Q3 2025 QuinStreet Inc Earnings Call
Thank you for joining us.
Speaker Change: Joining me on the call today are Chief Executive Officer, Doug Valenti, and Chief Financial Officer, Greg Wong.
Speaker Change: Before we begin I would like to remind you that the following discussion will contain forward looking statements.
Speaker Change: Are we looking statements involve a number of risks and uncertainties that may cause actual results to differ materially from those projected by such statements and are not guarantees of future performance.
Speaker Change: There's that may cause results to differ from our forward looking statements are discussed in our recent SEC filings, including our most recent 8-K filing made today and our most recent 10-Q filings.
Speaker Change: Forward looking statements are based on assumptions as of today and the company undertakes no obligation to update these statements.
Speaker Change: Today, we will be discussing both GAAP and non-GAAP measures a reconciliation of GAAP to non-GAAP financial measures is included in today's earnings press release, which is available on our Investor Relations website at Investor <unk> Dot com.
Doug Blend: I will turn the call over to Doug blend. Please.
Speaker Change: Please go ahead Sir.
Doug Valenti: Thank you Rob.
Speaker Change: Welcome everyone.
Speaker Change: We delivered strong results again in the March quarter, our fiscal Q3.
Speaker Change: Growing revenues, 60% year over year.
Speaker Change: And adjusted EBITDA, 145%.
Speaker Change: Financial services client vertical revenue grew 78% year over year with auto insurance up 165%.
Speaker Change: Home services revenue grew 21% year over year to a new quarterly record.
Speaker Change: The continued strong results are due to the combination of our big market opportunities.
Speaker Change: Exceptional value proposition.
Speaker Change: And strong competitive advantages.
Speaker Change: And two our execution focused culture.
Speaker Change: As always our results include investments in a long list of high impact new product media and client expansion initiatives to fuel future performance.
Speaker Change: We expect to be able to continue to average double digit year over year revenue and profit growth in the short and long term.
Speaker Change: We strengthened our financial position further in fiscal Q3, ending the quarter with over $80 million in cash and no bank debt.
Speaker Change: Growing cash flow and expanding margins continue to be top priorities and areas of active focus.
Speaker Change: Turning to our outlook.
Speaker Change: We are maintaining our full fiscal year 2025 outlook as we move into the June quarter.
Speaker Change: Our fiscal Q4.
Speaker Change: Full fiscal year revenue is expected to be between 1.065 and $1.105 billion.
Speaker Change: Implying revenue growth of at least 18% year over year in fiscal Q4.
Speaker Change: Okay.
Full fiscal year adjusted EBITDA is expected to be between 80 and $85 million.
Speaker Change: Applying adjusted EBITDA growth of at least 89% year over year in fiscal Q4.
Speaker Change: The implied outlook range for fiscal Q4 is wider than our usual outlook range.
Speaker Change: Reflecting our view that tariffs.
Speaker Change: And tariff related uncertainties introduced risk.
Speaker Change: And the potential volatility to client spending.
Speaker Change: We are enthusiastic about our prospects short and long term.
Speaker Change: We will continue to position Quint street to be resilient to a wide range of macroeconomic scenarios.
Speaker Change: And to thrive as we pursue our big market opportunities.
Speaker Change: And we will prioritize expansion cash flow management.
Speaker Change: Margin expansion in.
Speaker Change: And maintaining a strong balance sheet.
Speaker Change: With that.
Speaker Change: I turn the call over to Greg.
Speaker Change: Thank you Doug.
Greg Wong: Hello, and thanks to everyone for joining us today.
Greg Wong: Fiscal Q3 was another strong quarter for Quint Street.
Greg Wong: We delivered double digit revenue growth year over year and continue to make progress on our profitability initiatives.
Greg Wong: Further strengthening our financial position and highlighting the strong leverage in our business.
Greg Wong: So the March quarter total revenue grew 60% year over year.
Greg Wong: It was $269.8 million.
Greg Wong: Adjusted net income was $12 $4 million or 21 cents per share.
Greg Wong: And adjusted EBITDA was $19 $4 million.
Greg Wong: Looking at revenue by client vertical.
Greg Wong: Our financial services client vertical represented 74% of Q3 revenue and grew 78% year over year to $199 $7 million.
Greg Wong: The strong performance was largely driven by auto insurance, which grew 165% year over year.
