GlobeNewswire Inc | Aug 2, 2021 04:05PM EDT

August 02, 2021

-- Revenue Increased 34% Year-Over-Year to $105.1 Million -- Variable Marketing Margin Increased 40% Year-Over-Year to $32.8 Million -- Recently Announced PolicyFuel Acquisition Extends DTC Agency Strategy into P&C Verticals

CAMBRIDGE, Mass., Aug. 02, 2021 (GLOBE NEWSWIRE) -- EverQuote, Inc. (Nasdaq: EVER), a leading online insurance marketplace, today announced financial results for the second quarter ended June 30, 2021.

We delivered a strong second quarter 2021 with year-over-year increases in total revenue and Variable Marketing Margin, or VMM, of 34% and 40%, respectively. We generated increased Adjusted EBITDA and had our strongest Adjusted EBITDA margin since going public, said Jayme Mendal, CEO of EverQuote. With over 30% revenue growth in the first half of the year, we are making significant investments in our growth levers to build towards our vision of becoming the largest online source of insurance policies by using data and technology to make insurance simpler, more affordable and personalized, ultimately reducing cost and risk. We remain confident in our outlook for the remainder of this year and in our ability to build an industry-defining company.

After the quarter closed, EverQuote announced the acquisition of PolicyFuel LLC and its affiliated entities (PolicyFuel), which operates in property and casualty (P&C) insurance verticals, providing policy-sales-as-a-service (PSaaS) offerings to enable carriers to complement their own call center operations with access to dedicated advisor teams that focus exclusively on selling each providers offerings to its target customers.

PolicyFuels PSaaS offerings for P&C markets extends our existing Direct-To-Consumer Agency (DTCA) strategy in our Health and Life insurance verticals, where our tech-driven first-party distribution platforms have improved consumer experience, provider bind performance and our own monetization. PolicyFuel earns revenue based on policies sold and broadens EverQuotes ability to access the $135 billion commission component of our total addressable market. We are excited to welcome PolicyFuels founders and team to the EverQuote family, concluded Mr. Mendal.

Second Quarter 2021 Financial Highlights:(All comparisons are relative to the second quarter of 2020):

-- Total revenue of $105.1 million, an increase of 34%. -- Automotive insurance vertical revenue of $86.4 million, an increase of 34%. -- Revenue from our other insurance verticals, which includes home and renters, life, health and commercial insurance, increased 36% to $18.7 million. -- Variable Marketing Margin of $32.8 million, an increase of 40%. -- GAAP net loss decreased to $1.9 million, compared to GAAP net loss of $2.8 million. -- Adjusted EBITDA increased to $6.6 million, compared to Adjusted EBITDA of $4.0 million.

Second Quarter 2021 Business Highlights:

-- Consumer traffic initiatives focused on improving monetization led to a 34% year-over-year increase in revenue per quote request. -- Digital carriers continued to increase their spending on our platform, which grew by over 200% year-over-year. -- EverQuote continued building its leadership team, with Garett Kitch joining as SVP of Health and Life Agency Sales.

Third Quarter and Updated Full-Year 2021 Guidance:

EverQuote anticipates Revenue, Variable Marketing Margin and Adjusted EBITDA to be in the following ranges:

Third quarter 2021:

-- Revenue of $109 - $111 million, a year-over-year increase of 22% at the mid-point. -- Variable Marketing Margin of $33 - $34 million, a year-over-year increase of 14% at the mid-point. -- Adjusted EBITDA in the range of $4.5 - $5.5 million, a year-over-year decrease of 4% at the mid-point.

Full year 2021:

-- Revenue of $440 - $446 million, a year-over-year increase of 28% at the mid-point and an increase from our previous guidance of $434 - $442 million. -- Variable Marketing Margin of $138 - $141 million, a year-over-year increase of 28% at the mid-point and an increase from our previous guidance of $136 - $140 million. -- Adjusted EBITDA in the range of $23 - $26 million, a year-over-year increase of 33% at the mid-point and a decrease from our previous guidance of $26 - $30 million. Full year 2021 Adjusted EBITDA is expected to be impacted by incremental investments in preparation for this years health open enrollment period which takes place in the fourth quarter.

