GlobeNewswire Inc | Nov 2, 2020 04:05PM EST

November 02, 2020

-- Revenue Increased 34% Year-Over-Year to $90.0 Million -- Non-Auto Insurance Revenue Increased 55% Year-Over-Year to $15.2 Million -- Variable Market Margin Expanded to a Record 33% of Total Revenue -- Company Raises Full Year 2020 Guidance

CAMBRIDGE, Mass., Nov. 02, 2020 (GLOBE NEWSWIRE) -- EverQuote, Inc. (Nasdaq: EVER), a leading online insurance marketplace, today announced financial results for the third quarter ended September 30, 2020.

Our strategy continues to yield excellent results and we reported a strong quarter across all of our key financial metrics delivering 34% year-over-year revenue growth and 41% year-over-year VMM growth, said Seth Birnbaum, CEO and Co-Founder of EverQuote. During the quarter, revenue from our non-auto insurance verticals, which includes home and renters, life, health and commercial insurance, grew 55% year-over-year. Our marketplace flywheel is demonstrating progress and resilience benefiting from increased diversity across our team, traffic, verticals, distribution and customer experiences including direct-to-consumer agency initiatives in Life and Health insurance. We continue to have strong momentum in the business, benefitting from the massive industry shift of nearly $150B of insurance distribution spend moving online, allowing us to end the year raising our full year 2020 guidance, concluded Mr. Birnbaum.

Third Quarter 2020 Financial Highlights:(All comparisons are relative to the third quarter of 2019 unless otherwise stated):

-- Total revenue of $90.0 million, an increase of 34%. -- Automotive insurance vertical revenue of $74.8 million, an increase of 30%. -- Revenue from our other insurance verticals, which includes home and renters, life, health and commercial insurance, increased 55% to $15.2 million. -- Variable Marketing Margin of $29.4 million, an increase of 41%. -- GAAP net loss of $3.2 million, compared to GAAP net income of $0.2 million. -- Adjusted EBITDA of $5.2 million, compared to Adjusted EBITDA of $3.9 million.

Third Quarter 2020 Business Highlights:

-- The Companys consumer traffic initiatives led to an 18% year-over-year increase in revenue per quote request and a 14% year-over-year increase in quote requests. -- More than 90% of revenue from carriers came from those who have been on our platform for more than a year. -- The Company obtained a deep level of integration with 72% of its carrier partners, improving the customer experience. -- On September 1, 2020, EverQuote completed the previously announced acquisition of Crosspointe Insurance & Financial Services, LLC, a leading health insurance agency headquartered in Evansville, Indiana.

Fourth Quarter and Increased Full-Year 2020 Guidance:

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

Fourth quarter 2020:

-- Revenue of $90.4 - $92.4 million. -- Variable Marketing Margin of $29.3 - $30.3 million. -- Adjusted EBITDA in the range of $4.0 - $5.0 million.

Full year 2020

-- Revenue of $340.0 - $342.0 million, an increase from our previous range of $331.0 - $336.0 million. -- Variable Marketing Margin of $106.0 - $107.0 million, an increase from our previous range of $101.0 - $104.5 million. -- Adjusted EBITDA in the range of $17.0 - $18.0 million, an increase from our previous range of $15.0 - $17.5 million.

With respect to the Companys expectations under "Fourth Quarter and Increased Full Year 2020 Guidance" above, the Company has not reconciled the non-GAAP measure Adjusted EBITDA to the GAAP measure net 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 and expense, andthe provision for (benefit from) income 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 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 third quarter 2020 financial results at 4:30 p.m. Eastern Time today, November 2, 2020. 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 8090489. 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 November 2, 2020, until 11:59 p.m. Eastern Time on November 9, 2020, by dialing (800) 585-8367 for the U.S. or Canada, or (416) 621-4642 for international callers, and entering passcode 8090489. 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; and (11) 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

EverQuoteoperates 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 use data and technology to make insurance simpler, more affordable and personalized ultimately reducing cost and risk.

For more information, visitEverQuote.comand follow on Twitter @EverQuoteInsure.

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

EVERQUOTE, INC.CONSOLIDATED STATEMENTS OF OPERATIONS

Three Months Ended Nine Months Ended September September 30, 30, 2020 2019 2020 2019 (in thousands except per share) Revenue $ 89,977 $ 67,112 $ 249,643 $ 175,012 Cost andoperating expenses(1):Cost of revenue 5,378 4,052 15,690 11,222 Sales and 73,598 53,212 204,663 143,358 marketingResearch and 8,149 5,596 21,574 14,685 developmentGeneral and 6,141 4,334 15,614 12,641 administrativeTotal cost andoperating 93,266 67,194 257,541 181,906 expensesLoss from (3,289 ) (82 ) (7,898 ) (6,894 )operationsOther income: Interest income 18 168 176 536 Other income 87 87 288 175 Total other 105 255 464 711 incomeNet income(loss) and $ (3,184 ) $ 173 $ (7,434 ) $ (6,183 )comprehensiveincome (loss)Net income(loss) per share:Basic $ (0.12 ) $ 0.01 $ (0.27 ) $ (0.24 )Diluted $ (0.12 ) $ 0.01 $ (0.27 ) $ (0.24 )Weighted averagecommon shares outstanding:Basic 27,526 25,910 27,102 25,596 Diluted 27,526 28,607 27,102 25,596 (1) Amounts includestock-based compensation expense, as follows: Three Months Ended Nine Months Ended September September 30, 30, 2020 2019 2020 2019 (in thousands) Cost of revenue $ 111 $ 52 $ 253 $ 139 Sales and 3,080 991 7,322 2,676 marketingResearch and 2,228 1,061 5,366 2,914 developmentGeneral and 1,781 1,165 5,049 3,528 administrative $ 7,200 $ 3,269 $ 17,990 $ 9,257

