for finding and managing family care, which was acquired on February 11, 2020, Bluecrew, NurseFly, a temporary healthcare staffing platform
|
•
|
North America - consists of the financial results and metrics associated with users located in the United States and Canada.
|
•
|
International - consists of the financial results and metrics associated with users located outside of the United States and Canada.
|
•
|
Direct Revenue - is revenue that is received directly from end users of its products and includes both subscription and à la carte revenue.
|
•
|
Subscribers - are users who purchase a subscription to one of MTCH's products. Users who purchase only à la carte features are not included in Subscribers.
|
•
|
Average Subscribers - is the number of Subscribers at the end of each day in the relevant measurement period divided by the number of calendar days in that period.
|
•
|
Average Revenue per Subscriber ("ARPU") - is Direct Revenue from Subscribers in the relevant measurement period (whether in the form of subscription or à la carte revenue from Subscribers) divided by the Average Subscribers in such period and further divided by the number of calendar days in such period. Direct Revenue from users who are not Subscribers and have purchased only à la carte features is not included in ARPU.
|
•
|
Marketplace Revenue - includes revenue from the HomeAdvisor, Handy and Fixd Repair domestic marketplace, including consumer connection revenue for consumer matches, revenue from pre-priced jobs sourced through the HomeAdvisor, Handy and Fixd Repair platforms, and service professional membership subscription revenue. It excludes revenue from Angie's List, mHelpDesk and HomeStars. Effective January 1, 2020, Fixd Repair has been moved to Marketplace from Advertising & Other and prior year amounts have been reclassified to conform to the current year presentation.
|
•
|
Advertising & Other Revenue - includes Angie’s List revenue (revenue from service professionals under contract for advertising and membership subscription fees from consumers) as well as revenue from mHelpDesk and HomeStars.
|
•
|
Marketplace Service Requests - are fully completed and submitted domestic customer service requests to HomeAdvisor and jobs sourced through the HomeAdvisor, Handy and Fixd Repair platforms.
|
•
|
Marketplace Monetized Transactions - are fully completed and submitted domestic customer service requests to HomeAdvisor that were matched to and paid for by a service professional and jobs sourced through the HomeAdvisor, Handy and Fixd Repair platforms during the period.
|
•
|
Marketplace Transacting Service Professionals ("Marketplace Transacting SPs") - are the number of HomeAdvisor, Handy and Fixd Repair domestic service professionals that paid for consumer matches or performed a job sourced through the HomeAdvisor, Handy and Fixd Repair platforms during the quarter.
|
•
|
Platform Revenue - primarily includes revenue from Software-as-a-Service ("SaaS") subscription fees and other related revenue from Vimeo subscribers.
|
•
|
Hardware Revenue - includes sales of our live streaming accessories. Vimeo sold its hardware business on March 29, 2019.
|
•
|
Vimeo Ending Subscribers - is the number of subscribers to Vimeo's SaaS video tools at the end of the period (including the addition of subscribers from Magisto, a video creation service enabling consumers and businesses to create short-form videos acquired on May 28, 2019).
|
•
|
Display Advertising Revenue - primarily includes revenue generated from display advertisements sold both directly through our sales team and via programmatic exchanges.
|
•
|
Performance Marketing Revenue - primarily includes affiliate commerce and performance marketing commissions generated when consumers are directed from our properties to third-party service providers. Affiliate commerce commissions are generated when a consumer completes a transaction. Performance marketing commissions are generated on a cost-per-click or cost-per-new account basis.
|
•
|
Cost of revenue - consists primarily of traffic acquisition costs, which includes (i) the amortization of in-app purchase fees and (ii) payments made to partners who direct traffic to our Ask Media Group websites, who distribute our business-to-business customized browser-based applications and who integrate our paid listings into their websites. In-app purchase fees are monies paid to Apple and Google in connection with the processing of in-app purchases of subscriptions and product features through the in-app payment systems provided by Apple and Google. Traffic acquisition costs include payment of amounts based on revenue share and other arrangements. Cost of revenue also includes hosting fees, compensation expense (including stock-based compensation expense) and other employee-related costs for MTCH, Vimeo and Care.com customer care and support functions, personnel engaged in data center operations, employees at Fixd Repair for service work performed, payments made to workers staffed by Bluecrew, and payments made to independent service professionals who perform work contracted under pre-priced arrangements through the HomeAdvisor and Handy platforms, credit card processing fees, production costs related to IAC Films and for periods prior to its sale on March 16, 2020, College Humor Media, content costs and expenses associated with the operation of the Company's data centers.
|
•
|
Selling and marketing expense - consists primarily of advertising expenditures, which include online marketing, including fees paid to search engines, social media sites and third parties that distribute our direct-to-consumer downloadable desktop applications, offline marketing, which is primarily television advertising, and partner-related payments to those who direct traffic to the brands within our MTCH and ANGI segments, and compensation expense (including stock-based compensation expense) and other employee-related costs for ANGI's sales force and marketing personnel.