Greg Wong: Our home services client vertical represented 24% of Q3 revenue and grew 21% year over year to $65 $4 million.
Greg Wong: A record quarter for that business.
Greg Wong: Other revenue was the remaining $4 $7 million of Q3 revenue.
Greg Wong: Turning to the balance sheet, we closed the quarter with $82 million of cash and equivalents.
Greg Wong: And no bank debt.
Greg Wong: Moving to our outlook.
Greg Wong: We are maintaining our full fiscal year 2025 expectations.
Greg Wong: Full fiscal year revenue is expected to be between 1.065 and $1 one zero.
Greg Wong: But $1 billion.
Greg Wong: The full fiscal year adjusted EBITDA is expected to be between 80 and $85 million.
Speaker Change: As Doug noted the implied outlook range for fiscal Q4 is wider than our usual outlook range.
Speaker Change: I think our view that tariff and tariff related uncertainties.
Speaker Change: Introduces risk and potential.
Volatility the client spending.
Speaker Change: As a reminder, our full fiscal year outlook implies continued margin expansion in fiscal Q4.
Speaker Change: We continue to one optimize media efficiencies and client results in auto insurance.
Speaker Change: To grow higher margin growth opportunities.
Speaker Change: And three continue ongoing productivity improvements across our business.
Speaker Change: Yeah.
Speaker Change: Taking a step back.
Speaker Change: The fundamentals of our business have never been better.
Speaker Change: We expect Red Oak in fiscal 'twenty five.
Speaker Change: To grow over $1 billion.
Speaker Change: We're up at least 74% from just over $600 million in fiscal 'twenty four.
Speaker Change: While we expect adjusted EBITDA in fiscal 'twenty, five to grow even faster than revenue to at least $80 million.
Speaker Change: Or are at least 293% from $20 million in fiscal 'twenty four.
Speaker Change: Our market opportunities.
Speaker Change: Never been bigger and our competitive advantages have never been stronger.
Speaker Change: Importantly, we strengthened both our financial and strategic position for the future.
Speaker Change: Well, we remain confident with our ability to perform regardless of the macroeconomic environment.
Speaker Change: With that I'll turn it over to the operator for Q&A.
Speaker Change: Thank you ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press the star followed by the number one on your Touchtone phone you will hear a problem that you had the Hoffman rate should you wish to decline from the phone. Please press the star followed by the number of kids if you're are you.
Speaker Change: We're gonna Speaker phone please lift the handset before pressing any key one moment. Please for your first question.
Speaker Change: Your first question comes from the line of Jason <unk> from Craig Hallum.
Speaker Change: Line is now open. Please go ahead.
Speaker Change: Great. Thank you guys. This is Kyle on for Jason. So maybe first can you just provide some insight into your conversations with auto carriers and just your view on if they can absorb some of this pressure on profitability.
Speaker Change: Potentially take rate just kind of the runway that they might have there to absorb any of these tariff pressures.
Speaker Change: Yeah Kyle.
Speaker Change: Our conversations are much different than the auto carrier executives have stated publicly.
Speaker Change: The big ones in fact and that is that the.
Speaker Change: Tariffs if fully implemented.
Speaker Change: Are likely to have a negative effect on the loss ratios because they could increase claim costs.
Speaker Change: That said.
Speaker Change: They also entered this period or are performing during this period with exceptionally strong.
Speaker Change: Strongly positive.
Speaker Change: Combined ratios.
Speaker Change: And could likely absorb a very wide range of actual tariff.
Speaker Change: Implementations.
Speaker Change: And still being in a very good financial shape.
Speaker Change: The problem everybody has is none of us really know exactly what is and isn't going to be implemented at what rate and where.
Speaker Change: So with the right now.
Speaker Change: We have seen no material reductions from any of the clients.
Speaker Change: And any of the verticals, including auto insurance.
Speaker Change: Based on spending based on I'm, sorry, based on tariffs and care planning.
Speaker Change: And it's a little bit of a wait and see because I think we have also not seen.
Speaker Change: As strong a ramps as we might see.
Kevin: It's Kevin these strong financial results and economics of clients are.
Speaker Change: Delivering.
Speaker Change: We would expect even stronger ramps in this and we're not seeing that yet and I think that's because folks are kind of in wait and see mode.
Speaker Change: And wanting to know more about what exactly is going to happen with the tariffs before making.