EVERQUOTE, INC.CONSOLIDATED BALANCE SHEET DATA

September 30, December 31, 2020 2019 (in thousands)Cash and cash equivalents $ 45,881 $ 46,054Working capital 47,876 46,944Total assets 116,235 91,221Total liabilities 49,012 39,451Total stockholders' equity 67,223 51,770

EVERQUOTE, INC.CONSOLIDATED STATEMENTS OF CASH FLOWS

Three Months Ended Nine Months Ended September 30, September 30, 2020 2019 2020 2019 (in thousands) Cash flows from operating activities:Net income (loss) $ (3,184 ) $ 173 $ (7,434 ) $ (6,183 )Adjustments to reconcilenet income (loss) to net cash provided by operatingactivities:Depreciation and 731 588 2,174 1,593 amortizationStock-based compensation 7,200 3,269 17,990 9,257 expenseProvision for (recovery (2 ) 57 15 479 of) bad debtChanges in operatingassets and liabilities, net of effects fromacquisition:Accounts receivable (5,036 ) (5,818 ) (9,328 ) (12,927 )Prepaid expenses and other (1,588 ) (1,781 ) 2,048 (1,754 )current assetsOther assets (165 ) (2 ) (222 ) (2 )Accounts payable 6,737 5,003 10,030 6,532 Accrued expenses and other 925 3,061 (2,325 ) 3,414 current liabilitiesDeferred revenue 59 (194 ) 191 127 Other long-term 318 (57 ) 764 (79 )liabilitiesNet cash provided by 5,995 4,299 13,903 457 operating activitiesCash flows from investing activities:Acquisition of propertyand equipment, includingcosts capitalized for (837 ) (646 ) (2,708 ) (2,198 )development ofinternal-use softwareAcquisition of business (14,930 ) ? (14,930 ) ? Net cash used in investing (15,767 ) (646 ) (17,638 ) (2,198 )activitiesCash flows from financing activities:Proceeds from exercise of 1,244 1,173 3,562 2,056 stock optionsNet cash provided by 1,244 1,173 3,562 2,056 financing activitiesNet increase (decrease) incash, cash equivalents (8,528 ) 4,826 (173 ) 315 andrestricted cashCash, cash equivalents andrestricted cash at 54,659 37,373 46,304 41,884 beginningof periodCash, cash equivalents andrestricted cash at end of $ 46,131 $ 42,199 $ 46,131 $ 42,199 period

EVERQUOTE, INC.FINANCIAL AND OPERATING METRICS

Revenue by vertical:

Three Months Ended September 30, Change 2020 2019 % (in thousands) Automotive $ 74,779 $ 57,306 30.5 %Other 15,198 9,806 55.0 %Total Revenue $ 89,977 $ 67,112 34.1 %

Nine Months Ended September 30, Change 2020 2019 % (in thousands) Automotive $ 207,014 $ 152,108 36.1 %Other 42,629 22,904 86.1 %Total Revenue $ 249,643 $ 175,012 42.6 %

Otherfinancialandnon-financialmetrics:

Three Months Ended September 30, Change 2020 2019 % (in thousands) Loss from operations $ (3,289 ) $ (82 ) NM Net income (loss) $ (3,184 ) $ 173 NM Quote requests 6,291 5,516 14.1 %Variable Marketing Margin $ 29,428 $ 20,912 40.7 %Adjusted EBITDA(1) $ 5,209 $ 3,862 34.9 %

Nine Months Ended September 30, Change 2020 2019 % (in thousands) Loss from operations $ (7,898 ) $ (6,894 ) 14.6 %Net loss $ (7,434 ) $ (6,183 ) 20.2 %Quote requests 20,460 14,148 44.6 %Variable Marketing Margin $ 76,721 $ 51,480 49.0 %Adjusted EBITDA(1) $ 13,034 $ 4,131 215.5 %

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

NMPercentage is not meaningful.

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 Nine Months Ended September 30, September 30, 2020 2019 2020 2019 (in thousands) Net income (loss) $ (3,184 ) $ 173 $ (7,434 ) $ (6,183 )Stock-based 7,200 3,269 17,990 9,257 compensationDepreciation and 731 588 2,174 1,593 amortizationAcquisition-related 480 ? 480 ? costsInterest income (18 ) (168 ) (176 ) (536 )Adjusted EBITDA $ 5,209 $ 3,862 $ 13,034 $ 4,131