|
•
|
General and administrative expense - consists primarily of 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 (except for MTCH, Vimeo and Care.com which includes customer service costs within cost of revenue), fees for professional services (including transaction-related costs related to the Separation and acquisitions), rent expense, facilities costs, bad debt expense, software license and maintenance costs and acquisition-related contingent consideration fair value adjustments (described below). The customer service function at ANGI includes personnel who provide support to its service professionals and consumers.
|
•
|
Product development expense - consists primarily of 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 and software license and maintenance costs.
|
•
|
Acquisition-related contingent consideration fair value adjustments - relate to the portion of the purchase price of certain acquisitions that is contingent upon the financial performance and/or operating metric targets of the acquired company. The fair value of the liability is estimated at the date of acquisition and adjusted each reporting period until the liability is settled. Significant changes in financial performance and/or operating metrics will result in a significantly higher or lower fair value measurement. The changes in the estimated fair value of the contingent consideration arrangements during each reporting period, including the accretion of the discount if the arrangement is longer than one year, are recognized in "General and administrative expense" in the accompanying consolidated statement of operations.
|
•
|
MTCH Term Loan - On February 13, 2020, the MTCH Term Loan was amended to reprice the outstanding balance to LIBOR plus 1.75% and extend its maturity from November 16, 2022 to February 13, 2027. The outstanding balance of the MTCH Term Loan as of March 31, 2020 is $425.0 million. At March 31, 2020, the MTCH Term Loan bore interest at LIBOR plus 1.75% and was 3.46%. At December 31, 2019, the MTCH Term Loan bore interest at LIBOR plus 2.50%, or 4.44%.
|
•
|
MTCH Credit Facility - On February 13, 2020, the MTCH Credit Facility was amended to, among other things, increase the available borrowing capacity from $500 million to $750 million, reduce interest rate margins by 0.125%, and extend its maturity from December 7, 2023 to February 13, 2025. At March 31, 2020 and December 31, 2019, there were no outstanding borrowings under the MTCH Credit Facility.
|
•
|
6.375% MTCH Senior Notes - MTCH's 6.375% Senior Notes due June 1, 2024, with interest payable each June 1 and December 1. The outstanding balance of the 6.375% MTCH Senior Notes as of March 31, 2020 is $400.0 million.
|
•
|
5.00% MTCH Senior Notes - MTCH's 5.00% Senior Notes due December 15, 2027, with interest payable each June 15 and December 15. The outstanding balance of the 5.00% MTCH Senior Notes as of March 31, 2020 is $450.0 million.
|
•
|
5.625% MTCH Senior Notes - On February 15, 2019, MTCH issued $350 million aggregate principal amount of its 5.625% Senior Notes due February 15, 2029, with interest payable each February 15 and August 15. The outstanding balance of the 5.625% MTCH Senior Notes as of March 31, 2020 is $350.0 million.
|
•
|
4.125% MTCH Senior Notes - On February 11, 2020, MTCH issued $500 million aggregate principal amount of its 4.125% Senior Notes due August 1, 2030, with interest payable each February 1 and August 1, commencing August 1, 2020. The proceeds from the offering will be used to fund a portion of the cash consideration of $3.00 per MTCH common share that will be payable in connection with the Separation. If the Separation is not consummated, the proceeds will be used by MTCH for general corporate purposes.
|
•
|
ANGI Term Loan - due November 5, 2023. The outstanding balance of the ANGI Term Loan as of March 31, 2020 is $244.1 million. At both March 31, 2020 and December 31, 2019, the ANGI Term Loan bears interest at LIBOR plus 1.50% and has quarterly principal payments. The interest rate was 2.28% and 3.25% at March 31, 2020 and December 31, 2019, respectively.
|
•
|
ANGI Credit Facility - The ANGI $250 million revolving credit facility expires on November 5, 2023. At March 31, 2020 and December 31, 2019, there were no outstanding borrowings under the ANGI Credit Facility.
|
•
|
2022 Exchangeable Notes - On October 2, 2017, IAC FinanceCo, Inc., a subsidiary of the Company, issued $517.5 million aggregate principal amount of 0.875% Exchangeable Senior Notes due October 1, 2022, which are exchangeable into shares of the Company's common stock. Interest is payable each April 1 and October 1. The outstanding balance of the 2022 Exchangeable Notes as of March 31, 2020 is $517.5 million.
|
•
|
2026 Exchangeable Notes - During the second quarter of 2019, IAC FinanceCo 2, Inc., a subsidiary of the Company, issued $575.0 million aggregate principal amount of 0.875% Exchangeable Senior Notes due June 15, 2026, which are
|
•
|
2030 Exchangeable Notes - During the second quarter of 2019, IAC FinanceCo 3, Inc., a subsidiary of the Company, issued $575.0 million aggregate principal amount of 2.00% Exchangeable Senior Notes due January 15, 2030, which are exchangeable into shares of the Company's common stock. Interest is payable each January 15 and July 15. The outstanding balance of the 2030 Exchangeable Notes as of March 31, 2020 is $575.0 million.
