IAC Inc. reported fourth‑quarter 2025 results with total revenue of $646 million, a 10.5% decline year‑over‑year but a $5.3 million beat over the consensus estimate of $640.7 million. The company posted an earnings‑per‑share loss of $0.99, falling short of the $0.67‑$0.71 range expected by analysts, a miss of $1.66 or 248% relative to consensus.
Revenue mix shifted as People Inc. drove a 14% year‑over‑year increase in digital revenue to $355 million, while Care.com’s revenue fell 9% to $58 million. The search business also contracted, largely due to Google algorithm changes and reduced affiliate marketing spend, contributing to the overall revenue decline. The digital segment’s growth helped offset headwinds in legacy businesses.
Operating margin contracted to –17.5% from 6.7% a year earlier, reflecting higher operating costs and a weaker search business. Digital adjusted EBITDA margin remained flat at 28% YoY, indicating that People Inc.’s profitability is holding steady even as overall margins compress. The mix shift toward higher‑margin digital revenue is a key factor in the margin profile.
Management guided 2026 adjusted EBITDA to $310 million–$340 million, with digital adjusted EBITDA projected at $325 million–$355 million, below the $319 million consensus estimate. The guidance signals caution amid search‑business headwinds but confidence in People Inc.’s growth trajectory. IAC also reiterated its strategy to simplify the company, strengthen cash, and deploy capital through share repurchases and increased ownership in MGM Resorts.
Neil Vogel, People Inc. CEO, emphasized a focus on “audience engagement and off‑platform growth,” while Chairman Barry Diller highlighted confidence in People Inc.’s performance and reiterated the company’s commitment to capital allocation, noting a $337 million deployment back into the business and a continued stake in MGM. The comments underscore a strategic pivot toward digital content and AI partnerships with Meta, OpenAI, and Microsoft.
Investors reacted positively to the earnings, citing the revenue beat, People Inc.’s robust digital growth, and the company’s AI‑driven content strategy as key factors that outweigh the EPS miss. The market’s response reflects confidence in IAC’s long‑term digital trajectory despite short‑term profitability challenges.
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