IAC at TD Cowen Conference: Unlocking Shareholder Value

On Thursday, 29 May 2025, IAC/InterActiveCorp (NASDAQ:IAC) presented at TD Cowen’s 53rd Annual Technology, Media & Telecom Conference 2025. The company outlined its strategic focus on unlocking shareholder value by addressing the undervaluation of its private assets. The discussion highlighted both promising growth opportunities and challenges, with an optimistic tone on future execution.

Key Takeaways

• IAC is focused on unlocking shareholder value through strategic maneuvers like M&A, buybacks, and divestitures.
• Dotdash Meredith achieved over $300 million in EBITDA, with digital revenue growth continuing.
• IAC views MGM Resorts as undervalued, holding a 23% stake with significant upside potential.
• Care.com is undergoing a turnaround with a new management team, targeting improved margins.
• IAC repurchased $200 million of its stock in the first half of the year, seeing it as underpriced.

Financial Results

• Overall Financial Position:

- IAC's equity is perceived to be trading at zero value when offset by MGM stake and $800 million of NOLs.

• Dotdash Meredith (DDM):

- Achieved over $300 million in EBITDA.

- Targeting $330 million to $350 million in adjusted EBITDA for the full year.

- Digital growth projected at 7% to 10% annually.

• Care.com:

- Aiming for $45 million to $55 million EBITDA for the year.

- Targeting 20% margins with revenue growth.

• Corporate Expenses:

- $43 million in Q1 expenses, expecting $80 million to $90 million by year-end.

• Share Buybacks:

- $200 million of stock repurchased, representing 5% of the company.

Operational Updates

• Dotdash Meredith (DDM):

- Leading digital and print publisher in the U.S. with over $1.8 billion in digital revenue.

- Launched new apps to increase engagement.

• MGM Resorts:

- IAC holds a 23-24% stake, actively involved in strategy.

• Care.com:

- New management team focusing on product and marketing improvements.

• Turo:

- Leading car-sharing platform with significant revenue and slightly positive EBITDA.

• Daily Beast:

- Achieved EBITDA positive results for the first time in over a decade.

Future Outlook

• Capital Allocation:

- Continued focus on share buybacks and strategic M&A.

• Strategic Focus:

- Targeting sectors like leisure, media, and travel for M&A opportunities.

• Dotdash Meredith (DDM):

- Anticipating macroeconomic softness in Q2 and Q3, with strength in Q4.

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• MGM Resorts:

- Belief in significant upside potential due to undervaluation.

Q&A Highlights

• Advertising:

- Strong premium direct advertising, though programmatic prices are compressed.

• Turo:

- IAC not prioritizing a controlling stake, focusing on driving value.

• Large Language Models (LLMs):

- Ongoing discussions with developers like OpenAI, with licensing on hold.

For more detailed insights, readers are encouraged to refer to the full transcript below.

Full transcript - TD Cowen’s 53rd Annual Technology, Media & Telecom Conference 2025:

John Blackledge, Internet Analyst, TD Cowen: Good morning, everyone. I'm John Blackledge, Internet analyst here at TD Cowen. We're happy to have Chris Halpin, Executive Vice President, Chief Operating Officer and Chief Financial Officer at IAC. Chris is going to walk through an investor presentation, which is available on IAC's Investor Relations website. And then, time permitting, there'll be questions for the audience.

Chris, thanks. Thanks for doing this.

Chris Halpin, Executive Vice President, Chief Operating Officer and Chief Financial Officer, IAC: Absolutely. Thanks, John. Yes, so we're trying something different today. We put the new investor presentation on the website as of earnings. We had a short few slides from it that we went through on the earnings call.

But this is the more in-depth. And we really want to give investors, especially those who are newer to IAC, a foundation in the story, our assets, where we are, and where we're headed. So I'll refer to page numbers for those on the phone or listening through streaming. Page three, this is just the core mission of IAC. And there are a few terms that we really focus on.

One is financially disciplined opportunism. That's been throughout our history. We are at our core cash flow owners, investors. We look for value creation. But we are also opportunistic.