|
•
|
IAC Credit Facility - The IAC $250 million revolving credit facility, under which IAC Group, LLC, a subsidiary of the Company, is the borrower, expires on November 5, 2023. At March 31, 2020 and December 31, 2019, there were no outstanding borrowings under the IAC Credit Facility.
|
•
|
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 a reconciliation of net earnings attributable to IAC shareholders to operating (loss) income to consolidated Adjusted EBITDA for the three months ended March 31, 2020 and 2019.
|
|
Three Months Ended March 31,
|
|||||||||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|||||||
|
(Dollars in thousands)
|
|||||||||||||
Revenue:
|
|
|
|
|
|
|
|
|||||||
Match Group
|
$
|
544,642
|
|
|
$
|
80,017
|
|
|
17
|
%
|
|
$
|
464,625
|
|
ANGI Homeservices
|
343,650
|
|
|
40,207
|
|
|
13
|
%
|
|
303,443
|
|
|||
Vimeo
|
56,968
|
|
|
13,387
|
|
|
31
|
%
|
|
43,581
|
|
|||
Dotdash
|
44,120
|
|
|
10,159
|
|
|
30
|
%
|
|
33,961
|
|
|||
Applications
|
104,148
|
|
|
(39,401
|
)
|
|
(27
|
)%
|
|
143,549
|
|
|||
Emerging & Other
|
135,305
|
|
|
18,557
|
|
|
16
|
%
|
|
116,748
|
|
|||
Inter-segment eliminations
|
(68
|
)
|
|
(4
|
)
|
|
(6
|
)%
|
|
(64
|
)
|
|||
Total
|
$
|
1,228,765
|
|
|
$
|
122,922
|
|
|
11
|
%
|
|
$
|
1,105,843
|
|
|
|
|
|
|
|
|
|
|||||||
Operating Income (Loss):
|
|
|
|
|
|
|
|
|
|
|||||
Match Group
|
$
|
134,681
|
|
|
$
|
15,853
|
|
|
13
|
%
|
|
$
|
118,828
|
|
ANGI Homeservices
|
(16,296
|
)
|
|
(12,655
|
)
|
|
(348
|
)%
|
|
(3,641
|
)
|
|||
Vimeo
|
(14,589
|
)
|
|
3,195
|
|
|
18
|
%
|
|
(17,784
|
)
|
|||
Dotdash
|
2,411
|
|
|
(636
|
)
|
|
(21
|
)%
|
|
3,047
|
|
|||
Applications
|
(218,588
|
)
|
|
(243,944
|
)
|
|
NM
|
|
|
25,356
|
|
|||
Emerging & Other
|
(19,845
|
)
|
|
(17,325
|
)
|
|
(687
|
)%
|
|
(2,520
|
)
|
|||
Corporate
|
(45,554
|
)
|
|
(2,141
|
)
|
|
(5
|
)%
|
|
(43,413
|
)
|
|||
Total
|
$
|
(177,780
|
)
|
|
$
|
(257,653
|
)
|
|
NM
|
|
|
$
|
79,873
|
|
|
|
|
|
|
|
|
|
|||||||
Adjusted EBITDA:
|
|
|
|
|
|
|
|
|||||||
Match Group
|
$
|
171,502
|
|
|
$
|
16,435
|
|
|
11
|
%
|
|
$
|
155,067
|
|
ANGI Homeservices
|
34,397
|
|
|
(2,782
|
)
|
|
(7
|
)%
|
|
37,179
|
|
|||
Vimeo
|
(11,408
|
)
|
|
4,792
|
|
|
30
|
%
|
|
(16,200
|
)
|
|||
Dotdash
|
7,011
|
|
|
(139
|
)
|
|
(2
|
)%
|
|
7,150
|
|
|||
Applications
|
10,151
|
|
|
(19,537
|
)
|
|
(66
|
)%
|
|
29,688
|
|
|||
Emerging & Other
|
(16,980
|
)
|
|
(14,885
|
)
|
|
(710
|
)%
|
|
(2,095
|
)
|
|||
Corporate
|
(31,398
|
)
|
|
(11,178
|
)
|
|
(55
|
)%
|
|
(20,220
|
)
|
|||
Total
|
$
|
163,275
|
|
|
$
|
(27,294
|
)
|
|
(14
|
)%
|
|
$
|
190,569
|
|
|
|
|
|
|
|
|
|
•
|
Revenue increased $122.9 million, or 11%, to $1.2 billion, due to growth from MTCH of $80.0 million and ANGI of $40.2 million, increases of $18.6 million from Emerging & Other, $13.4 million from Vimeo and $10.2 million from Dotdash, partially offset by a decrease of $39.4 million from Applications.
