Online insurance comparison site EverQuote (NASDAQ: EVER) reported revenue ahead of Wall Street’s expectations in Q1 CY2025, with sales up 83% year on year to $166.6 million. The company expects next quarter’s revenue to be around $157.5 million, close to analysts’ estimates. Its non-GAAP profit of $0.34 per share was 31.5% below analysts’ consensus estimates.
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EverQuote (EVER) Q1 CY2025 Highlights:
- Revenue: $166.6 million vs analyst estimates of $158.3 million (83% year-on-year growth, 5.2% beat)
- Adjusted EPS: $0.34 vs analyst expectations of $0.50 (31.5% miss)
- Adjusted EBITDA: $22.51 million vs analyst estimates of $19.97 million (13.5% margin, 12.7% beat)
- Revenue Guidance for Q2 CY2025 is $157.5 million at the midpoint, roughly in line with what analysts were expecting
- EBITDA guidance for Q2 CY2025 is $21 million at the midpoint, above analyst estimates of $18.59 million
- Operating Margin: 4.8%, up from 1.9% in the same quarter last year
- Free Cash Flow Margin: 13.3%, similar to the previous quarter
- Market Capitalization: $877.5 million
StockStory’s Take
EverQuote’s first quarter performance was shaped by continued strength in its core auto insurance vertical and expanding adoption of its technology-driven products. CEO Jayme Mendal attributed the company’s revenue momentum to increased carrier spending and advancements in EverQuote’s machine learning-powered bidding platform, which enabled more precise traffic acquisition and improved referral quality. Management also highlighted operational efficiency gains from automation and disciplined expense management as contributors to margin expansion, although certain one-time expenses impacted reported profitability.
Looking ahead, management signaled that growth will likely moderate as carrier spending normalizes after a period of recovery in the auto insurance sector. CFO Joseph Sanborn stated that upcoming investments in technology and artificial intelligence will be a strategic focus in the second half of the year, aimed at maintaining EverQuote’s competitive edge. While the company expects its adjusted EBITDA margins to remain near current levels, management acknowledged that external factors such as tariffs and macroeconomic changes could influence claims costs and future spending patterns.
Key Insights from Management’s Remarks
EverQuote’s leadership identified several factors driving first quarter results, particularly around technology adoption, customer relationships, and operational efficiency. The company’s emphasis on data-driven products and its differentiated marketplace position were recurring themes.
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Expanded carrier budgets: EverQuote saw increased spending from enterprise insurance carriers, which led to record P&C insurance quote requests and revenue. Management cited the flywheel effect of improved referral performance attracting more carrier budget and higher bids.
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AI and machine learning adoption: The company’s proprietary machine learning traffic bidding platform and Smart Campaigns product have driven both operational efficiencies and improved customer outcomes. For example, management noted that Smart Campaigns adoption led to over 40% improvement in campaign performance for a customer.
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Agent channel growth: EverQuote deepened relationships with local insurance agents, expanding its one-stop “growth shop” approach. Paid products per agency grew 25% year-over-year in March, reflecting broader adoption of value-add features beyond core leads.
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Operational efficiency initiatives: Investments in automation and streamlined technology platforms allowed the company to deliver new features more quickly and reduce workforce requirements for certain processes, contributing to margin improvement.
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Industry backdrop and competitive landscape: Management noted that healthy carrier underwriting profitability enabled more aggressive growth spending, while EverQuote’s focus on P&C insurance and differentiated data strategy positioned it to capture market share as the industry landscape evolved.
Drivers of Future Performance
Management’s outlook for the coming quarters centers on sustaining scale advantages, ongoing technology investments, and monitoring industry headwinds such as tariffs and insurance carrier spending normalization.
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Technology and AI investments: EverQuote plans incremental investment in technology, data assets, and AI during the second half of the year to support operational efficiency and competitive differentiation. Management expects these investments to yield long-term returns rather than immediate results.
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Carrier spending patterns: The company anticipates growth to moderate as auto insurance carrier budgets move toward more normalized levels after the recent recovery, impacting revenue trajectory in the second half of the year.
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External uncertainties: Management highlighted potential risks from macroeconomic shifts and tariffs, which could increase claims costs and influence carrier advertising budgets. The company believes it is well-positioned due to healthy carrier profitability but will closely monitor these developments.
Top Analyst Questions
- Maria Ripps (Canaccord Genuity): Asked about the impact of tariffs and the structural health of carrier profitability. Management indicated carriers currently have healthy margins, providing a cushion against potential cost inflation from tariffs.
- Jason Kreyer (Craig Hallum): Inquired about variable marketing margin (VMM) trends and the impact of AI and machine learning. Management explained that their bidding platform has already reduced costs and improved efficiency, with further AI-driven improvements expected over time.
- Zach Cummins (B. Riley): Probed for details on agent channel growth following recent product rollouts. CEO Jayme Mendal highlighted a 20–30% growth in the agent business, driven by deeper relationships and expanded product offerings.
- Ralph Schackart (William Blair): Sought updates on the adoption of the Smart Campaigns product and its effect on overall performance. Management reported critical mass adoption and significant improvements in customer campaign outcomes.
- Mayank Tandon (Needham): Asked about the growth opportunity within existing top customers versus new carriers. Management responded that growth is primarily constrained by operational execution, not budget caps, emphasizing product performance as the key unlock.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will focus on (1) execution of EverQuote’s planned technology and AI investments and the speed at which these enhancements drive operational efficiency, (2) trends in carrier advertising budgets and whether current growth in digital channel spending persists, and (3) adoption and monetization of value-added agent products. Developments in tariffs or macroeconomic factors could also impact industry profitability and EverQuote’s growth trajectory.
EverQuote currently trades at a forward EV/EBITDA ratio of 11.5×. At this valuation, is it a buy or sell post earnings? Find out in our free research report.
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