NRDS 10-K & 10-Q changes, risk factors and insider trading

•If consumers or SMBs do not find value in our platform or do not like the consumer or SMB experience on our platform, the number of matches on our platform may decline, which would harm our business, financial condition and results of operations.

•Adverse conditions in the consumer or SMB finance markets, or poor or uncertain macroeconomic conditions, could harm our business, financial condition and results of operations if our financial services partners reduce their marketing budgets and decrease spending on our platform.

•Our business is subject to a variety of financial regulations in the U.S., UK, Canada and Australia,Canada, many of which are overlapping, ambiguous and still developing, which could subject us to claims or otherwise harm our business.

•SecurityCybersecurity incidents, or real or perceived errors, failures or bugs in our systems and platform could impair our operations, compromise our confidential information or our users’ personal information, damage our reputation and brand, and harm our business and operating results.

A significant portion of our success depends on the financial strength and underwriting standards of credit card issuers, lenders, insurers and other participants on our platform. If our financial services partners experience financial difficulties, they may cease participating on our platform or tighten underwriting standards, which would result in fewer opportunities for us to earn fees from matching consumers and SMBs with them. In times of financial difficulty, financial services providers may also fail to pay fees when due or drop the quality of their services to consumers.consumers and SMBs. Our partners could also change their online marketing strategies or implement cost-reduction initiatives that decrease spending through our platform. The occurrence of one or more of these events, alone or in combination, with a significant number of financial services partners could harm our business, financial condition and results of operations.

If consumers or SMBs do not find value in our platform or do not like the consumer or SMB experience on our platform, the number of matches on our platform may decline, which would harm our business, financial condition and results of operations.

While a key part of our business strategy is to engage users in our existing verticals, we also intend to expand our operations into new verticals.verticals, such as our brokerage and advisory businesses. In doing so, we may incur losses or otherwise fail to enter new verticals successfully. Our expansion into new verticals may place us in unfamiliar competitive environments and involve various risks, including competition, government regulation, the need to invest significant resources and the possibility that returns on such investments will not be achieved for several years or at all. There are many factors that could negatively affect our ability to grow our user base and engagement, including if:

•existing or new financial services providers use incentives to directly cross-sell their products, reducing consumer or SMB benefits of using multiple providers; or

Our reliance on internet search engines, particularly Google, for directing traffic to our platform, poses risks. Search engines, like Google, may modify algorithms or policies without prior notice, potentially resulting in significant declines in our organic search ranking and decreased platform traffic. Past changes have caused declines in traffic and user growth, with anticipated fluctuations in the future. The introduction and acceptance of AI-assisted technologies could further impact search engine relevance, causing declines in our ranking and decreased platform traffic, affecting our financial results.

InAdditionally, anticipationGoogle ofmay Google’stake deprecationaction ofagainst third-partywebsites advertisingfor cookies,behavior wedeemed haveto reducedunfairly theirinfluence usesearch sinceresults, 2022.without providing published guidelines. We are also exploring new audience targeting and measurement approaches and focusing on direct consumer or SMB connections through registration ramps to minimize reliance on search engines. Changes in our marketing approach and consumer and SMB relationships are ongoing, with uncertain outcomes on actionable marketing data. Negative effects on targeting consumers and SMBs would impact our ability to match them with financial services partners, posing a threat to our business, revenue, and financial results.

In order to attract consumers and SMBs to our platform and the products and services we provide and our platform,provide, convert these consumers and SMBs into matches with financial services partnerspartners, and generate repeat visits, we must market our platform and maintain consumer and SMB trust. Promoting and maintaining our brand requires the expenditure of considerable money and resources for online and offline marketing and advertising, the continued provision of high-quality products and services that meet user needs, the ability to maintain consumers’ and SMBs’ trust, and the ability to successfully differentiate our brand, products and services from those of our competitors.

Brand recognition is a key differentiating factor between us and our competitors. We believe that continuing to buildbuilding and maintainmaintaining the recognition of our brand is important to achieving increased traffic for our platform and demand for the products we provide. Accordingly,Historically, we have spent, and expect to continue to spend,spent significant amounts on, and devotedevoted significant resources to, branding, advertising and other marketing initiatives,initiatives. whichWe continually evaluate and optimize our marketing expenditures and resource commitments to improve efficiency and returns on investment. Changes in the mix, timing, channels, or level of our marketing activities may not be successfulas effective as anticipated in generating consumer or cost-effective.SMB Ourawareness, brand promotion activities may not generate consumer awarenessengagement, or yieldrevenue increasedgrowth. revenue,Even andwhen evenour ifmarketing theyinitiatives do,are successful, any increased revenue may not offset the expenses we incurincur. inIn buildingaddition, if our brand.marketing efforts are not effective or are insufficient to maintain or enhance brand awareness and consumer engagement, our brand recognition, competitive position, and results of operations could be adversely affected.

The strength of our brand may be harmed by adverse publicity from many sources. Adverse publicity and the potential corresponding impact on our reputation may be accelerated and amplified by the widespread use of social media platforms. Furthermore, adverse publicity, from legal proceedings against us or our business, including governmental proceedings and consumer class action or other litigation, or the disclosure of information from security breaches or other incidents, could negatively impact our reputation and our brand, which could materially and adversely affect our business andbusiness, financial conditioncondition, and results of operations.