|
•
|
Operating income decreased $257.7 million to a loss of $177.8 million due primarily to a goodwill impairment of $212.0 million and $21.4 million in indefinite-lived intangible asset impairments, which is reflected in amortization of intangibles, at Applications related to the Desktop business, a decrease in Adjusted EBITDA of $27.3 million, described below, and an increase of $5.8 million in depreciation, partially offset by a decrease of $9.0 million in stock-based compensation expense and a change of $7.8 million in acquisition-related contingent consideration fair value adjustments (income of $6.3 million in 2020 compared to expense of $1.5 million in 2019). The overall increase in amortization of intangibles of $29.4 million was due primarily to the inclusion in 2020 of indefinite-lived intangible asset impairments of $21.4 million related to the Desktop business noted above, and $4.6 million at MTCH. The goodwill and the indefinite-lived
|
•
|
Adjusted EBITDA decreased $27.3 million, or 14%, to $163.3 million due primarily to decreases of $19.5 million from Applications and $2.8 million from ANGI, and increased losses of $14.9 million and $11.2 million from Corporate and Emerging & Other, respectively, partially offset by growth of $16.4 million from MTCH and $4.8 million from Vimeo.
|
Acquisitions:
|
|
Reportable Segment:
|
|
Acquisition Date:
|
Fixd
|
|
ANGI
|
|
January 25, 2019
|
Magisto
|
|
Vimeo
|
|
May 28, 2019
|
NurseFly - controlling interest
|
|
Emerging & Other
|
|
June 26, 2019
|
Care.com
|
|
Emerging & Other
|
|
February 11, 2020
|
Dispositions:
|
|
Reportable Segment:
|
|
Sale Date:
|
Vimeo's hardware business
|
|
Vimeo
|
|
March 29, 2019
|
College Humor Media
|
|
Emerging & Other
|
|
March 16, 2020
|
•
|
a $212.0 million impairment related to the goodwill of the Desktop reporting unit;
|
•
|
a $21.4 million impairment related to certain indefinite-lived intangible assets of the Desktop reporting unit;
|
•
|
a $4.6 million impairment related to certain indefinite-lived intangible assets of the Match Group reporting unit;
|
•
|
a $51.5 million impairment of certain equity securities without readily determinable fair values; and
|
•
|
a $7.5 million impairment of a note receivable and a warrant related to certain investees.
|
|
Three Months Ended March 31,
|
||||||||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
||||||
|
(Dollars in thousands)
|
||||||||||||
Match Group
|
$
|
544,642
|
|
|
$
|
80,017
|
|
|
17%
|
|
$
|
464,625
|
|
ANGI Homeservices
|
343,650
|
|
|
40,207
|
|
|
13%
|
|
303,443
|
|
|||
Vimeo
|
56,968
|
|
|
13,387
|
|
|
31%
|
|
43,581
|
|
|||
Dotdash
|
44,120
|
|
|
10,159
|
|
|
30%
|
|
33,961
|
|
|||
Applications
|
104,148
|
|
|
(39,401
|
)
|
|
(27)%
|
|
143,549
|
|
|||
Emerging & Other
|
135,305
|
|
|
18,557
|
|
|
16%
|
|
116,748
|
|
|||
Inter-segment eliminations
|
(68
|
)
|
|
(4
|
)
|
|
(6)%
|
|
(64
|
)
|
|||
Total
|
$
|
1,228,765
|
|
|
$
|
122,922
|
|
|
11%
|
|
$
|
1,105,843
|
|
•
|
MTCH revenue increased 17% to $544.6 million driven by International Direct Revenue growth of $55.3 million, or 26%, and North America Direct Revenue growth of $25.6 million, or 11%. Both International and North America Direct Revenue growth were driven by higher Average Subscribers, up 26% to 5.3 million and 5% to 4.6 million, respectively, due primarily to continued growth in Subscribers at Tinder and Hinge, with Pairs contributing to international growth. Total ARPU increased 1% driven by an increase of 5% in North America ARPU due to Tinder, driven primarily by increased purchases of à la carte features, partially offset by a 1% decrease in International ARPU due primarily to the unfavorable impact from the strengthening of the U.S. dollar relative to the Euro and certain other currencies.
|
•
|
ANGI revenue increased 13% to $343.6 million driven by Marketplace Revenue growth of $38.3 million, or 17%, and an increase of $3.9 million, or 6%, in Advertising & Other Revenue, partially offset by a decline of $1.9 million, or 9%, at the European businesses. The increase in Marketplace Revenue was due primarily to increases of 2% in Marketplace Service Requests to 5.9 million and 5% in Marketplace Transacting SPs to 191,000, and, to a lesser extent, an increase in revenue of $15.2 million due to the change to gross revenue reporting for Handy and HomeAdvisor’s pre-priced product offering, effective January 1, 2020. Advertising & Other Revenue increased due primarily to an increase in Angie's List revenue. The revenue decline at the European businesses was due primarily to the impact of COVID-19, lower monetization from transitioning the Travaux.com business to Werkspot's technology platform in early February 2020 and the unfavorable impact of the strengthening of the U.S. dollar relative to the Euro and British Pound.
