Angi Inc. ((ANGI)) has held its Q1 earnings call. Read on for the main highlights of the call.
The recent earnings call for Angi Inc. painted a mixed picture, highlighting both positive strides in customer satisfaction and operational efficiency, alongside challenges in revenue growth. The general sentiment was optimistic about the company’s strategic initiatives, despite current revenue setbacks due to macroeconomic factors and the implementation of homeowner choice. Angi remains confident in its path to recovery and growth by 2026.
Improvement in Homeowner Net Promoter Score
The implementation of homeowner choice in January has significantly boosted the homeowner Net Promoter Score (NPS), which has moved from below negative 30 to nearly positive within two years. This improvement reflects a successful strategic shift aimed at enhancing customer satisfaction and engagement.
Pro Win Rate Increase
A notable increase in the pro win rate was observed, with a 10% jump following the homeowner choice implementation. This metric, which measures the percentage of time a professional wins a job on a lead they pay for, indicates a positive impact on professional engagement and success rates.
Cost Efficiency and Profit Growth
Angi has achieved significant cost efficiency, reducing overhead by $100 million compared to 2022. This reduction was accomplished while maintaining the necessary level of fixed cost investment needed for future growth, showcasing the company’s commitment to financial discipline.
Significant Improvement in Customer Retention
Customer retention has seen marked improvements, with an 8% increase for base cohort pros and a 16% rise for pros acquired in the last 12 months. This trend underscores the effectiveness of Angi’s strategies in retaining and engaging its professional user base.
Strong Paid Marketing Performance
The company reported strong performance in its paid marketing efforts, particularly in SCM acquisition and success across display networks and META’s ecosystem. This has contributed to improved proprietary lead growth, bolstering Angi’s market presence.
Revenue Decline Due to Homeowner Choice Implementation
The introduction of homeowner choice has led to a decline in revenue, with a 33% drop in network service requests and a 57% decrease in network leads. This shift has impacted lead volume, presenting a short-term challenge to Angi’s financial performance.
International Revenue Challenges
Angi faced international revenue challenges due to changes in the Canadian business model and regulatory impacts in Europe, including a 5% to 8% network impact from ID checks. These factors have contributed to a decline in international revenue.
Macroeconomic Headwinds Impacting Homeowner Volume
Macroeconomic headwinds have modestly reduced homeowner volume and job size, affecting revenue by 3 to 5 percentage points. These external factors pose additional challenges to Angi’s revenue growth.
Forward-Looking Guidance
Looking ahead, Angi anticipates a return to revenue growth by 2026, driven by an increase in revenue per lead and growth in proprietary lead volume. The company is focusing on enhancing customer experience and operational efficiency, with a strategic shift to monthly active pro metrics and improved pro retention rates.
In summary, Angi Inc.’s earnings call highlighted a blend of optimism and challenges. While the company faces revenue declines due to strategic shifts and macroeconomic pressures, it remains focused on long-term growth through customer satisfaction and operational efficiency improvements. Angi’s strategic initiatives are expected to pave the way for recovery and growth by 2026.