Speaker Change: Decisions to be even more aggressive I would expect if in aggregate tariff Eric clears youre going to see a lot of aggressive more aggressiveness again, given the very strong operating and financial results of the carriers are reporting.
Speaker Change: But again.
Speaker Change: Seeing kind of just stays.
Speaker Change: Stable.
Speaker Change: Mode, just a stable spend right now.
Speaker Change: Great. Thanks, and then just maybe as a follow up we saw some nice EBIT margin improvement in the quarter and you're guiding to another healthy uptick here in Q4. So just curious how youre approaching margin expansion versus investments in the business and the different levers that you have to sustain that margin improvement.
Speaker Change: Yeah, It's a great question where continued.
Speaker Change: Invest very aggressively as I indicated in my script.
Speaker Change: And new growth initiatives as we always do it's the vast majority are really about our operating expenses are going toward.
Speaker Change: Future growth and margin expansion initiatives.
Speaker Change: The margin expansion.
Speaker Change: They just across the board opportunities that we are executing against let me give you. Some examples though it's a it's a fair question first and foremost of course is topline leverage our media margins come into it.
Speaker Change: As revenue grows and our revenue grows a lot faster than our fixed or semi fixed cost base. So you have a natural upward tug.
Speaker Change: On adjusted EBITDA as we continue to grow revenue and we expect to continue to grow revenue double digits and of course, we don't do not expect to continue to grow operating expenses.
Speaker Change: At the same rate.
Speaker Change: Second, though we have a lot of new media initiatives that are showing a lot of success. We are for example grew.
Speaker Change: Going big new skill areas are proprietary media.
Speaker Change: Across the company and.
Speaker Change: And especially in auto insurance.
Speaker Change: That proprietary media has grown very rapidly is now about half of our media margin or margin dollars producer media and auto insurance.
Speaker Change: And it comes in at about two times the margin of our third party media sources. We are still completely committed to third party media keeps us keeps us aware of the market that gives us a lot of insight we are a great partner for those third party providers.
Speaker Change: That proprietary media growth, which is a big initiative that the company is showing great success, great growth and great margin and we've got a lot lot more runway to go there.
Speaker Change:
Speaker Change: So that's a big one we're converting another big one is in auto insurance, we're converting a number of big media partnerships to fee based relationships because that better reflects the nature of those relationships some of the bigger scale lower margin opportunities, where we're going to be converting to our platform.
Speaker Change: Fee model some might refer to it as a private exchange model, which one of our competitors of course is much more active in that market. We have a great private exchange product. That's now been adopted by a number of partners and we're looking to convert some of the partnerships that have lower margin into that model because I think it better reflects the.
Speaker Change: The nature of the relationship.
Speaker Change: And it's really a better affection of that of that part of the market, which we're happy to participate in and to be more aggressive in that's going to be a continued good labor force on the margin side, particularly again in auto insurance.
Speaker Change: On top of the media initiatives product initiatives going on we've got a.
Speaker Change: New products.
Speaker Change: That we've been rolling out that have more than doubled this year four to serve.
Speaker Change: Agencies and agency like entities, whereas historically, we've been dominantly, providing our products of course to the direct carriers.
Speaker Change: And those products again are growing very rapidly and are coming in at about twice the margin of our historic direct to carrier click product on top of that we continue to scale and our brand new product areas and they're getting to a decent scale now, including <unk> and our 360 finance product.
Speaker Change: We expect.
Speaker Change: Both to be more than better than breakeven. This year after spending a lot of time and money getting those products to the point, where you can scale them, they're getting to getting to more than breakeven or getting into good scale and getting to the point, we're going to expect them to be inflicting and they've already begun to do so so we're excited about those products and their effect the effect on margins.
Speaker Change: Also on our personal loans area. We are very early and we're very narrow in our footprint there and we now know that of the over 2 million qualified consumers. We see every month in that business, we're only really engaging with about a third of them.
Speaker Change: And less than on a very relatively small portion of them do we master product. We now know the products that they want and we're adding those clients and have added a number of clients to better service that that traffic flow, which will give us a lot more pure margin on the on the inquiries we already see.
Speaker Change: And the ability to go out and source even more so that's an area that we expect pretty dramatic margin expansion in <unk>.
Speaker Change: Over the next couple of years, so that at home services I would just.
Speaker Change: Which is a great business for us already of course.