|
•
|
Vimeo revenue grew 31% to $57.0 million due to Platform Revenue growth of $15.7 million, or 38%. Platform Revenue growth was driven by a 6% increase in average revenue per subscriber and a 31% increase in Vimeo Ending Subscribers to 1.3 million (including the contribution from Magisto, acquired May 28, 2019) as enterprises and organizations move to deliver their products and communicate with their customers more digitally due to the effects of COVID-19. Revenue in 2019 included $2.3 million from the hardware business, which was sold in the first quarter of 2019.
|
•
|
Dotdash revenue increased 30% to $44.1 million due to growth of 79% in Performance Marketing Revenue and 15% higher Display Advertising Revenue. The growth in Performance Marketing Revenue was due primarily to growth in both affiliate commerce commission revenue and performance marketing commission revenue.
|
•
|
Applications revenue decreased 27% to $104.1 million due to a decrease of $42.5 million, or 44%, at Desktop, partially offset by an increase of $3.1 million, or 7%, at Mosaic Group. The decrease in Desktop revenue was driven by lower queries and monetization challenges following prior year browser policy changes and a decrease in advertising rates due to the impact of COVID-19 as well as continued business-to-business partnership declines.
|
•
|
Emerging & Other revenue increased 16% to $135.3 million due primarily to the contributions from Care.com, acquired February 11, 2020, and Nursefly, acquired June 26, 2019, as well as growth at Ask Media Group and The Daily Beast, partially offset by lower revenue at IAC Films.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
Cost of revenue (exclusive of depreciation shown separately below)
|
$323,221
|
|
$63,150
|
|
24%
|
|
$260,071
|
As a percentage of revenue
|
26%
|
|
|
|
|
|
24%
|
•
|
The MTCH increase was due primarily to increases of $9.6 million in in-app purchase fees paid to Apple and Google as MTCH's revenues are increasingly sourced through mobile app stores, $7.9 million in web operations, including hosting fees, and $3.2 million in compensation expense related to increased customer care personnel.
|
•
|
The ANGI increase was due primarily to the change from net to gross revenue reporting for Handy and HomeAdvisor pre-priced product offering, effective January 1, 2020.
|
•
|
The Emerging & Other increase was due primarily to an increase of $10.9 million in traffic acquisition costs, principally due to an increase at Ask Media Group driven by higher revenue sourced through partners, and $9.4 million of expense from the inclusion of Care.com.
|
•
|
The Applications decrease was due primarily to a decrease of $4.5 million in traffic acquisition costs related to business-to-business partnership revenue declines at Desktop.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
Selling and marketing expense
|
$432,697
|
|
$10,837
|
|
3%
|
|
$421,860
|
As a percentage of revenue
|
35%
|
|
|
|
|
|
38%
|
•
|
The ANGI increase was due primarily to increases in compensation expense of $7.7 million and advertising expense of $4.4 million. The increase in compensation expense was due primarily to growth in the sales force. The increase in advertising expense was due primarily to an increase in online marketing, partially offset by a decrease in television spend. Beginning mid-way through 2019, the proportion of service requests through Google free traffic declined while service requests through Google paid traffic increased. In addition, paid service requests became considerably more expensive on average than in the first half of 2019. In response to this continuing trend, we implemented new processes in the second half of 2019 that are increasingly more focused on profitability targets of our paid customer acquisition than the cost of each service request. We expect the year-over-year increase in paid traffic to be more modest in the back half of 2020.
|
•
|
The MTCH increase was due primarily to increases in spending at Tinder, Pairs, OkCupid and Hinge, partially offset by decreases in spending at Match. Selling and marketing expense declined as a percentage of revenue as MTCH continues to generate revenue growth from brands with relatively lower marketing expense.
|
•
|
The Emerging & Other increase was due primarily to $9.9 million of expense from the inclusion of Care.com, partially offset by decreases in marketing of $6.2 million at Ask Media Group, driven by a shift in revenue resulting in the payment of traffic acquisition costs, and $0.9 million in compensation at College Humor Media due to its sale during the first quarter of 2020.
|
•
|
The Vimeo increase was due primarily to increases in compensation expense of $3.5 million, due, in part, to growth in the sales force and software license and maintenance costs of $0.6 million, partially offset by lower marketing of $2.3 million due to a brand campaign in 2019.
|
•
|
The Dotdash increase was due primarily to an increase in compensation expense of $1.6 million, due, in part, to growth in the sales force.
|
•
|
The Applications decrease was due primarily to lower online marketing of $15.4 million principally at Desktop as we continue to mitigate the negative impact on revenue from prior year browser policy changes, and a decrease of $0.8 million in compensation expense.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
General and administrative expense
|
$256,021
|
|
$42,405
|
|
20%
|
|
$213,616
|
As a percentage of revenue
|
21%
|
|
|
|
|
|
19%
|
•
|
The MTCH increase was due primarily to increases of $10.7 million in legal fees, $9.5 million in compensation expense related to an increase in headcount, $3.5 million in costs related to the Separation and an increase of $2.3 million in non-income taxes.