The second is rational patience of permanent capital. We are generally closed system and have recycled money over the years and put it to work in a variety of different environments. And then the third is exceptional shareholder returns and spins. And we've done that throughout our history. Page four is just you guys have seen it.

It evidences throughout IAC the different forms we've taken and also the proactive approaches we take to generate shareholder returns buys, spins, startups, consolidations, mergers, etcetera. And as we look at our current portfolio we'll talk about it today we are going to continue to do that. And then the last slide on page five is just we've reinvented ourselves multiple times. So where are we going next? And that's the topic today.

Barry about this. Barry Dillard, our chairman, talked about this two earnings calls ago, where we really had a rough spot coming out of 2021. In many ways, the pandemic froth led us to be in a position where we had a couple assets that were in challenging spots. One was Angie, The flawed strategy of the heavy investment in services as well as the rebranding really destroyed a lot of value. We focused on that and pivoting it.

And then the second was our business Dotdash acquired Meredith in late 'twenty one off extremely high pandemic consumption engagement numbers, put out very aggressive targets. The integration there was harder than thought. And we also had the unhelpful ad recession start in about Q2 of 'twenty two. So I joined in 'twenty two, and we really went in a laser focused way on execution. Angie, which we spun on March 31, we got into a far better spot.

Joey Levin, our then CEO, went in as CEO of Angie. We cut out a lot of wasted spend and, as we called them, low calorie revenue dollars. Got them to a much better spot, free cash flow positive. Jeff Kipp moved from running Europe to running of Angie as CEO. And we spun them and think they're off to a great start as a standalone public company.

Dotdash, in many ways, the industrial logic of combining the two businesses we'll talk a lot about Dotdash today rang true. It was more getting through the challenges of the integration, the step down in pandemic traffic, and the ad recession. But where we are now, we feel great about over $300,000,000 of EBITDA, continued digital revenue growth, continued total top line growth, and a lot of opportunity. So because of that, as Barry said, we are in a much different mindset today when it comes to capital allocation, when it comes back to buying our own stock. We bought back $200,000,000 in the first half of the year.

And we are glad to be through that era. Page seven are the core assets that define IAC today. Dotdash will talk a lot about that, the number one digital and print publisher in America. MGM Resorts our 23% plus stake there, and active involvement in that company. Care.com, where we own 100%, the leading home care marketplace in the world.

Turo, the leading car sharing marketplace where we have 32% ownership Ask, our longtime search business that continues to survive and chug along our smaller businesses, Vivi and Daily Beast and then our headquarters that we own unencumbered in Chelsea, and then $900,000,000 of cash at the holdco on hand. But when you look at those assets and also the progress we made, we realize the reality is if you net out our MGM stake at its public value, and we have $800,000,000 of NOLs to offset the gain there, and our cash, which is free and clear apparent, our equity, the rest of our company, which comprises the assets on the right, is trading at zero value. And so we recognize that discount, and we are actively focused on shrinking it. How are we going to do that? We've done it before.

John Blackledge, Internet Analyst, TD Cowen: Throughout its history, IAC has traded at a discount of various levels. This is one of

Chris Halpin, Executive Vice President, Chief Operating Officer and Chief Financial Officer, IAC: the biggest to the perceived value of our private assets, times at a premium, but predominantly at a discount. But we are at a high level right now, and we have a game plan that we've done in the past and that we plan to do on a forward basis to realize and unlock that discount. First is simple execution. It seems like a platitude, but that's the reality. We've been doing it the last few years.

Dotdash, MGM Care, our other businesses. We've made management changes at IAC, with Barry coming much more actively involved as CEO. I, as COO and CFO, report to Barry, as does our general counsel, and then Neil Vogel, who's CEO of Dotdash Meredith. All the other company CEOs report to me. We've also brought in a new management team at Care we'll talk about.

And then the Daily Beast, brought in a new team, who's really reinvigorated. We've been focused on corporate cost rationalization, particularly with the Angie spin and smaller footprint. And we'll continue to narrow that down. This year's numbers are skewed by some large one time events. And then we're focused on free cash flow and continuing to delever Dot Dash Meredith.

