Angie's List Short on Q2 Earnings

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Indianapolis-based Angie's List Inc. (Nasdaq: ANGI) is reporting a second quarter loss of $18 million, compared to a $14 million loss for the same period a year earlier. The company says revenue increased 33 percent, but fell short of expectations. July 24, 2014

News Release

INDIANAPOLIS, Ind. -- Angie's List, Inc. (Nasdaq:ANGI) announced today second quarter 2014 financial results for the quarter ended June 30, 2014.

"We reported solid results for the second quarter while continuing to invest in our marketplace," said Angie's List CEO Bill Oesterle. "We increased marketing spend during a seasonally strong period and had a record quarter in gross new member additions, which we believe reflects the continued resonance of our value proposition. While revenue growth in e-commerce was lower than expected, we continued to make progress against our strategy of enabling service providers and populating their stores with offers. We expect significant improvement in margin in the second half of the year and continue to see compelling opportunities for growth."

Second Quarter Results

Total revenue for the second quarter of 2014 was $78.9 million, an increase of 33 percent compared to the prior year period. Membership revenue in the second quarter of 2014 was $18.5 million, an increase of 16 percent compared to the prior year period. Service provider revenue remains the largest and fastest growing component of total revenue at $60.4 million for the quarter, representing a 39 percent growth rate year over year. Service provider revenue includes revenue from advertising contracts and fees from e-commerce transactions. Advertising revenue was $52.6 million in the second quarter of 2014, an increase of 37 percent compared to the prior year period, and e-commerce revenue was $7.8 million, an increase of approximately 57 percent year over year.

Marketing expense increased 28 percent, or $8.0 million, compared to the prior year period. Net loss for the quarter was $18.4 million, with selling expense of $30.3 million and marketing expense of $35.9 million, compared to a net loss of $14.3 million, with selling expense of $22.0 million and marketing expense of $28.0 million, in the prior year period. Adjusted EBITDA loss, a non-GAAP financial measure, was $14.9 million for the period as compared to a loss of $11.7 million achieved in the prior year period.

Cash provided by operations for the second quarter was approximately $2.6 million. At June 30, 2014, the balance of cash, cash equivalents and investments was $57.1 million.

About Angie's List

Angie's List helps facilitate happy transactions between more than 2.8 million consumers nationwide and its collection of highly-rated service providers in 720 categories of service, ranging from home improvement to health care. Built on a foundation of authentic reviews of local service, Angie's List connects consumers directly to its online marketplace of services from member-reviewed providers, and offers unique tools and support designed to improve the local service experience for both consumers and service professionals.

Source: Angie's List Inc.