Speaker Change: We're continuing to scale trades were already in and as we scale those trades, we're doing it in a very smart way by making sure that we're adding clients in Geos, where we don't have full coverage. We don't have adequate coverage and that gives us better yield better margin better media buying power and up goes the web from there so.
Speaker Change: Our focus our growth in home services is really focused on margin expanding growth.
Speaker Change: And buying power growth and that debt.
Speaker Change: Cadence is really working very well for us so across the business a lot of margin expansion opportunities a lot of success already these are not things. We're dreaming about these are the things we're doing.
Speaker Change: A lot more runway on all of them to go.
Speaker Change: Great really appreciate all the color thanks, and congrats on the quarter.
Kevin: Thank you Kevin.
Speaker Change: Your next question comes from the line of Patrick Sholl from Barrington Research. Your line is now open. Please go ahead.
Patrick Sholl: Hi, Thanks for taking the question maybe.
Patrick Sholl: Touching back on home services I was just wondering how you are seeing any of the tariffs impact that that side of the business.
Patrick Sholl: Yes, Patrick we have.
Patrick Sholl: We had not really heard much from our clients about the tariffs until fairly recently and again, we have had no clients reduce spend.
Patrick Sholl: Because of anticipation or anxiety about tariffs, but we have heard from clients that.
Patrick Sholl: They are concerned in certain pockets that the tariffs could meaningfully increase their costs and then they would have to figure out whether or not they would be able to pass those along and if not what that would mean for their economics of what that would mean for their marketing budget. So we have not heard it across the board we've heard it in Parker.
Patrick Sholl: It's obviously, it's a pretty diverse marketplace.
Patrick Sholl: Pretty diverse industry.
Patrick Sholl: So some folks who are more.
Patrick Sholl: Leveraged to.
Patrick Sholl: Say, China for sure.
Patrick Sholl: Would feel a much bigger impact depending on how again the tariffs get implemented would begin in the beginning too.
Patrick Sholl: Let us know that they are doing planning around what happens or what they would do the great news is say very diverse marketplace very very diverse industry.
Patrick Sholl: We're already making plans ourselves to make sure we're leaning into areas that are likely to be less impacted rather than more impacted and we have the ability to make sure that we shift our efforts and our focus to those places.
Patrick Sholl: The other thing to think about.
Patrick Sholl: And this was mentioned by one of our competitors and it's something that folks out and know that if and as the tariffs lead to macroeconomic issues or difficulties one of the things. We also see is that many of these clients buy more inquiries from people like us when the market gets softer because of either pricing due to tariffs.
Patrick Sholl: Or demand reductions due to due to recession. So.
Patrick Sholl: Exactly how to shake out we don't know so one of the reasons. We provided are providing a broader range in the fourth quarter and our fiscal fourth quarter, you're the calendar second quarter.
Patrick Sholl: But right now still.
Patrick Sholl: Strong demand strong performance and and where.
Patrick Sholl: Preparing ourselves to be sure that we're ready in case that changes and hopefully it will not but again I don't think you'd have us know exactly how this is going to play out.
Patrick Sholl: Okay.
Patrick Sholl: Then I realized that with the guidance that you provided there's a wide range of outcomes with the tariffs. So maybe it's a little.
Patrick Sholl: Premature to ask about the next fiscal year, but can you maybe talk about how you're seeing that shape up in terms of like heaters.
Patrick Sholl: A return to the traditional seasonality of revenue trends or do you think that I think you've kind of addressed this with the continued ramp of our active should still be kind of a ramp up of growth to kind of exceed those.
Patrick Sholl: Those trends.
Patrick Sholl: Yes.
Patrick Sholl: Fair question, but we have not completed the planning cycle yet for next fiscal year.
Patrick Sholl: As you can imagine.
Speaker Change: Sans tariffs.
Speaker Change: Would expect pretty strong double digit top and adjusted EBITDA line growth with likely stronger growth on the adjusted EBIT line online.
Speaker Change: And I would ask.
Speaker Change: I would expect generally returned to relatively normal seasonality.
Speaker Change: But for the fact that there has been a little bit of a.
Speaker Change: Modification to buying patterns I think based on waiting to see what's going to happen with the tariffs.
Speaker Change: Rather than there being a downward shift in spending from our clients. What we've more scene is a reluctance to ramp the way they normally would.
Speaker Change: Given the performance that we know they're there they're getting from our from our channel.