|
•
|
The ANGI increase was due primarily to an increase of $6.2 million in compensation expense and $3.5 million in bad debt expense due to higher Marketplace Revenue and the impact from COVID-19 on expected credit losses. The increase in compensation expense was due primarily to an increase of $4.4 million in stock-based compensation expense due primarily to the issuance of new equity awards since 2019 and an increase of $2.5 million in expense due to the modification charge related to the combination of the HomeAdvisor business and Angie's List ($10.4 million in 2020 compared to $7.9 million in 2019).
|
•
|
The Emerging & Other increase was due primarily to $6.7 million of expense from the inclusion of Care.com.
|
•
|
The Corporate increase was due primarily to higher professional fees, including $7.6 million in costs related to the Separation, partially offset by a decrease in stock-based compensation expense due primarily to the vesting of awards, partially offset by a net increase in modification charges.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
Product development expense
|
$105,733
|
|
$17,033
|
|
19%
|
|
$88,700
|
As a percentage of revenue
|
9%
|
|
|
|
|
|
8%
|
•
|
The Emerging & Other increase was due primarily to $4.9 million of expense from the inclusion of Care.com.
|
•
|
The Vimeo increase was due primarily to an increase of $4.5 million in compensation expense due primarily from the inclusion of Magisto and higher headcount.
|
•
|
The Dotdash increase was due primarily to an increase of $3.6 million in compensation expense due primarily to higher headcount and an increase in expense for contractors engaged in improving the user's experience.
|
•
|
The Applications increase was due primarily to an increase of $2.1 million in compensation expense due primarily to higher headcount at Mosaic.
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
Depreciation
|
$24,738
|
|
$5,767
|
|
30%
|
|
$18,971
|
As a percentage of revenue
|
2%
|
|
|
|
|
|
2%
|
|
Three Months Ended March 31,
|
||||||||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
||||||
|
(Dollars in thousands)
|
||||||||||||
Match Group
|
$
|
134,681
|
|
|
$
|
15,853
|
|
|
13%
|
|
$
|
118,828
|
|
ANGI Homeservices
|
(16,296
|
)
|
|
(12,655
|
)
|
|
(348)%
|
|
(3,641
|
)
|
|||
Vimeo
|
(14,589
|
)
|
|
3,195
|
|
|
18%
|
|
(17,784
|
)
|
|||
Dotdash
|
2,411
|
|
|
(636
|
)
|
|
(21)%
|
|
3,047
|
|
|||
Applications
|
(218,588
|
)
|
|
(243,944
|
)
|
|
NM
|
|
25,356
|
|
|||
Emerging & Other
|
(19,845
|
)
|
|
(17,325
|
)
|
|
(687)%
|
|
(2,520
|
)
|
|||
Corporate
|
(45,554
|
)
|
|
(2,141
|
)
|
|
(5)%
|
|
(43,413
|
)
|
|||
Total
|
$
|
(177,780
|
)
|
|
$
|
(257,653
|
)
|
|
NM
|
|
$
|
79,873
|
|
|
|
|
|
|
|
|
|
||||||
As a percentage of revenue
|
(14)%
|
|
|
|
|
|
7%
|
|
Three Months Ended March 31,
|
||||||||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
||||||
|
(Dollars in thousands)
|
||||||||||||
Match Group
|
$
|
171,502
|
|
|
$
|
16,435
|
|
|
11%
|
|
$
|
155,067
|
|
ANGI Homeservices
|
34,397
|
|
|
(2,782
|
)
|
|
(7)%
|
|
37,179
|
|
|||
Vimeo
|
(11,408
|
)
|
|
4,792
|
|
|
30%
|
|
(16,200
|
)
|
|||
Dotdash
|
7,011
|
|
|
(139
|
)
|
|
(2)%
|
|
7,150
|
|
|||
Applications
|
10,151
|
|
|
(19,537
|
)
|
|
(66)%
|
|
29,688
|
|
|||
Emerging & Other
|
(16,980
|
)
|
|
(14,885
|
)
|
|
(710)%
|
|
(2,095
|
)
|
|||
Corporate
|
(31,398
|
)
|
|
(11,178
|
)
|
|
(55)%
|
|
(20,220
|
)
|
|||
Total
|
$
|
163,275
|
|
|
$
|
(27,294
|
)
|
|
(14)%
|
|
$
|
190,569
|
|
|
|
|
|
|
|
|
|
||||||
As a percentage of revenue
|
13%
|
|
|
|
|
|
17%
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
Interest expense
|
$44,866
|
|
$13,723
|
|
44%
|
|
$31,143
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
Other (expense) income, net
|
$(49,893)
|
|
$(50,544)
|
|
NM
|
|
$651
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
Income tax benefit
|
$89,896
|
|
$26,292
|
|
41%
|
|
$63,604
|
Effective income tax rate
|
33%
|
|
|
|
|
|
NM
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
$ Change
|
|
% Change
|
|
2019
|
|
(Dollars in thousands)
|
||||||
Net earnings attributable to noncontrolling interests
|
$28,397
|
|
$4,107
|
|
17%
|
|
$24,290
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Net (loss) earnings attributable to IAC shareholders
|
$
|
(211,040
|
)
|
|
$