Capital allocation is key. We talked about 5% of the company we bought back in the first half of the year. We will continue to look at buybacks. We still view our stock as underpriced. We increased our share authorization to another 10,000,000 shares in the first quarter.

We are looking at M and A, both strategic add ons for our existing holdings, DDM, others, as well as new platforms. And we'll talk about that in a second. And then opportunistic divestitures. We've sold two businesses where we thought the cash would be better served within IAC and whether it's buying our own stock or other purposes. We said a couple quarters ago, MGM and DDM are core.

And then really everything else for the right strategic acquirer, we would contemplate a transaction. And we think those businesses have strong strategic fits. We're not going to necessarily run out and sell them tomorrow. But freeing up that cash to do other things with continues to be a key priority. And then the last step is catalysts.

We view those as spins. We spun Angie when we felt they could be standalone. And we're not going to sit passively by relative to large catalysts given the size of our discount and how undervalued we think we are. So that's the playbook, and one that's worked in the past, and one we are heads down executing. On M and A, we included this slide just to give you a sense of where we're looking.

It really is across all stages of companies. We're looking at some early stage things, some mid and later stage. We are interested in companies that are around the leisure space, entertainment, media, travel, hospitality, engagement, things that not disintermediable, especially with less large tech platform dependence, or as Barry Diller calls them, the tech overlords that are out there. So more one to one relationships. We've seen great things from MGM, from digital gaming in MGM, and live experiences.

And we are actively looking, led by Rust Farsht, our head of strategy and

John Blackledge, Internet Analyst, TD Cowen: M

Chris Halpin, Executive Vice President, Chief Operating Officer and Chief Financial Officer, IAC: and A. And we are, while also contemplating buybacks, seeing if there are interesting investment opportunities. Moving to the companies, Dotdash Meredith, we formed this in late 'twenty one through the combination of our business Dotdash and the much larger Meredith. Where we are today, number one digital and print publisher, over $1.8 in majority digital revenue. And we really benefit from three key assets, are three key strategic elements, are at the bottom.

One are our brands. And the learning of the last few years is, even with the platforms, with AI, everything, having top brands that consumers trust that you can drive repeat traffic to, combined with best in class technology, which is what Dotdash brought to Meredith, you will win. And we've seen that in our core traffic increasing and also in how strong we are at direct sales to advertisers and brands. The second, which we'll talk about more, is Decipher. That is the predictive analytics, AI driven ad targeting solution that we have developed.

And we really think we're the only ones who can develop using intent rather than cookies. We've had great success rolling that out direct to advertisers on our inventory, and we'll talk about expanding that to the broader open web. And then the last is the diversity of our revenue. We'll talk about that in a bit. But we are diversified across industries health, home, CPG, travel, food, beauty, on down the list.

And we are also diversified. We've got advertising. We've also got an incredibly strong performance marketing business, where we are a top partner for Amazon, Walmart, Target, others. And then we've got our licensing business and our events business. And we'll talk more about those revenue streams.

This is page 14 are our properties. You can see that all of these are really intent driven special interest categories. We are the number one player in food, entertainment, and home. We also can segment and Neil Vogel, our CEO, has talked about this. We can really segment users across so many of these where we have young, old, urban, rural, rich, middle, lower income, etcetera.

That scale is differentiated for advertisers as they're seeking different groups or trying to get the whole market. Real strength in beauty and style, and we've adapted that business as we've gone to the changing nature and where consumers are going. Health, excellent property and doing very well for us. And then finance and travel. This next page is just a sense of scale versus other publishers.

And in some ways, think we're getting or we know we're starting to encroach on the platforms in our scale and in our reach. Page 16 is an important strategic element. So we have really two main ways to engage with consumers, forgive me. One is on our owned and operated sites, which are the consumption data you just saw. The other is off platform, which we've gotten better and better at and we think is a real strength.