Speaker Change: And so I don't know exactly how that would shape out and shape.
Speaker Change: The curve of seasonality curve next year or so.
Speaker Change: Again.
Speaker Change: But without any tariff effects.
Speaker Change: Strong double digit revenue growth and adjusted EBITDA margin growth and probably a return generally speaking to the seasonality patterns, we've seen historically, but for the fact that there's been some.
Speaker Change: Some modification to the curve just based on the anticipation of tariffs.
Speaker Change: But then if you throw tariffs and their implementation and all the permutations of what that might look like into the mix.
Speaker Change: I think we still have good strong revenue and adjusted EBITDA, but in terms of the rates of growth in the shape of the curve is just it's just too complicated to to.
Speaker Change: To sort out.
Speaker Change: Okay. Thank you.
Speaker Change: Thank you Patrick.
Speaker Change: Your next question comes from the line of John Campbell from Stephens, Inc. Your line is now open. Please go ahead.
Speaker Change: Hey, Good afternoon. This is Oscar do you have us on for John Stephens. So my first question I think for Greg you reported that cash exiting the quarter was $80 million.
Speaker Change: So given that cash level on hand, and how the stock has performed over the last few months have you guys considered engaging in any buybacks.
Speaker Change: Yeah.
Speaker Change: Okay.
Speaker Change: Hey, Oscar.
Speaker Change: You know our cash our capital allocation strategy has not changed at all first and foremost we are going to look to grow the business.
Speaker Change: Either through internal investments through M&A or through partnerships.
Speaker Change: We have shown the ability to buy.
Speaker Change: Buy back shares but.
Speaker Change: But I think also in this environment.
Speaker Change: Super prudent to make sure you build up a strong balance sheet and so kind of that's where we're focused right now from a capital allocation standpoint.
Speaker Change: Yeah.
Speaker Change: Okay, Yeah, that's fair.
Speaker Change: Another one for you Greg I think Doug had alluded to this earlier, but we know that this quarter it tends to be seasonally strongest in the last quarter.
Speaker Change: Well as you mentioned was skewed by a big spike in spend by top customers, but looking ahead I am hoping that you can touch on your level of confidence and the ability to grow or near this type of base and that's looking ahead to fiscal year 'twenty six.
Speaker Change: Yeah, I mean, and I can let Doug comment on that as well, but we feel very good about our ability to continue to grow double digits across our business. Both in the short and long term. So our markets are early our positions in our markets early in the overarching trend of the shift from offline marketing do online and with from what.
Speaker Change: And within online.
Speaker Change: From a traditional to performance marketing gives us a lot of runway for a lot of years to grow double digits. So yeah.
Speaker Change: Yeah I have no no.
Speaker Change: Uh huh.
Speaker Change: Lack of confidence in our ability to continue to grow double digits for a long time to come.
Speaker Change: Alright, I'll get back in the queue. Thank you.
Speaker Change: Thank you Oscar.
Speaker Change: Your next question comes from the line of Zach Cummins from B Riley Securities. Your line is now open. Please go ahead.
Zach Cummins: Yes, good afternoon, and thanks for taking my questions I really wanted to ask a little bit more about your auto insurance business. I mean can you give us a sense of how that performed on a sequential basis versus Q2, and it sounds like youre trying to be a little more prudent in terms of just the margin profile of the business that youre doing on that side. So just curious.
Zach Cummins: Maybe your approach has evolved a little bit on the auto insurance side.
Zach Cummins:
Zach Cummins: We were we down yes, we were down sequentially about a little over 10% sequentially, which the whole industry pretty much was because the December quarter was an exceptionally strong quarter for the auto insurers because they had such strong combined ratios going into the end of the calendar year and extraordinary budge.
Zach Cummins: It's available so that was it.
Zach Cummins: I think we talked about this last quarter.
Zach Cummins: So we were which is unusual for Q4 calendar Q4 to be the December quarter will be that strong.
Zach Cummins: It's very unusual for us to be down sequentially.
Zach Cummins: In this quarter, but it was just the nature of the fact that that was such an extraordinarily strong quarter.
Zach Cummins: So this quarter, we've seen a still very strong levels of spend obviously from the numbers.
Zach Cummins: From the auto insurance carriers, but a little bit more of them being prudent about entering a new calendar year, because their loss ratios of their budgets reset and they don't want to get so far over their skis.