|
88,695
|
|
Add back:
|
|
|
|
||||
Net earnings attributable to noncontrolling interests
|
28,397
|
|
|
24,290
|
|
||
Income tax benefit
|
(89,896
|
)
|
|
(63,604
|
)
|
||
Other expense (income), net
|
49,893
|
|
|
(651
|
)
|
||
Interest expense
|
44,866
|
|
|
31,143
|
|
||
Operating (loss) income
|
(177,780
|
)
|
|
79,873
|
|
||
Stock-based compensation expense
|
58,464
|
|
|
67,444
|
|
||
Depreciation
|
24,738
|
|
|
18,971
|
|
||
Amortization of intangibles
|
52,162
|
|
|
22,752
|
|
||
Acquisition-related contingent consideration fair value adjustments
|
(6,282
|
)
|
|
1,529
|
|
||
Goodwill impairment
|
211,973
|
|
|
—
|
|
||
Adjusted EBITDA
|
$
|
163,275
|
|
|
$
|
190,569
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
|
(In thousands)
|
||||||
MTCH cash and cash equivalents:
|
|
|
|
||||
United States
|
$
|
695,552
|
|
|
$
|
322,267
|
|
All other countries
|
95,769
|
|
|
143,409
|
|
||
Total MTCH cash and cash equivalents
|
791,321
|
|
|
465,676
|
|
||
|
|
|
|
||||
ANGI cash and cash equivalents:
|
|
|
|
||||
United States
|
370,711
|
|
|
377,648
|
|
||
All other countries
|
13,519
|
|
|
12,917
|
|
||
Total ANGI cash and cash equivalents
|
384,230
|
|
|
390,565
|
|
||
|
|
|
|
||||
IAC (excluding MTCH and ANGI) cash and cash equivalents, short-term investments and marketable securities:
|
|
|
|
||||
United States
|
1,590,438
|
|
|
2,226,344
|
|
||
All other countries
|
56,740
|
|
|
56,710
|
|
||
Total cash and cash equivalents
|
1,647,178
|
|
|
2,283,054
|
|
||
Short-term investments (United States)
|
20,000
|
|
|
—
|
|
||
Marketable securities (United States)
|
49,912
|
|
|
19,993
|
|
||
Total IAC (excluding MTCH and ANGI) cash and cash equivalents, short-term investments and marketable securities
|
1,717,090
|
|
|
2,303,047
|
|
||
|
|
|
|
||||
Total cash and cash equivalents, short-term investments and marketable securities
|
$
|
2,892,641
|
|
|
$
|
3,159,288
|
|
MTCH debt:
|
|
|
|
||||
MTCH Term Loan
|
$
|
425,000
|
|
|
$
|
425,000
|
|
6.375% MTCH Senior Notes
|
400,000
|
|
|
400,000
|
|
||
5.00% MTCH Senior Notes
|
450,000
|
|
|
450,000
|
|
||
5.625% MTCH Senior Notes
|
350,000
|
|
|
350,000
|
|
||
4.125% MTCH Senior Notes
|
500,000
|
|
|
—
|
|
||
Total MTCH long-term debt
|
2,125,000
|
|
|
1,625,000
|
|
||
Less: unamortized original issue discount
|
6,618
|
|
|
6,282
|
|
||
Less: unamortized debt issuance costs
|
20,428
|
|
|
15,235
|
|
||
Total MTCH debt, net
|
2,097,954
|
|
|
1,603,483
|
|
||
|
|
|
|
||||
ANGI debt:
|
|
|
|
||||
ANGI Term Loan
|
244,063
|
|
|
247,500
|
|
||
Less: current portion of ANGI Term Loan
|
13,750
|
|
|
13,750
|
|
||
Less: unamortized debt issuance costs
|
1,670
|
|
|
1,804
|
|
||
Total ANGI debt, net
|
228,643
|
|
|
231,946
|
|
||
|
|
|
|
||||
IAC debt:
|
|
|
|
||||
2022 Exchangeable Notes
|
517,500
|
|
|
517,500
|
|
||
2026 Exchangeable Notes
|
575,000
|
|
|
575,000
|
|
||
2030 Exchangeable Notes
|
575,000
|
|
|
575,000
|
|
||
Total IAC long-term debt
|
1,667,500
|
|
|
1,667,500
|
|
||
Less: unamortized original issue discount
|
340,688
|
|
|
351,605
|
|
||
Less: unamortized debt issuance costs
|
28,401
|
|
|
29,752
|
|
||
Total IAC debt, net
|
1,298,411
|
|
|
1,286,143
|
|
||
|
|
|
|
||||
Total long-term debt, net
|
$
|
3,625,008
|
|
|
$
|
3,121,572
|
|
|
Three Months Ended March 31,
|
||||||
|
2020
|
|
2019
|
||||
|
(In thousands)
|
||||||
Net cash provided by (used in)
|
|
|
|
||||
Operating activities
|
$
|
80,975
|
|
|
$
|
102,941
|
|
Investing activities
|
(586,006
|
)
|
|
55,607
|
|
||
Financing activities
|
194,663
|
|
|
(73,660
|
)
|
•
|
MTCH will make a loan to IAC in an aggregate principal amount equal to the product of (i) $3.00 and (ii) the number of shares of MTCH capital stock outstanding immediately prior to the effective time of the Separation (the ‘‘Match loan’’). As part of the Separation, all MTCH stockholders, other than IAC, in respect of each share of MTCH common stock held, may elect to receive either $3.00 in cash or an additional $3.00 worth of New Match common stock. IAC will contribute the proceeds of the Match loan, less an amount equal to the product of $3.00 multiplied by the aggregate number of shares of MTCH capital stock in respect of which MTCH stockholders have made a valid cash election, to New IAC. Based on shares outstanding on March 31, 2020, New IAC will receive a contribution of approximately $685 million, assuming all non-IAC MTCH shareholders elect to receive $3.00 in cash and an additional amount of approximately $167 million if all non-IAC MTCH shareholders elect to receive additional MTCH shares. Following the Separation, the Match loan will remain as the obligation of New Match payable to MTCH; New IAC will not have any obligations with regards to the Match loan.