The failure of our business to maintain or enhance its reputation and brand recognition and attract and retain consumers and SMBs in a cost-effective manner could materially and adversely affect our business, financial condition and results of operations.

We use social media, including Facebook, Instagram and TikTok, as well as affiliate marketing, email, and SMS as part of our multi-channel approach to marketing. Laws and regulations governing the use of these platformsplatforms, communication channels, and other digital marketing channels are rapidly evolving. An increase in the use of social media for product promotion and marketing may cause an increase in the burden on us to monitor compliance of such materials and increase the risk that such materials could contain problematic product or marketing claims in violation of applicable regulations. It may also become more difficult for us or our affiliate marketing partners to comply with such laws, and future data privacy and consumer protection laws and regulations or industry standards may alter, restrict or limit our ability to use some or all of the marketing strategies on which we currently rely. The failure by us, our employees, third parties acting at our direction or affiliate marketing partners who engage in advertising on our behalf to abide by applicable laws and regulations in the use of these platforms and communication channels could adversely impact our reputation or subject us to fines or other penalties. In addition, our employees or third parties, including our affiliate marketing partners, may knowingly or inadvertently make use of social media in ways that could lead to violations of marketing regulations issued by the FTC, SEC or CFPB. Any such inappropriate use of social media tools could also cause business interruptions and reputational damage.

For instance, our platform avoids the use of impression-based advertising, refrains from generating revenue through certain editorial content topics, and ensures the editorial team maintains independence from our business teams. Reviews and ratings of financial services products remain unbiased, unaffected by product placement on our platform or pricing agreements with financial services partners. Additionally, we may invest in products or features that may not yield immediate financial benefits but are expected to drive consumer and SMB engagement or offer potential long-term advantages.

We rely on certain third-party computer systems and third-party service providers for a variety of services, including cloud technology providers, third-party data providers, credit bureaus, data transfer networks, and remote and offshore engineering and other services to run our platform and support or carry out certain functions. Any significant disruption to the infrastructure of our third-party service providers and/or any changes in our third-party service providers’ service levels may significantly impact our business operations, including making our platform unavailable to our users. A lengthy interruption in the availability of our platform would result in a loss of matches with our financial partners and our ability to perform services, affecting corresponding revenue, which would impact our operating results and cash flow. In addition, it would negatively impact search engine ranking, user experience and our reputation with our financial partners.partners and providers. Furthermore, in the event that any of our agreements with our third-party service providers are terminated, we may experience significant costs or downtime in connection with the transfer to, or the addition of, new hostingservice providers. Although alternative providers could hostbe ourfound platformto on aprovide substantially similar basis,services, such transitiontransitions could potentially be disruptive and we could incur significant costs in connection therewith.

We currently compete with a number of companies that market financial services online, as well as with more traditional sources of financial information, and with financial institutions offering their products directly, and we expect that competition will intensify. Our online competitors include marketplaces such as Bankrate, Credit Karma, LendingTree, and Zillow, and we also face direct or indirect competition from providers of consumer personal finance guidance and online search engines. Some of these existing competitors may have more capital or complementary products or services than we do, and they may leverage their greater capital or diversification in a manner that adversely affects our competitive position, including by making strategic acquisitions. In addition, we also face the possibility of new competitors. New competitors may enter the market and may be able to innovate and bring products and services to market faster, or anticipate and meet consumerconsumer, SMB, or financial services partner demand before we do. Other newcomers, including major search engines and content aggregators, may be able to leverage their existing products and services or access to data to our disadvantage. We may be forced to expend significant resources to remain competitive with current and potential competitors. If any of our competitors are more successful than we are at attracting and engaging users or financial services partners, our business, financial condition and results of operations could be materially and adversely affected.

Our recent acquisition of NDL in October 2024 and our expansion into mortgage brokerage services introduce additional risks. We must comply with complex federal and state regulations governing mortgage brokerage operations, including licensing requirements for both the entity and individuals in the states where NDL operates. Maintaining and expanding relationships with wholesale lenders and credit facility providers is critical to NDL’s ability to offer competitive loan products. Successfully integrating NDL’s operations, technology, and personnel into NerdWallet’s broader platform while ensuring compliance with laws such as the GLBA and RESPA presents execution challenges. Our limited experience operating a mortgage brokerage business increases the importance of attracting and retaining licensed mortgage professionals while ensuring adherence to SAFE Act licensing requirements and evolving industry regulations. The CFPB and federal agencies such as the FHA and the VA continue to expand enforcement actions in mortgage origination, requiring robust compliance and risk management practices. Additionally, operating a direct mortgage brokerage alongside our existing mortgage marketplace comparison platform creates potential conflicts of interest that must be carefully managed to maintain transparency and trust with consumers and lending partners. Mortgage brokerage operations are highly sensitive to interest rate fluctuations, housing market conditions, and changes in wholesale lender policies, all of which could impact loan approvals, funding availability, and revenue generation. Given the competitive and highly regulated nature of the industry, our success will depend on effective execution, compliance, and maintaining consumer trust while navigating evolving market conditions. If we fail to effectively manage these risks, integrate NDL’s operations,risks or comply with applicable regulatory requirements, our business, financial condition, and results of operations could be materially and adversely affected.

