LendingTree (TREE) risk factors, FY2024 10-K

Risks Related to our Business

1. 01Adverse conditions in the primary and secondary mortgage markets, as well as the general economy, have had and could continue to have a material adverse effect on our business, financial condition and results of operations
2. 02We depend on the financial strength of our Network Partners and our relationships with them, and any adverse changes in these relationships could adversely affect our business, financial condition and results of operations
3. 03Any adverse changes in relationships with our Network Partners, or failure to meet certain metrics required by Network Partners, could adversely affect our business
4. 04We depend on search engines, online advertising and other online sources to attract visitors to our websites, and if we are unable to attract these visitors and convert them into consumer requests for our Network Partners in a cost-effective manner, our business and financial results may be harmed
5. 05Economic conditions, including changes in the consumer lending and insurance markets could harm our business, financial condition and results of operations
6. 06Our insurance business, QuoteWizard, is significant to our revenue, and operational issues in this business could have a material impact on our results of operations
7. 07Our insurance agency businesses pose unique risks that may have a material adverse impact on our results of operations
8. 08Our small business loans are a significant product within our Consumer segment and there are risks specific to this product that could have a material impact on our results of operations
9. 09Trends in the credit card industry, as well as the impact of the general economy on the ability of users to qualify for credit cards, could harm our business, financial condition and results of operations
10. 10If we are unable to continually enhance our products and services and adapt them to technological changes and consumer and Network Partner needs, we may lose market share and revenue and our business could suffer
11. 11Additionally, our interaction with our Network Partners is dependent on the technology and services we offer to these customers. Our inability to offer competitive technology solutions to support our Network Partners could have a negative impact on our business
12. 12Some of our products are new to the market and may fail to achieve or maintain customer acceptance and profitability
13. 13If consumers do not find value in our Spring platform or other platforms, or do not like the consumer experience on the platforms, the number of matches on our platforms may decline, which would harm our business, financial condition and results of operations
14. 14We improve our products and services in ways that forego short-term gains
15. 15We may be unable to make acquisitions, successfully integrate acquired companies into our business, or our acquisitions may not meet our expectations, any of which would adversely affect our business, financial condition, and results of operations
16. 16Other acquisitions or strategic investments that we pursue may not be successful and could disrupt our business and harm our financial condition
17. 17Our financial condition and results of operations have been and may continue to be adversely affected by public health issues, including epidemics or pandemics such as COVID-19
18. 18If we fail to manage our people through the changes caused by the economic challenges, our business and results of operations could be harmed
19. 19We rely on the performance of highly skilled personnel and if we are unable to attract, retain, develop and motivate well-qualified employees, our business and results of operations could be harmed
20. 20Network Partners on our marketplaces may not provide competitive levels of service to consumers, which could materially and adversely affect our brands and businesses and their ability to attract consumers
21. 21A significant portion of our total revenue is derived from two Network Partners and our results of operations could be adversely affected if we lose significant business from either of these Network Partners
22. 22We have incurred significant operating losses in the past and we may not be able to generate sufficient revenue to be profitable over the long term
23. 23available as a delayed draw term loan until March 27, 2025. As of December 31, 2024, we had $115.6 million borrowings outstanding under the 2024 Term Loan
24. 24As security for its obligations under the facility, we granted a security interest to substantially all of our assets and the assets of our material subsidiaries, subject to certain exceptions

Risks Related to our Operations

1. 25Our success depends, in part, on the integrity of our systems and infrastructures. System interruption and the lack of integration and redundancy in these systems and infrastructures may have a material and adverse impact on our business, financial condition and results of operations

Risks Related to Legal, Compliance and Regulation

1. 26Failure to comply with past, existing or new laws, rules and regulations, or to obtain and maintain required licenses, could materially and adversely affect our business, financial condition and results of operations
2. 27security worldwide is continuously evolving and developing and, as a result, interpretation and implementation standards and enforcement practices are likely to remain uncertain for the foreseeable future
3. 28Failure to obtain proper business licenses or other documentation or to otherwise comply with local laws and requirements regarding marketing, sales or services, may result in civil or criminal penalties and restrictions on our ability to conduct business in that jurisdiction
4. 29Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our operating results and financial condition
5. 30Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited
6. 31We may become subject to intellectual property disputes, which are costly and may subject us to significant liability and increased costs of doing business
7. 32We may fail to adequately obtain, maintain, enforce and protect our intellectual property and similar proprietary rights or may be accused of infringing, misappropriating or otherwise violating intellectual property or similar proprietary rights of third parties
8. 33In the ordinary course of business, we are party to litigation involving contract, intellectual property and a variety of other claims, which could adversely affect our business and financial condition
9. 34Our reputation, ability to do business and consolidated financial statements may be harmed by improper conduct by our business partners
10. 35If our Network Partners fail to produce required documents for examination by, or other affiliated parties fail to make certain filings with, state regulators, we may be subject to fines, forfeitures and the revocation of required licenses
11. 36If we fail to maintain an effective system of disclosure controls and internal control over financial reporting, our ability to produce timely and accurate consolidated financial statements or comply with applicable regulations could be impaired
12. 37We may be exposed to liabilities under the Foreign Corrupt Practices Act (“FCPA”), which could have a material adverse effect on our business
13. 38Changes in the regulation of the Internet, mobile carriers and their partners could negatively affect our business
14. 39The possibility of additional future regulations, changing rule interpretations and examinations by regulatory agencies may result in more stringent compliance standards and could adversely affect the results of our operations

Risks Related to an Investment in our Common Stock

1. 40Fluctuations in our operating results, quarter-to-quarter earnings and other factors may result in significant decreases in the price of our common stock
2. 41If securities or industry analysts publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline
3. 42One holder of our common stock owns a substantial portion of our outstanding common stock, which concentrates voting control and limits your ability to influence corporate matters
4. 43The market price of our common stock could decline as a result of sales by our existing stockholders in the market, or the perception that these sales could occur. These sales might also make it more difficult for us to sell equity securities at a time and price that we deem appropriate
5. 44Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, limit attempts by stockholders to replace or remove our management and affect the market price of our common stock
6. 45We do not intend to pay any cash dividends on our common stock in the foreseeable future
7. 46Our financial results fluctuate as a result of seasonality, which may make it difficult to predict our future performance and may adversely affect our common stock price
8. 47The conditional conversion feature of our outstanding convertible senior notes, if triggered, may adversely affect our financial condition and operating results
9. 48We may not have the ability to raise the funds necessary to settle conversions of the Notes in cash or to repurchase the Notes upon a fundamental change and our future debt may contain limitations on our ability to pay cash upon conversion or repurchase of the Notes
10. 49We may not have the ability to pay off the Notes with our current cash and future cash flow, combined with our borrowing capacity under our current Credit Facility and 2024 Term Loan, or raise the funds necessary to pay off the Notes upon their maturity in July 2025
11. 50Our hedge and warrant transactions may affect the value of the Notes and our common stock
12. 51We may need additional equity, debt or other financing in the future, which we may not be able to obtain on acceptable terms, or at all, and any additional financing may result in restrictions on our operations or substantial dilution to our stockholders
13. 52We cannot guarantee that our stock repurchase program will be fully consummated or that it will enhance long-term stockholder value
14. 53If our goodwill or indefinite-lived intangible assets become impaired, we may be required to record a significant charge to earnings
15. 54If the fair value of our equity investments decrease, we will be required to record a significant charge to earnings
16. 55Charges to earnings resulting from acquisitions may adversely affect our operating results