On our own properties, we've obviously got our sites. The key element here was taking the Meredith sites and moving them to the best in class Dotdash platform, building a whole new ad performance stack. And we have had a great experience of driving repeat traffic, market share, etcetera, through top brands, better and continued refresh content, and best platforms. We've got our People app that we launched, as well as our My Recipes locker. These are two new digital products launched this year, which now that we've got the company in the right spot technically, we can launch these product extensions, drive greater repeat traffic, drive greater engagement, and have differentiated content.

And you'll see more of these types of products. You can see ratings and reviews. This is a real strength. Because of the infrastructure we have, we actually test products. We test experiences.

We can then market them, and that heavily helps drive our e commerce platform. Email sounds old. This is a tremendous channel. I get it from certain things like New York Times, others. It is a very good re engagement platform or channel, I should say to bring people back to your site.

And we've gotten better. It also helps us in building our database and has been a nice source of direct traffic. Events, these are premium experiences, also very helpful with advertisers. Food and wine is a great platform for this. We have others.

Brand licensing, about $100,000,000 of revenue, different channels there. And then print, which has really outperformed expectations since we bought. We very much slimmed it down when we bought it to what we call the magnificent seven titles. They all exist on their own two legs. And we will continue to manage that business to offset corporate.

10,000,000,000 sessions annually on O and O digitally. And then we have these off platform audiences. Apple News is a tremendous partner, continuing to drive traffic. None of that shows up in our sessions. You can see social media.

We've really grown our video on YouTube over the last couple of years, and 50,000,000,000 plus views annually off platform. Diversified monetization, digital advertising is 63% of our digital revenue. That's roughly twothree direct premium sold, onethree programmatic. Performance marketing, 24. We think we're best in class at this, both because we test the products, can recommend them, and also our integrations and tactics there.

Licensing, that includes Apple News and our OpenAI partnership, as well as some product licenses we have with Walmart and others. And then print revenue, And you can see the makeup there. And we're over half digital revenue, and that'll keep growing. Decipher is an important one. So this was developed because of the intent driven nature of our sites.

We got so much signal that you'll never get from cookies. And then running that through AI, machine learning, and performance, all of our performance testing online, we can pick the best ad to serve relative to a consumer. If they're looking at painting a nursery, it means they recently had a child. You can obviously recommend paint, but you can also represent a host of others. We have scored all those elements on our sites.

And that drives Decipher, which is we guarantee performance. We beat cookies in all of our tests for the metric that our advertisers are looking at. And we can now also roll this out. And OpenAI has been a key partner for us in this across the open web. So we can then guarantee performance by programmatically on third party sites that have the same signal as ours, same categories, etcetera, and monetize and generate an attractive margin.

We rolled this out in Q1. We think this can be a really meaningful part of our business. And we are actively scaling that up this year. Quarterly digital growth, you can see up top, we consistently grew across last year, grew 7% in the first quarter. We knew it was going to be a tough comp for a few factors.

Some spikes at people the year before the leap year and also Easter, which matters to us, shifting into Q2. A little bit of headwinds with the fires and entertainment, but 7% digital growth there. We've guided 7% to 9% for Q2 and 7% to 10% for the year. And then financially, top line overall growing led by digital. And we scaled up adjusted EBITDA.

We were doing $3.00 $9,000,000 on a trailing basis, guided $330,000,000 to $350,000,000 for the full year. There is strong free cash flow conversion off this. We have a minor amount of CapEx, working capital. And then we have 1.2 net, dollars 1.4 credit facility that we were very happy to delever, which was our stated goal, below four times leverage as of twelvethirty one. And with that being below twelvethirty one sorry, being below four times leverage, we can then dividend cash up to IAC parents so we have further flexibility in what is our cash flow machine.

MGM Resorts, we originally invested in 2020 through a little bit of incremental purchasing, originally about 12, but also the amount of buybacks they've done. We've accreted up to 23%, twenty four % ownership. Skipping to page 23, people ask us, what do we see in MGM? This is really the slide. You've got the digital properties, both BetMGM, which has really turned it around, put up a nice first quarter.