Our international expansionoperations subjectssubject us to additional costs and risks which could harm our business, revenue and financial results, and ourany continuedfuture international expansion may be unsuccessful.

•financial and operational risks, such as longer payment cycles, difficulty collecting accounts receivable, and the impact of local and regional financial crises on demand and payment for our products;

•difficultieschallenges obtaining intellectual property protection, enforcing our intellectual property rights, and defending against third-party intellectual property infringement claims abroad;

•difficultiesexposure managingto fluctuations in foreign currency exchange rates and related foreign exchange controls; and

•potentially adverse tax consequences, including multiple and possibly overlapping tax regimes, the complexities of foreign value-added tax systems, and changes in applicable tax rates.

As we continue to expand our international operations, our success will depend in large part on ourOur ability to anticipate and effectively manage these risks,risks which in turn will requirerequires significant management attention and financial resources. In addition,Moreover, certain international markets wherein which we dooperate businessmay are subject to significantexperience economic uncertainty.or Significantpolitical economicuncertainty, developmentswhich incan these markets, orincrease the perception that anydifficulty of them could occur, creates further challenges for operating in thesethose markets. If we are unable to successfully manage any of these risks, our existing international operations — and any future international expansion we may pursue — could be compromised,negatively impacted, which could harm our business, financial conditioncondition, and results of operations.

Our financial performance is dependent on our ability to successfully refer users to and market financial services partners, and these partners are not precluded from offering products and services outside of our platform.

We believe our success depends on users finding our product offerings to be of value to them. Our ability to attract and engage users depends, in part, on our ability to successfully expand our product offerings and editorial articles. For example, we initially built our content and began matching consumers and SMBs with financial services providers in the credit card market, we later expanded into loan products and have continued to add other verticals since then. To penetrate new verticals, we will need to develop a deep understanding of those new markets and the associated business challenges faced by participants in them. Developing this level of understanding may require substantial investments of time and resources, and we may not be successful. In addition to the need for substantial resources, government regulation could limit our ability to introduce new product offerings. If we fail to penetrate new verticals successfully, our revenue may grow at a slower rate than we anticipate, and our business, financial condition and results of operations could be materially adversely affected. We must also continue to innovate and improve on our technology and product offerings in order to continue future growth and successfully compete with other companies in our markets, or our brand and future growth could be materially adversely affected.

In addition, the market for financial services products is rapidly evolving, fragmented and highly competitive. Competition in this market has intensified, and we expect this trend to continue as the list of financial services providers grows. There are many established and emerging technology centric financial services providers offering a multitude of products to consumers acrossand all financial verticals.SMBs. If we fail to successfully anticipate and identify new trends, products and emerging financial services providers, and provide up-to-date educational content, tools and other relevant resources timely, our ability to engage consumers and SMBs with financial services providers may suffer, which would harm our business, financial condition and results of operations.

Our operations are geographically limited and primarily dependent upon consumers and SMBs and economic conditions in the U.S. As a result of this geographical concentration, we are more vulnerable to downturns or other conditions that affect the U.S. economy. Any downturn or other adverse conditions in the U.S. economy could harm our business and financial results.

We havealso enteredoperate in the UK, CanadianUK and AustralianCanadian markets, and if we believecontinue our growth strategy depends, in part, on our continued international expansion. As weto expand internationally, we will be vulnerable to economic downturns or other conditions that affect the domestic markets in the countries where we expand. However, until our international operations grow significantly, we will continue to be primarily dependent on U.S. consumers and SMBs, and U.S. economic conditions.

We have less experience operating in some of the newer market verticals and productsservice offerings to which we have expanded.

We have expanded tointo several new verticals and productsservice offerings over the last several years.years, including mortgage brokering, insurance brokering, and wealth management services. We do not have as much experience withoperating in these newer areas as we do in our more established verticals. As a result, these newer verticals and products as we do with the other more established verticals on our platform. Accordingly, newer verticals and productsservices may be subject to greater risksrisks, operational challenges, and uncertainties than theour more establishedmature verticals on our platform.offerings.

The success of our entry into new verticals and productsservices will depend on a number of factors, including:

•ImplementingOur ability to implement in a cost effectivecost-effective manner product features and service experiences expected by consumersconsumers, SMBs and financial services providersproviders, including in regulated businesses such as mortgage and insurance brokering and investment advisory services;

•Market acceptance of an intermediary in these verticals by consumersconsumers, SMBs and financial services providers;

•Our ability to innovate and disrupt markets by offering or creating new and compelling products and services for consumers and SMBs;

•Our ability to attract and retain management and other skilled personnel with specialized expertise required for mortgage, insurance, and wealth management operation;

•Our ability to collect amounts owed to us from our financial services partners and customers, including in verticals with longer or more variable revenue cycles; and

•Our ability to timely adjust marketing expenditures in relation to changes in demand for the underlying products and services offered by us or our financial services partners in these newer verticals.partners.