Zach Cummins: And and hurt themselves in the back half of the year. So we're seeing good strong spend levels in terms of our approach.
Zach Cummins: We are doing what we've always done which is we want to build a good strong sustainable profitable business in auto insurance, just like we do everywhere else.
Zach Cummins: We are adapting our approach to the fact that the market did come out. So strong there was so much demand relative to media. What we don't want to do is chase all that media down to nothing in terms of margins.
Zach Cummins: Does it make sense to us so we are being a little bit more prudent in terms of how we mix. Our media you heard me talk about that in terms of the growth of proprietary media, where we're not having to compete down to the lowest possible denominator in margin with everybody trying to get it to fill demand.
Zach Cummins: <unk> heard me talk a little bit about private exchange model, which we're happy to lean into they are a great product. There we have some partners on it that are very happy with it we expect to convert some more partners to would we expect to go out in public conquest, some partners from some of our competitors with it.
Zach Cummins: We are happy to lean into that part of the market if margins are going to be relatively low it with some of these.
Zach Cummins: Publisher or media partnerships that we maysville converted to a fee based model, where we don't have the overhead associated.
Zach Cummins: With what we might have in more of a Rev share based model. So we like that and we will mix that in so we are adapting to the market and I think we're in adapting and in a way that I'm very excited about.
Zach Cummins: We're showing real success in that adaptation and I think youre going to continue to see it show up.
Zach Cummins: And in the performance of the business on the margin line.
Zach Cummins: Okay.
Zach Cummins: Understood and just sorry, one follow up question is really can.
Speaker Change: Can you speak to the trends across the different auto insurance carriers that <unk> seen and talk to you here in kind of recent months I know throughout the last couple of quarters. Its really been outsized contribution from a couple of the top carriers I'm. Just wondering if that dynamic has shifted a little bit here in recent months.
Zach Cummins:
Zach Cummins: Ill talk generically of course, because it's not my role to talk specifically about what my clients are doing or not doing but he had quint street, we have the broadest footprint of engagement.
Zach Cummins: With the most clients spending over $1 million a month with us that we've ever had.
Zach Cummins: So and that's super exciting for us because the market historically has been.
Zach Cummins: <unk> for sure but.
Zach Cummins: But generally speaking over the past couple of quarters.
Zach Cummins: That market has broadened quite a bit I would say, while the spend patterns haven't necessarily stayed exactly the same the general trends going forward.
Zach Cummins: We would expect to continue to be that there are a lot more carriers spending a lot more of their budgets online and a lot more of that online budget being spent in performance and in particular with us.
Zach Cummins: Because we're seeing those carriers.
Zach Cummins: Commit to the channel and we're seeing them commit to building the capabilities that make you successful in this channel.
Zach Cummins: Which tend to be much more data and analytics based than they have been in other channels historically and so it takes time it takes work.
Zach Cummins: But because of the leadership with some of the carriers that have been so successful in this channel.
Zach Cummins: I think others have.
Speaker Change: I have a real felt need to follow and to figure out how to get it right.
Speaker Change: So I think the general the general trends are broader more clients spending more.
Speaker Change: Better deeper engagement with us on performance and on the things that make performance work in terms of short term patterns there as theyre shifting all over the place because of the new calendar year and tariff concerns.
Speaker Change: All the other things that are going on but I kind of read through that and assume that the broader pattern is as Laura what I just talked about.
Laura: Yeah, and Jack just to give you just some numbers related to that we said our auto insurance grew 165%. If you exclude our largest client the rest of the uninsured business grew over 150% so very broad based.
Speaker Change: Ramp from a lot of carriers as Douglas said.
Speaker Change: Understood well, thanks for taking my questions and best of luck with the rest of the quarter.
Patrick Sholl: Thank you Zack.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: As a reminder, if you wish to ask a question. Please press star one the next question.
Speaker Change: Comes from the line of Chris Sakai from singular Research. Your line is now open. Please go ahead.
Chris Sakai: Yes, hi.
Speaker Change: Just kind of I just want to ask you about auto insurance.
Speaker Change: And I mean are we seeing is this your opinion or are we seeing.
Speaker Change: That the tariff anything with tariffs on cars.
Speaker Change: Could you maybe with with a lower.
Speaker Change: Lower demand for auto insurance.
Speaker Change: Advertising is that what we're seeing.