And we and Ntain and MGM have all actively worked with them to get their strategy and marketing where they want it. We also have the owned and operated digital properties in MGM, LEO, Vegas, Push, and then our Globo joint venture in Brazil. Market share in Las Vegas. Premier properties, premier positioning in what is increasingly the digital entertainment core of the world. Combined, there's over 50,000,000 MGM Rewards members.

And then you've got the international opportunities, Macau, and in the future, Japan and Dubai. We view it as grossly undervalued, trading at about 3.3 times current value for properties. And they've been active re buyers of their capital. So to us, the property should be rated, the digital will continually be recognized, and we think there's a lot of upside. Barry and our advisor, Joey Levin, are both on the board.

We're active supporters of the company and believe MGM has real upside. Care, we bought this business in 2020. The key message here is it is the number one site for acquiring home services care for your child, for your senior, and increasingly for your pet. The macro dynamic there is only strengthening and will only strengthen with federal spending cutbacks. And we have the premier infrastructure, the largest infrastructure of background check caregivers.

We've got liquidity on both sides of the market. The story in care and then there's two parts to the market going to pay the business, 27. Direct to consumer, where consumers come on and subscribe and get access to our platform and match with caregivers. And then care for business, where companies, everything from Fortune 500 to small and medium businesses, buy backup days through care and access to our platform for their consumers should their caregiver get sick so they can come to work and have a backup caregiver or at a facility. We bought it in 2020, made significant investments in the platform, improved that, got a huge bump from COVID.

And for the enterprise business, it really jump started it to a different level and made it a base benefit in most companies. Consumer had masked some of the product challenges. We brought in a new CEO in 2023, Brad Wilson, who's appointed a new management team. And they're really taking care, now that they've made the investments in the product and in the platform, back to market this year. Business has slowed down growth.

Consumer's been turning around, but was declining, And really positioned to grow better platform, better matching, improved pricing and packaging and marketing. And we expect to see that. You can see the flat revenue over the last few years on '29. Good business, good margins. We think over time they can be even better, get to 20% with some revenue growth.

At the bottom of '29, you can see the core economics are solid on payback and retention. The key is improve the product, improve the marketing, and take advantage of the significant opportunity in front of care. So that's been a real point of focus. Turo, just going to page 33, we invested in this company in 2019, bought some more over time, and then exercised a warrant. It is the leading car sharing market.

Think of it as the Airbnb for cars, competing with rental cars and also additional use cases like long term rentals and test driving cars or special experiences. They had a S1 on file, which they've pulled. We were fine with that. We've always said we were indifferent to them going public. What we want them doing is executing on the opportunity, competing with the rental car companies, growing the market.

Big opportunity there is marketing. The NPS repeat experience, all that of people who get into Turo and use it, is excellent. Unaided awareness is about 16% to 18%. So based on the last S1, we can't disclose information on an ongoing basis. But they had $900,000,000 plus of revenue, slightly EBITDA positive.

They've got plenty of cash. It really is heads down, execute, grow the business, and build a new top marketplace, and then pursue liquidity options over time. Other assets, Vivien, really one of the top health care staffing platforms. They are doing really interesting things with AI a thought leader in our portfolio and also being a resource on product development, customer service, other areas. It's impressive to see.

Daily Beast, our new leadership there, have done a great job of revitalizing the platform, Joanna, Ben, and Keith. And we had EBITDA positive, which is a first in our ownership of the beast over a decade plus. Ask, our search business, we just renewed the contract there, guiding about 10,000,000 to $15,000,000 of EBITDA. And then our headquarters building, which we bought the land on and own free and clear of any mortgage. So we talked about it, but that's our portfolio.

And our plan, again, page 35, those other businesses, as we build them up, we believe they're strategic partners. There's opportunities to realize value there. We will pursue opportunistic divestitures. We are looking at M and A. We also believe there's a big value in our own stock.

And we will pursue catalysts. Just finally on guidance, we reaffirm guidance at DDM. Our overall approach to guidance given tariffs and today is a new day or a further development in tariff cycle. We were looking at our existing businesses. DDM, premium advertising was solid hanging in there.