OurIf we fail to successfully anticipate, manage, or mitigate the issues associated with expanding into these newer verticals and service offerings, our business, financial condition, and results of operations may suffer if we fail to successfully anticipate and manage these issues associated with expansion into new verticals.suffer.

We analyze first-party data from users, third-party data from financial account aggregators and credit reports to understand our users’ unique financial situations. The large amount of information we use in operating and improving our platform is critical to the experience we provide for our users. If we are unable to maintain, grow and efficiently handle the data provided to us, or if third parties are restricted by laws and regulations from providing us with such data, the value that we provide to consumers and SMBs, and the quality of matches with financial services partners may be limited. In addition, if we do not maintain the quality, accuracy and timeliness of this information, user experience may suffer, which would harm our business, financial condition and results of operations.

We have made acquisitions and established subsidiaries to expand into new verticals; to enter new markets and geographies; and to grow our platform so that our users have better outcomes. Our recentRecent acquisitions include:

•Next Door Lending. In October 2024, we acquired NDL,Next Door Lending LLC (NDL), a mortgage broker that offers a selection of loan products for home purchase and refinance, including cash-out refinance and debt consolidation, across a range of maturities and interest rates. Through NDL, we offer consumers access to government-sponsored entity-conforming loans, FHA insured loans, VA guaranteed loans and jumbo loans.

Non-GAAP operating income (loss): We define non-GAAP operating income (loss) as income (loss) from operations adjusted to exclude depreciation and amortization, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) change in fair value of contingent consideration related to earnouts, (4) deferred compensation related to earnouts, (5) acquisition-related costs, and (64) restructuring charges. We also reduce income from operations, or increase loss from operations, for capitalized internally developed software costs.

Adjusted EBITDA: We define adjusted EBITDA as net income (loss) from continuing operations adjusted to exclude depreciation and amortization, interest income (expense), net, other gains (losses), net, and provision (benefit) for income taxes, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) change in fair value of contingent consideration related to earnouts, (4) deferred compensation related to earnouts, (5) stock-based compensation, (64) acquisition-related costs, and (75) restructuring charges.

•Non-GAAP operating income (loss) and adjusted EBITDA exclude certain acquisition-related costs, including acquisition-related retention compensation under compensatory retention agreements with certain key employees, and acquisition-related transaction expenses, contingent consideration fair value adjustments related to earnouts, and deferred compensation related to earnoutsexpenses;

We generate substantially all of our revenue through fees paid by our financial services partners in the form of either revenue per action, revenue per click, revenue per lead, and revenue per funded loan arrangements. For these revenue arrangements, in which a partner pays only when a consumer or SMB satisfies the criteria set forth within the arrangement, revenue is recognized generally when we match the consumer or SMB with the financial services partner. For some of our arrangements, the transaction price is considered variable and an estimate of the constrained transaction price is recorded when the match occurs. Our revenue generally includes five product categories: Insurance, Credit cards, SMB products, Loans and Emerging verticals. Insurance revenue includes revenue from consumer insurance products, including auto, life and pet insurance. Credit cards revenue includes revenue from consumer credit cards. SMB products revenue includes revenue from loans, credit cards and other financial products and services intended for small and mid-sized businesses. Loans revenue includes revenue from personal loans, mortgages, student loans and auto loans. Emerging verticals revenue includes revenue from other product sources, including banking, investing and international.

Cost of revenue consists primarily of amortization expense associated with capitalized software development costs and developed technology intangible assets related to our acquisitions, credit scoring fees, account linking fees, and third-party data center costs. We expect our cost of revenue to decrease in absolute dollars in the next few years, as amortization of capitalized software development costs decline following years of decreasing levels of capitalized software development costs, and to then increase in absolute dollars for the foreseeable future to the extent that our business continues to grow. We expect our cost of revenue to vary as a percentage of revenue in the nearnext term,few years, and it may eventually decrease over time as a percentage of revenue as our business grows and recognizes economies of scale. However, this percentage may fluctuate from year to year depending on the timing and extent of our investments in experiences requiring third-party data, credit scoringservice and accountdata linking fees.costs.

We expect our sales and marketing expenses to continue to increase in absolute dollars for the foreseeable future, primarily to support the growth of our existing business and expansion into new verticals. Over time, we expect our sales and marketing expenses to decreaseincrease as a percentage of revenue as our business grows and recognizes economies of scale.expands. However, this percentage may fluctuate from period to period depending on the timing and extent of our sales and marketing expenses.

General and administrative expenses consist primarily of personnel relatedpersonnel-related costs, including stock-based compensation, for certain of our executives as well as our legal, finance, human resources, and other administrative employees; and professional services fees.

We expect our general and administrative expenses to increase in absolute dollars for the foreseeable future primarily to support the growth of our business. Additional expenses may include increased headcount,personnel-related costs, enhanced systems, processes, and controls as well as increased expenses in the areas of insurance, compliance, investor relations, and professional services. For these reasons, we expect general and administrative expenses to vary as a percentage of revenue in the near term, but eventually to decrease as a percentage of revenue as our business grows and recognizes economies of scale. This percentage may fluctuate from period to period depending on the timing and extent of our general and administrative expenses.