Speaker Change: With this sort of hiccup in our decline sequentially in auto insurance and how should we see this going.
Speaker Change: For the year.
Speaker Change: We are not seeing that yet Chris.
Speaker Change: <unk>.
Speaker Change: <unk>.
Speaker Change: Sequential decline from the December quarter is really just due to the fact that December quarter was an extraordinarily big quarter for auto insurance clients spending online.
Speaker Change: The strength of their financial results last calendar year. So it's what we're seeing this quarter is really more normalized for continued very strong growth year over year of course.
Speaker Change: The March quarter.
Speaker Change: But not at the extraordinary levels that we saw due to the factors I just talked about in the December quarter.
Speaker Change: We're seeing good stable spend this quarter and extending into the current quarter.
Speaker Change: Say.
Speaker Change: March quarter extending into the current quarter I.
Speaker Change: I do think that we are not seeing quite as aggressive aggressive of a ramp yet as we expect to see given how strong the financial results are for the carriers Theyre reporting publicly very very strong.
Speaker Change: Combined ratio results in the eighties.
Speaker Change: Which is really really good and they are willing to spend up well into the nineties.
Speaker Change:
Speaker Change: And they don't have to because the results are good so.
Speaker Change: I think the effect of tariffs right now is that we're they're probably holding back on ramping their spend as much as they will even beyond where we are right now until they know what the tariff impact is.
Speaker Change: On their business on their claims costs.
Speaker Change: But we have not seen any carriers yet.
Speaker Change: <unk> their spend.
Speaker Change: And tell us that theyre doing that reduce our spend based on.
Speaker Change: Tariffs and tariff results because the tariffs aren't actually enacted yet.
Speaker Change: And be their results were actually really strong so.
Speaker Change: That is not what we're saying.
Speaker Change: Okay sounds good and thanks.
Speaker Change: Have you seen any.
Speaker Change: Early signs of success and any other new verticals or client segments.
Speaker Change: We are.
Speaker Change: Across the board really we have a we have seen extraordinary growth in our new products aimed at the agency side of the insurance market, which is a place we really not participated historically.
Speaker Change: Big strong triple digit growth in now running at well over 10.
Speaker Change: Let's see.
Speaker Change: Whatever 10 figures a year in terms of the run rate at this point ramp too.
Speaker Change: We have ramped to that very quickly and we're going to see we had a lot more to do there lot more opportunity that's half of the online market and we're a very small share of that and we expect to be a very good share of that in coming quarters and years. So that's one area that is a real standout.
The opportunity. We are also seeing good success to success in some other segments of insurance.
Speaker Change: I won't talk about them, but they are big areas as well I won't talk about just because of competitive sensitivities.
Speaker Change: On a road map for people, we continue to see great success in our home services business, adding new trades.
Speaker Change: We've added several new trades this year.
Speaker Change: A number which are getting into good scale, while we continue to ramp the trades, we were already in to.
Greater scale and we expect to add you know good numbers of new trades each year over the next.
Speaker Change: 10 years. So that has continued to be a good success as always is creating new footprint for strong growth going forward and home services.
Speaker Change: And our credit cards business, we are adding new media and new products and in our banking business. The same thing we are seeing good success, there and then in our personal loans business, but we have a roadmap now to show pretty dramatically broadened our offerings.
Speaker Change: That customer base, because we have more demand from consumers and we have clients and products to fill that demand, which is exciting for us because it's easier to get the clients and products and is to get the consumers. So we are adding at a pretty rapid clip.
Speaker Change: More products in clients that can better serve and serve segments of their consumers that today, we don't have anything to match them to.
Speaker Change: So I would say, yes across the board a lot of good strong momentum and growth initiatives.
Speaker Change: And and new verticals, if you will a.
Speaker Change: Whether you define that as another more trades in home services.
Speaker Change: Our more areas and segments of insurance.
Speaker Change: Or more products to serve consumers that we're already seeing in the credit businesses.
Speaker Change: Okay, great. Thanks for the answers.
Chris Sakai: Thank you Chris.
Chris Sakai: Again, reminding you for questions. Please press star one.
Chris Sakai: Yeah.
Speaker Change: Thank you there are no further questions at this time. Thank you everyone for taking the time to join Quinn Streets earnings call replay information is available on the earnings press release issued this afternoon and this concludes today's call. Thank you.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: Okay.