With respect to the Companys expectations under "Third Quarter and Updated Full Year 2021 Guidance" above, the Company has not reconciled the non-GAAP measure Adjusted EBITDA to the GAAP measure net income (loss) in this press release because the Company does not provide guidance for stock-based compensation expense,depreciation and amortization expense, acquisition-related costs, interest income, andincome taxes on a consistent basisas the Company is unable to quantify these amounts without unreasonable efforts, which would be required to include a reconciliation of Adjusted EBITDA to GAAP net income (loss). In addition, the Company believes such a reconciliation would imply a degree of precision that could be confusing or misleading to investors.

Conference Call and Webcast Information

EverQuote will host a conference call and live webcast to discuss its second quarter 2021 financial results at 4:30 p.m. Eastern Time today, August 2, 2021. To access the conference call, dial (877) 273-5005 for the U.S. or Canada, or (647) 689-5410 for international callers and provide conference ID 7777683. The webcast will be available live on the Investors section of the Company's website at https://investors.everquote.com.

An audio replay of the call will also be available to investors beginning at approximately 6:30 p.m. Eastern Time on August 2, 2021, until 11:59 p.m. Eastern Time on August 9, 2021, by dialing (800) 585-8367 for the U.S. or Canada, or (416) 621-4642 for international callers, and entering passcode 7777683. In addition, an archived webcast will be available on the Investors section of the Company's website at: https://investors.everquote.com.

Safe Harbor Statement

Any statements in this press release about future expectations, plans and prospects for EverQuote, Inc. (EverQuote or the Company), including statements about future results of operations or the future financial position of the Company, including financial targets, business strategy, plans and objectives for future operations and other statements containing the words anticipates, believes, expects, plans, and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: (1) the Companys ability to attract and retain consumers and insurance providers using the Companys marketplace; (2) the Companys ability to maintain or increase the amount providers spend per quote request; (3) the impact on the Company and the insurance industry of the COVID-19 pandemic; (4) the effectiveness of the Companys growth strategies and its ability to effectively manage growth; (5) the Companys ability to maintain and build its brand; (6) the Companys reliance on its third-party service providers; (7) the Companys ability to develop new and enhanced products and services to attract and retain consumers and insurance providers, and the Companys ability to successfully monetize them; (8) the impact of competition in the Companys industry and innovation by the Companys competitors; (9) the Companys expected use of proceeds from its initial public offering; (10) developments regarding the insurance industry and the transition to online marketing; (11) the Companys ability to successfully acquire and operate PolicyFuel; and (12) other factors discussed in the Risk Factors section of the Companys most recent Quarterly Report on Form 10-Q, which is on file with the Securities and Exchange Commission. In addition, the forward-looking statements included in this press release represent the Companys views as of the date of this press release. The Company anticipates that subsequent events and developments will cause the Companys views to change. However, while the Company may elect to update these forward-looking statements at some point in the future, the Company specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing the Companys views as of any date subsequent to the date of this press release.

About EverQuote

EverQuote operates a leading online insurance marketplace, connecting consumers with insurance providers. The company's mission is to empower insurance shoppers to better protect life's most important assetstheir family, property, and future. Our vision is to become the largest online source of insurance policies by using data and technology to make insurance simpler, more affordable and personalized, ultimately reducing cost and risk.

For more information, visit everquote.com and follow on Twitter @everquotelife, Instagram @everquotepics, and LinkedIn https://www.linkedin.com/company/everquote/.