Our income from operations increased $5.8$55.8 millionmillion, or 161%590%, for 20242025 compared to 2023.2024. The increase was driven by ana $88.2$149.0 million increase in revenues, partially offset by ana $82.4$93.2 million increase in costs and operating expenses, primarily due to increasesa of $69.1$114.1 million increase in sales and marketing expenses andpartially $9.5offset by a $15.8 million decrease in costresearch ofand revenue.development expenses.

We hadOur net income ofincreased $30.4$18.3 millionmillion, or 60%, for 2024, as2025 compared to a2024, netprimarily lossdriven ofby $11.8the million for 2023. The change reflects a $5.8$55.8 million increase in income from operations, andas $4.4well as $3.0 million of other expense,income, net in 20242025 as compared to other income,expense, net of $2.7$4.4 million in 2023,2024, which were more thanpartially offset by a $25.4$19.5 million income tax benefitprovision in 20242025 as compared to an income tax provisionbenefit of $18.1$25.4 million in 2023.2024.

Revenue increased $88.2$149.0 million, or 15%,22%, for 20242025 compared to 2023,2024, driven by strong growth in InsuranceInsurance, productsEmerging revenueverticals asand well as SMB productsLoans revenues, partially offset by lower Credit cards, Loanscards and EmergingSMB verticals revenues.products.

Credit cards revenue decreased $33.3$43.0 million, or 16%,24%, for 20242025 compared to 2023,2024, primarily due to continued pressures in organic search traffic and reduced marketing spending by our financial services partners amidst a cautious underwriting environment.traffic.

SMB products revenue increaseddecreased $8.6$9.8 million, or 9%, for 20242025 compared to 2023,2024, primarily drivendue byto revenuecontinued growthpressures in productsorganic suchsearch as business credit cards, loan renewals and banking as we continue to scale our product offerings,traffic, partially offset by aan decreaseincrease in business loan originations.

Loans revenue decreasedincreased $17.1$48.9 million, or 17%,58%, for 20242025 compared to 2023,2024, primarily duedriven toby aan 32%85% decreaseincrease in personal loans revenue as wewell continue to work throughas a high33% interestincrease rate environment, partially offset by higherin mortgage loans revenue fromreflecting bothincorporation organic growth as well as incorporatingof our acquisition of NDL in October 2024.

Emerging verticals revenue decreasedincreased $16.6$63.7 million, or 12%,51%, for 20242025 compared to 2023,2024, primarily duedriven toby a 14%60% decreaseincrease in banking revenue asdue consumerto higher demand for banking products continued to moderate.products.

Cost of revenue increased $9.5$0.2 million, or 17%,million for 20242025 compared to 2023.2024. The increase was primarily attributable to increasesa of $6.5$2.1 million primarilyincrease related to third-party service charges and $3.9data millioncharges, in amortization expense related to capitalized software development costs, partiallysubstantially offset by a $1.6 million decrease in amortization expense related to intangiblecapitalized assets.software development costs.

Research and development expenses increaseddecreased $2.0$15.8 million, or 3%,19%, for 20242025 compared to 2023.2024. The increasedecrease was primarily attributable to a $5.8 million restructuring charge as well as a $1.8 million increase in software and technology costs related to our platform, partially offset by a $4.0$10.1 million decrease in personnel-related costs for our engineering, data, and product management personnel and contractors.contractors, as well as a $5.8 million restructuring charge in 2024.

We are able to adjust our marketing spend to reflect changes in external factors and consumer and SMB behavior.

Sales and marketing expenses increased $69.1$114.1 million, or 17%,24%, for 20242025 compared to 2023.2024. The increase was attributable to a $90.9$119.5 million increase in performance marketing expenses, partially offset by decreases of $15.8$3.5 million in brand marketing expenses and $6.0$1.9 million in organic and other marketing expenses primarily due to lower personnel-related costs partially offset by a $2.0 million restructuring charge.charge in 2024.

General and administrative expenses increaseddecreased $1.8$5.3 million, or 3%,9%, for 20242025 compared to 2023,2024, primarily attributable to a $1.2$5.5 million restructuringdecrease charge as well as higherin personnel-related costs mainly due to stock-based compensation.compensation, as well as a $1.2 million restructuring charge in 2024.

The change in other income (expense), net for 20242025 compared to 20232024 was primarily attributable to an $8.1 million impairment on an equity investment,investment in 2024, partially offset by higherlower interest income reflecting higherlower interest rates and average cash balances.

We had an income tax provision of $19.5 million for 2025, as compared to an income tax benefit of $25.4 million for 2024, as compared to an income tax provision of $18.1 million in 2023.2024. Our effective tax rate was 28.6% and (505.5%) and 286.7% for 20242025 and 2023,2024, respectively, as compared to the U.S. federal statutory income tax rate of 21%. Our effective tax rate for 2025 is higher than the U.S. federal statutory income tax rate of 21% primarily due to permanent impacts related to stock-based compensation and state taxes, partially offset by research and development credits. Our effective tax rate for 2024 differs from the U.S. federal statutory income tax rate of 21% primarily due to the decrease in the valuation allowance maintained against our net U.S. deferred tax assets. In the fourth quarter of 2024, we concluded that it is more likely than not that our net U.S. federal and majority state deferred tax assets are realizable, resulting in a valuation allowance release of $27.2 million. Our effective tax rate for 2023 differs from the U.S. federal statutory income tax rate of 21% primarily due to the valuation allowance previously maintained against our net U.S. deferred tax assets and state taxes, partially offset by research and development credits. Our tax benefit for 2023 primarily resulted from the requirement for us to capitalize and amortize research and development expenses, and an overall increase in our profitability before taxes. As a result, we recorded a significant U.S. current tax provision in 2023 with no corresponding deferred tax benefit for such capitalized expenses due to the valuation allowance maintained against our net U.S. deferred tax assets.