Programmatic was softer, which you'd attribute to some concern by advertisers. Consumers were still spending strongly on performance marketing. Maybe tariff pull forward may be real strength. So the overall approach we took was to expect some softness macro Q2 and Q3, relative strength in Q4, and no big recession. And based on that, you can see our guidance.

We reaffirmed $330 to $350 for DDM, dollars 45 to $55 for care, 10 to $15 You can see all those numbers. In the corporate, we would highlight we had about $43,000,000 of corporate expense in Q1. We had CEO separation costs, spin costs, as well as severance at IAC corporate and some other things. The run rate, we expect to leave the year at about 80 to 90. But it is inflated.

And we'll continue to look how to rationalize that and chip away. But it is inflated by the Q1 spending. And then you can see the rest of the guidance. So with that, I will stop there and welcome any questions.

John Blackledge, Internet Analyst, TD Cowen: John? Yeah, maybe two questions. First on the macro, broadly with tariffs. Just can you walk through was there a pause early in 2Q? And then as the tariff narrative is cooling down, are you seeing what are you seeing in terms of spending?

Or is it maybe still a wait and see

Chris Halpin, Executive Vice President, Chief Operating Officer and Chief Financial Officer, IAC: Yeah. What we saw was if you go to April 2, there was real strength March 31. That now seems a long time ago given the volatility since then. What we saw afterwards, we were expecting a shoe to drop just given how negative the news flow was. Premium Direct, which we said is just over twothree of our advertising revenue, has stayed strong, solid.

And that strength in areas like health and beauty and even tech, which is coming off really low numbers, being offset by some definite weakness or pause in food and bev, CPG, parts of retail. But overall, direct premium has been fine. Programmatic, that's the more spot immediate. That reset, we were up 15%, twenty % on programmatic prices year over year. That quickly compressed to flat to up a few percent.

So that's where you see it. Question is which way we're going. And then as I said, on our performance marketing, consumers spending strongly March, April, and continue to. We don't have enough insight to say what will be the long term winner between or which will be right between what the direct market's doing and what the programmatic market's doing. But it's hanging in there.

And where you see concern is retailers and CPG companies not knowing what their inventory will be June, July, August, September based on ships not coming in. But if you can have resolution of some of these tariff issues, I think you can set up for a solid position going into September thereafter.

John Blackledge, Internet Analyst, TD Cowen: Maybe one or two more. On Turo, is there a path for IAC to take a controlling stake in the company at some point?

Chris Halpin, Executive Vice President, Chief Operating Officer and Chief Financial Officer, IAC: I don't think that would be a priority. We've got 32%, three eighty million invested. We really want to work with them to execute on the opportunities that they have in front of them and get the marketing going and drive value there.

John Blackledge, Internet Analyst, TD Cowen: Maybe another one on so you have the OpenAI relationship. But then there's Google out there, Anthropic, a number of other hires. Just curious, are you having discussions with them?

Chris Halpin, Executive Vice President, Chief Operating Officer and Chief Financial Officer, IAC: Yeah. We've had a number of discussions with large language model developers, builders, that were in various stages. I think OpenAI was the farthest along, some might say, in the five stages of grief, that they need a license to train an LLM on copyrighted content. And OpeningEye has been a great partner, including on Decipher. The others have progressed at different rates.

A lot of that kind of froze with deep seek. And then right now, all these guys are looking at the administration hoping they come out with something that would enable LLM training. We think even if they do, the Copyright Act and fair use is actual legislation and protects our IP. But I think those licenses are on hold while people figure out what the administration's position is going to be. Yeah.

I mean, it's clearly been a negative in certain settings lately. And we're cognizant of that when we look at some other peers. I think right now, the performance, given where MGM's trading, there's enough upside in just performance bucking the negativity around the outlook in Las Vegas and then proving out the digital strategy that we can drive value there. Relative to discount longer term, it's something we're going have to think about. We do highlight some people tax affected our gain.

And we do highlight, given our NOLs, we can use that to offset our gain there. That's it. Thank you all.

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