Investor Relations Contact:Brinlea JohnsonThe Blueshirt Group212-331-8424Brinlea@blueshirtgroup.com

EVERQUOTE, INC.CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended Six Months Ended June June 30, 30, 2021 2020 2021 2020 (in thousands except per share) Revenue $ 105,063 $ 78,302 $ 208,885 $ 159,666 Cost and operating expenses(1):Cost of revenue 5,811 4,977 11,764 10,312 Sales and marketing 85,610 64,561 173,179 131,065 Research and development 9,053 6,966 17,626 13,425 General and administrative 6,200 4,754 11,796 9,473 Acquisition-related 265 ? 186 ? Total cost and operating 106,939 81,258 214,551 164,275 expensesLoss from operations (1,876 ) (2,956 ) (5,666 ) (4,609 )Other income (expense): Interest income 10 47 24 158 Other income (expense), (15 ) 101 (40 ) 201 netTotal other income (5 ) 148 (16 ) 359 (expense), netNet loss $ (1,881 ) $ (2,808 ) $ (5,682 ) $ (4,250 )Net loss per share, basic $ (0.07 ) $ (0.10 ) $ (0.20 ) $ (0.16 )and dilutedWeighted average commonshares outstanding, basic 28,895 27,136 28,665 26,888 and diluted (1) Amounts include stock-based compensation expense, as follows: Three Months Ended Six Months Ended June June 30, 30, 2021 2020 2021 2020 (in thousands) Cost of revenue $ 83 $ 88 $ 174 $ 142 Sales and marketing 2,459 2,547 5,850 4,242 Research and development 2,321 1,862 4,648 3,138 General and administrative 2,226 1,753 3,937 3,268 $ 7,089 $ 6,250 $ 14,609 $ 10,790

EVERQUOTE, INC.CONSOLIDATED BALANCE SHEET DATA

June 30, December 31, 2021 2020 (in thousands)Cash and cash equivalents $ 54,520 $ 42,870Working capital 61,387 50,554Total assets 138,843 129,050Total liabilities 57,188 58,068Total stockholders' equity 81,655 70,982

EVERQUOTE, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended Six Months Ended June June 30, 30, 2021 2020 2021 2020 (in thousands) Cash flows from operating activities:Net loss $ (1,881 ) $ (2,808 ) $ (5,682 ) $ (4,250 )Adjustments to reconcile netloss to net cash provided by operating activities:Depreciation and amortization 1,136 594 2,310 1,443 Stock-based compensation 7,089 6,250 14,609 10,790 expenseChange in fair value of (210 ) ? (289 ) ? contingent considerationProvision for (recovery of) (4 ) (4 ) (50 ) 17 bad debtUnrealized foreign currency 8 ? 23 ? transaction (gains) lossesChanges in operating assets and liabilities:Accounts receivable 3,239 (830 ) 297 (4,292 )Prepaid expenses and other (264 ) 3,730 (92 ) 3,636 current assetsOperating lease right-of-use 609 ? 1,400 ? assetsOther assets 393 (53 ) (340 ) (57 )Accounts payable (6,421 ) (690 ) (7,123 ) 3,293 Accrued expenses and other 4,728 (2,761 ) 7,538 (3,250 )current liabilitiesDeferred revenue 24 56 (33 ) 132 Operating lease liabilities (699 ) ? (1,337 ) ? Other long-term liabilities (32 ) 497 4 446 Net cash provided by 7,715 3,981 11,235 7,908 operating activitiesCash flows from investing activities:Acquisition of property andequipment, including costs (533 ) (986 ) (1,310 ) (1,871 )capitalized for developmentof internal-use softwareNet cash used in investing (533 ) (986 ) (1,310 ) (1,871 )activitiesCash flows from financing activities:Proceeds from exercise of 452 954 1,724 2,318 stock optionsNet cash provided by 452 954 1,724 2,318 financing activitiesEffect of exchange ratechanges on cash, cash ? ? 1 ? equivalents and restrictedcashNet increase in cash, cashequivalents andrestricted 7,634 3,949 11,650 8,355 cashCash, cash equivalents andrestricted cash at beginning 47,136 50,710 43,120 46,304 of periodCash, cash equivalents andrestricted cash at end of $ 54,770 $ 54,659 $ 54,770 $ 54,659 period

EVERQUOTE, INC.FINANCIAL AND OPERATING METRICS

Revenue by vertical: Three Months Ended June 30, Change 2021 2020 % (in thousands) Automotive $ 86,358 $ 64,594 33.7 %Other 18,705 13,708 36.5 %Total Revenue $ 105,063 $ 78,302 34.2 %