On February 20, 2026, we entered into a Membership Interest Purchase Agreement with inspHIRE IO Corp., d/b/a Candidly, pursuant to which we agreed to acquireacquired 100% of the outstanding membership interests of College Finance Company, LLC, which operates a student loan marketplace to connect borrowers with lenders. The preliminary purchase consideration for this acquisition was $17.2 million, of which $16.9 million in cash which was paid during the threesix months ended MarchJune 31,30, 20262026, including $1.5 million which was placed into escrow to secure potential post-closing indemnification rights.

AsDuring the three months ended March 31, 2026, as part of our ongoing efforts to align our operations with our strategic priorities, we have ceased revenue-generating operations outside of North America. We do not expect this action to have a material impact on our financial condition, results of operations or liquidity.

Non-GAAP operating income (loss): We define non-GAAP operating income (loss) as income (loss) from operations adjusted to exclude depreciation and amortization, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (32) acquisition-related costs, and (43) restructuring charges. We also reduce income from operations, or increase loss from operations, for capitalized internally developed software costs.

Adjusted EBITDA: We define adjusted EBITDA as net income (loss) from continuing operations adjusted to exclude depreciation and amortization, interest income (expense), net, other gains (losses), net, and provision (benefit) for income taxes, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (32) stock-based compensation, (43) acquisition-related costs, and (54) restructuring charges.

•Non-GAAP operating income (loss) and adjusted EBITDA exclude certain recurring, non-cash charges, such as amortization of software, depreciation of property and equipment, amortization of intangible assets, impairment of right-of-use asset, and (losses) gains on disposals of assets. Although these are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and non-GAAP operating income (loss) and adjusted EBITDA do not reflect all cash requirements for such replacements or for new capital expenditure requirements;

•Non-GAAP operating income (loss) and adjusted EBITDA exclude restructuring charges primarily consisting of severance payments, stock-based compensation, employee benefits, and related expenses for impacted employees, as well as contract termination costs, associated with our Restructuringrestructuring Planplan implemented in 2024;

Income from operations increaseddecreased $26.5$3.7 millionmillion, or 35%, for the three months ended MarchJune 31,30, 20262026, and increased $22.8 million, or 200%, for the six months ended June 30, 2026, compared to the three and six months ended MarchJune 31,30, 2025, as revenue increased $13.0$10.4 million and $23.4 million, respectively, while operating expenses decreasedincreased $13.5$14.1 million and $0.6 million, respectively, primarily attributable to aincreases $10.6of $17.4 million decreaseand $6.8 million in sales and marketing expenses.expenses, respectively, as well as a $2.0 million increase in general and administrative expenses for the six months ended June 30, 2026, partially offset by decreases of $3.2 million and $7.8 million in cost of revenues, respectively.

Net income increaseddecreased $20.2$3.9 millionmillion, or 48%, for the three months ended MarchJune 31,30, 20262026, and increased $16.3 million, or 195%, for the six months ended June 30, 2026, compared to the three and six months ended MarchJune 31,30, 2025, primarily driven by a $26.5$3.7 million decrease in income operations for the three months ended June 30, 2026 and a $22.8 million increase in income from operations,operations for the six months ended June 30, 2026, partially offset by a $6.5$6.2 million increase in income tax provision.provision for the six months ended June 30, 2026.

Revenue increased $13.0$10.4 million, or 6%, and $23.4 million, or 6%, for the three and six months ended MarchJune 31,30, 2026 compared to the three and six months ended MarchJune 31,30, 2025, respectively, as growth in Consumer revenue was partially offset by lower SMB revenue.

Consumer revenue increased $17.3$13.3 million, or 10%,8%, and $30.6 million, or 9%, for the three and six months ended MarchJune 31,30, 2026,2026 compared to the three and six months ended June 30, 2025, respectively, primarily driven by increases of $20.9$9.6 million and $30.5 million from deposit accountsaccounts, and $12.7 million from personal loansrespectively, as partners expanded budgets, and $12.3 million and $25.0 million from personal loans, respectively, as we expanded our marketplace offerings to serve a broader range of borrowers, partially offset by adecreases $12.5of $8.6 million decreaseand $21.1 million from consumer credit cardscards, respectively, primarily due to continued pressures in organic search traffic that have persisted for multiple quarters.

SMB revenue decreased $4.3$2.9 million, or 15%,11%, and $7.2 million, or 13%, for the three and six months ended MarchJune 31,30, 2026,2026 compared to the three and six months ended June 30, 2025, respectively, primarily due to continued pressures in organic search traffic, partially offset by an increaseincreases in business loan originations.