|
•
|
New Match will own certain IAC financing subsidiaries that are the issuers of approximately $1.7 billion aggregate principal amount of currently outstanding Exchangeable Notes.
|
•
|
New IAC’s debt immediately following the consummation of the Separation will relate solely to the ANGI Term Loan, which was $244.1 million as of March 31, 2020.
|
•
|
On February 11, 2020, MTCH issued $500 million aggregate principal amount of its 4.125% Senior Notes due August 1, 2030. The proceeds from the offering will be used to fund a portion of the cash consideration of $3.00 per MTCH common share that will be payable in connection with the Separation. If the Separation is not consummated, the proceeds will be used by MTCH for general corporate purposes.
|
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934 as adopted pursuant to Section 302 of the Sarbanes-Oxley Act. (1)
|
|
|
Certification of the Chairman and Senior Executive pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act. (2)
|
|
|
Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act. (2)
|
|
|
Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act. (2)
|
|
|
101.INS
|
Inline XBRL Instance (1)
|
The instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document.
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema (1)
|
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation (1)
|
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition (1)
|
|
101.LAB
|
Inline XBRL Taxonomy Extension Labels (1)
|
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation (1)
|
|
104
|
Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
|
|
(1)
|
Filed herewith.
|
(2)
|
Furnished herewith.
|
Dated:
|
May 8, 2020
|
|
|
|
|
|
IAC/INTERACTIVECORP
|
||
|
|
|
|
|
|
|
By:
|
|
/s/ GLENN H. SCHIFFMAN
|
|
|
|
|
Glenn H. Schiffman
|
|
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
|
Signature
|
Title
|
|
Date
|
|
|
|
|
/s/ GLENN H. SCHIFFMAN
|
Executive Vice President and
Chief Financial Officer
|
|
May 8, 2020
|
Glenn H. Schiffman
|
|
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the quarter ended March 31, 2020 of IAC/InterActiveCorp;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated:
|
May 8, 2020
|
|
/s/ BARRY DILLER
|
|
|
|
Barry Diller
Chairman and Senior Executive
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the quarter ended March 31, 2020 of IAC/InterActiveCorp;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
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5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated:
|
May 8, 2020
|
|
/s/ JOSEPH LEVIN
|
|
|
|
Joseph Levin
Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q for the quarter ended March 31, 2020 of IAC/InterActiveCorp;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Dated:
|
May 8, 2020
|
|
/s/ GLENN H. SCHIFFMAN
|
|
|
|
Glenn H. Schiffman
Executive Vice President & Chief Financial Officer
|
(1)
|
the Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020 of IAC/InterActiveCorp (the "Report") which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of IAC/InterActiveCorp.
|
Dated:
|
May 8, 2020
|
|
/s/ BARRY DILLER
|
|
|
|
Barry Diller
Chairman and Senior Executive
|
(1)
|
the Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020 of IAC/InterActiveCorp (the "Report") which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of IAC/InterActiveCorp.
|
Dated:
|
May 8, 2020
|
|
/s/ JOSEPH LEVIN
|
|
|
|
Joseph Levin
Chief Executive Officer
|
(1)
|
the Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020 of IAC/InterActiveCorp (the "Report") which this statement accompanies fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
|
(2)
|
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of IAC/InterActiveCorp.
|
Dated:
|
May 8, 2020
|
|
/s/ GLENN H. SCHIFFMAN
|
|
|
|
Glenn H. Schiffman
Executive Vice President & Chief Financial Officer
|