Six Months Ended June 30, Change 2021 2020 % (in thousands) Automotive $ 170,839 $ 132,235 29.2 %Other 38,046 27,431 38.7 %Total Revenue $ 208,885 $ 159,666 30.8 %

Otherfinancialandnon-financialmetrics:

Three Months Ended June Change 30, 2021 2020 % (in thousands) Loss from operations $ (1,876 ) $ (2,956 ) -36.5 %Net loss $ (1,881 ) $ (2,808 ) -33.0 %Quote requests 6,781 6,777 0.1 %Variable Marketing Margin $ 32,830 $ 23,478 39.8 %Adjusted EBITDA(1) $ 6,599 $ 3,989 65.4 %

Six Months Ended June 30, Change 2021 2020 % (in thousands) Loss from operations $ (5,666 ) $ (4,609 ) 22.9 %Net loss $ (5,682 ) $ (4,250 ) 33.7 %Quote requests 14,501 14,169 2.3 %Variable Marketing Margin $ 64,268 $ 47,293 35.9 %Adjusted EBITDA(1) $ 11,399 $ 7,825 45.7 %

(1) Adjusted EBITDA isanon-GAAPmeasure.Please see ?EverQuote, Inc. ReconciliationofNon-GAAPMeasuresto GAAP? below for more information.

EVERQUOTE, INC.NON-GAAPFINANCIALMEASURES

To supplement the Companys financial statements presented in accordance with GAAP and to provide investors with additional information regarding EverQuotes financial results, the Company has presented Adjusted EBITDA asanon-GAAPfinancialmeasure.Thisnon-GAAPfinancialmeasure is not based on any standardized methodology prescribed by GAAP and is not necessarily comparable to similarly titled measures presented by other companies.

The Company defines adjusted EBITDA as net income (loss), excluding the impact of stock-based compensation expense; depreciation and amortization expense; acquisition-related costs; interest income; and income taxes. The most directly comparable GAAP measure is net income (loss). The Company monitors and presents adjusted EBITDA because it is a key measure used by management and the board of directors to understand and evaluate operating performance, to establish budgets and to develop operational goals for managing EverQuotes business. In particular, the Company believes that excluding the impact of these items in calculating adjusted EBITDA can provide a useful measureforperiod-to-periodcomparisonsof EverQuotes core operating performance.

The Company uses adjusted EBITDA to evaluate EverQuotes operating performance and trends and make planning decisions. The Company believes thatthisnon-GAAPfinancialmeasure helps identify underlying trends in EverQuotes business that could otherwise be masked by the effect of the items that the Company excludes in the calculations of adjusted EBITDA. Accordingly, the Company believes that this financial measure provides useful information to investors and others in understanding and evaluating EverQuotes operating results, enhancing the overall understanding of the Companys past performance and future prospects.

TheCompanysnon-GAAPfinancialmeasures are not prepared in accordance with GAAP and should not be considered in isolation of, or as an alternative to, measures prepared in accordance with GAAP. There are a number of limitations related to the use of adjusted EBITDA rather than net income (loss), which is the most directly comparable financial measure calculated and presented in accordance with GAAP. In addition, other companies may use other measures to evaluate their performance, which could reduce the usefulness of theCompanysnon-GAAPfinancialmeasures as tools for comparison.

The following table reconciles adjusted EBITDA to net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP.

EVERQUOTE, INC.RECONCILIATIONOFNON-GAAPMEASURESTO GAAP

Three Months Ended June Six Months Ended June 30, 30, 2021 2020 2021 2020 (in thousands) Net loss $ (1,881 ) $ (2,808 ) $ (5,682 ) $ (4,250 )Stock-based compensation 7,089 6,250 14,609 10,790 Depreciation and 1,136 594 2,310 1,443 amortizationAcquisition-related 265 ? 186 ? Interest income (10 ) (47 ) (24 ) (158 )Adjusted EBITDA $ 6,599 $ 3,989 $ 11,399 $ 7,825