Cost of revenue decreased $4.6$3.2 million, or 26%,19%, and $7.8 million, or 22%, for the three and six months ended MarchJune 31,30, 2026,2026 compared to the three and six months ended June 30, 2025, respectively, primarily due to decreases of $3.0$3.5 million and $6.5 million, respectively, in amortization expense related to capitalized software development costscosts, andas well as a $1.8 million decrease related to third-party service and data charges.charges for the six months ended June 30, 2026.

Sales and marketing expenses decreasedincreased $10.6$17.4 million, or 7%,14%, and $6.8 million, or 2%, for the three and six months ended MarchJune 31,30, 2026 compared to the three and six months ended MarchJune 31,30, 2025, respectively, as aincreases $34.7in performance marketing expenses of $26.6 million decreaseand $50.7 million, respectively, were partially offset by decreases in other marketing expenses,expenses of $9.2 million and $43.9 million, respectively, primarily due to lower brand marketing expenses, was partially offset by a $24.1 million increase in performance marketing expenses.

General and administrative expenses increased $1.7$0.3 million, or 13%,1%, and $2.0 million, or 7%, for the three and six months ended MarchJune 31,30, 2026, as2026 compared to the three and six months ended MarchJune 31,30, 2025, with the increase for the six-month period primarily attributable to a $1.7$1.5 million increase in personnel-related costs.

Other income, net increaseddecreased $0.2$0.5 million, or 52%,59%, and $0.3 million, or 20%, for the three and six months ended MarchJune 31,30, 2026 compared to the three and six months ended MarchJune 31,30, 2025, respectively, primarily attributable to higherlower interest income reflecting higherlower average cash balances in interest-earning accounts.

The Company’s tax provision for interim periods is determined using an estimated annual effective tax rate which is adjusted for discrete items occurring during the period. We had income tax provisions of $7.6$3.0 million and $1.1$10.6 million for the three and six months ended MarchJune 31,30, 20262026, and $3.3 million and $4.4 million for the three and six months ended June 30, 2025, respectively. Our effective tax rate was 27.0%41.2% and 87.2%29.9% for the three and six months ended MarchJune 31,30, 20262026, and 28.9% and 34.5% for the three and six months ended June 30, 2025, respectively. Our effective tax rate for the three and six months ended MarchJune 31,30, 2026 differs from the U.S. federal statutory income tax rate of 21% primarily due to state taxestaxes, stock-based compensation and interest on uncertain tax positions. Our effective tax rate for the three and six months ended MarchJune 31,30, 2025 differed from the U.S. federal statutory income tax rate of 21% primarily due to discrete items related to stock-based compensation and uncertain tax positions.positions, partially offset by research and development credits.

We maintain a valuation allowance on our California deferred tax assets, which consist primarily of tax credits, as of MarchJune 31,30, 2026. Our judgment regarding the likelihood of realization of these deferred tax assets could change in future periods, which could result in a material impact to our income tax provision in the period of change.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations” for a discussion of the changes in income from operations and net income for the three and six months ended MarchJune 31,30, 2026 compared to the three and six months ended MarchJune 31,30, 2025.

Non-GAAP operating income increaseddecreased $24.4$8.5 million, or 262%,41%, and increased $15.9 million, or 53%, for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025, respectively, primarily due to a $3.7 million decrease in income from operations for the three months ended MarchJune 31,30, 2026 compared to the three months ended March 31, 2025, primarily driven byand a $26.5$22.8 million increase in income from operations,operations partiallyfor offsetthe bysix amonths $2.9ended millionJune decrease30, 2026, as well as the impacts of decreases in depreciation and amortization.amortization of $3.4 million and $6.3 million, respectively.

Our principal sources of liquidity to meet our business requirements and plans, both in the short-term (i.e., the next twelve months from MarchJune 31,30, 2026) and long-term (i.e., beyond the next twelve months), have historically been cash generated from operations. Our primary liquidity needs are related to the funding of general business requirements, including working capital requirements, research and development, and capital expenditures, as well as other liquidity requirements including, but not limited to, business combinations.

As of MarchJune 31,30, 2026 and December 31, 2025, we had cash and cash equivalents of $56.3$62.0 million and $98.3 million, respectively.

A description of contractual commitments as of MarchJune 31,30, 2026 is included in Note 6–Commitments and Contingencies in the notes to our condensed consolidated financial statements.

More broadly, we also have purchase obligations under contractual arrangements with vendors and service providers, including for certain web-hosting and cloud computing services and advertising, which do not qualify for recognition on our condensed consolidated balance sheets but which we consider non-cancellable. During the threesix months ended MarchJune 31,30, 2026, there have been no material changes in our purchase obligations as disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations–Liquidity and Capital Resources” in our Annual Report on Form 10-K for the year ended December 31, 2025.

Share Repurchase Program: We maintain a plan,share repurchase program under which we may purchase shares of our Class A common stock (the Repurchase Program), originally authorized by our Board of Directors in May 2023 withand subsequentsubsequently increased through additional share repurchase authorizations asfrom approvedtime byto time. In February 2026, our Board of Directors,Directors includingapproved aan increase of $100.0 million additionalto sharethe repurchaseamount authorizationauthorized announcedfor on February 25, 2026,repurchases under which we may repurchase shares of our Class A common stock (collectively, the Repurchase Program).Program. Subject to market conditions and other factors, the Repurchase Program is intended to make opportunistic repurchases of our Class A common stock to reduce our outstanding share count. Under the Repurchase Program, shares of Class A common stock may be repurchased in the open market through privately negotiated transactions or otherwise, in accordance with applicable securities laws and other restrictions. The Repurchase Program does not have fixed expiration dates and does not obligate us to acquire any specific number of shares. The timing and terms of any repurchases are at management’s discretion and depend on a variety of factors, including business, economic and market conditions, regulatory requirements, prevailing stock prices and other considerations. Additionally, we may, from time to time, enter into Rule 10b5‑1 trading plans to facilitate repurchases. Shares repurchased under the Repurchase ProgramsProgram are retired. We expect to fund repurchases with existing cash and cash equivalents. We repurchased 6.08.7 million shares of Class A common stock for $66.2$89.2 million, including costs associated with the repurchases, during the threesix months ended MarchJune 31,30, 2026. Additionally, we paid $0.4 million of excise taxes during the threesix months ended MarchJune 31,30, 2026 which related to previous share repurchases.

Credit Facility: We, including three of our wholly-owned subsidiaries, maintain a credit agreement (the Credit Agreement) with JPMorgan Chase Bank, National Association, as Administrative Agent, and a syndicate of lenders. The Credit Agreement provides for a $125.0 million senior secured revolving credit facility (the Credit Facility), with the option to increase up to an additional $75.0 million, and is available to be used by us and certain of our domestic subsidiaries for general corporate purposes, including acquisitions. The Credit Facility matures on September 26, 2028. We had no outstanding balance on our Credit Agreement as of MarchJune 31,30, 2026 or December 31, 2025. The available amount to borrow under our Credit Agreement was $124.5 million at both MarchJune 31,30, 2026 and December 31, 2025, which was equal to the available amount under the creditCredit agreementAgreement of $125.0 million, net of letters of credit of $0.5 million. Our Credit Agreement contains certain customary financial and non-financial covenants. We were in compliance with all covenants as of MarchJune 31,30, 2026 and December 31, 2025.

Warehouse Line of Credit: Next Door Lending LLC (NDL), a wholly-owned subsidiary, maintains a $15.0 million warehouse line of credit, which may be increased to $18.75 million for up to 90 days subject to certain requirements, to provide NDL short-term funding for mortgage loans originated for sale. Borrowings under the warehouse line of credit bear interest at the greater of the interest rate of the underlying mortgage loans held for sale, subject to a 5.25% minimum rate, and are secured by the underlying promissory notes of the mortgage loans held for sale, as well as NDL’s other assets. The warehouse line of credit matures on February 1, 2027. NDL had $14.9$5.1 million outstanding under the warehouse line of credit as of MarchJune 31,30, 2026, which is included in accrued expenses and other current liabilities on our condensed consolidated balance sheet. The warehouse line of credit requires NDL to comply with certain minimum tangible net worth, liquidity, and insurance requirements. NDL was in compliance with all covenants as of MarchJune 31,30, 2026 and December 31, 2025.

Net cash provided by operating activities increased $9.0$32.7 million for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025, driven by aincreases $20.2of $16.3 million increase in net income,income and $3.0 million in non-cash charges, as well as a $2.4$10.0 million increase in non-cash charges, partially offset by a $13.6 million increase in net cash outflowinflow from changes in operating assets and liabilities.liabilities for the six months ended June 30, 2026 as compared to a $3.4 million net cash outflow for the six months ended June 30, 2025. The increase in non-cash charges was primarily due to aan $5.7$11.8 million increase in deferred taxes, partially offset by adecreases $2.9of $6.3 million decrease in depreciation and amortization.amortization, $1.0 million in stock-based compensation, and $1.0 million in other losses, net. The increasechange into net cash outflowinflow from changes in operating assets and liabilities was primarily due to increases of $17.4 million for accounts payable and $12.0 million for accrued expenses and other current liabilities, partially offset by a $17.1$1.8 million decrease in mortgage loans held for accountssale receivable.for the six months ended June 30, 2026, as compared to a $9.0 million increase for the six months ended June 30, 2025.

Net cash used in investing activities increased $15.1$9.7 million for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025, primarily due to $15.8an $11.1 million ofincrease in cash paid for an acquisition in the three months ended March 31, 2026.acquisitions.

We had net cash used in financing activities of $57.9$89.4 million for the threesix months ended MarchJune 31,30, 2026, as compared to net cash provided by financing activities of $3.8$8.9 million for the threesix months ended MarchJune 31,30, 2025, with the change primarily due to $66.0an $88.5 million ofincrease in repurchases of Class A common stockstock, inas well as $1.7 million of net repayment on our warehouse line of credit for the threesix months ended MarchJune 31,30, 2026.2026 as compared to $8.7 million of net borrowing for the six months ended June 30, 2025.

During the threesix months ended MarchJune 31,30, 2026, there have been no material changes in our critical accounting policies as disclosed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations–Critical Accounting Policies and Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2025.