QuinStreet (QNST) Q2 2025 earnings summary

Executive summary

• Achieved record Q2 FY2025 revenue of $282.6M, up 130% year-over-year, driven by surging auto insurance demand and double-digit growth in other verticals.

• Auto insurance revenue rose 615% year-over-year; non-insurance client verticals grew 15% year-over-year.

• Adjusted EBITDA reached $19.4M; adjusted net income was $11.9M ($0.20 per share); GAAP net loss was $1.5M, a significant improvement from prior year.

• Gross profit margin improved to 9% from 6% year-over-year, reflecting better cost management.

• Two clients accounted for 23% and 18% of Q2 revenue, highlighting client concentration risk.

Financial highlights

• Q2 net revenue: $282.6M (+130% YoY); six months: $561.8M (+128% YoY).

• Adjusted EBITDA was $19.4M; adjusted net income was $11.9M ($0.20 per share); Q2 EPS: $(0.03) vs. $(0.21) prior year.

• Financial services client vertical (mainly auto insurance) represented 78% of Q2 revenue, growing 208% year-over-year to $219.9M; auto insurance alone grew 615% year-over-year.

• Home services client vertical represented 21% of Q2 revenue, growing 21% year-over-year to $59.6M.

• Cash and equivalents at quarter-end were $57.8M, up from $45.5M a year ago, with no bank debt.

Outlook and guidance

• Fiscal Q3 revenue expected between $265M and $275M; adjusted EBITDA between $19.5M and $20M.

• Full fiscal year 2025 revenue now expected between $1.065B and $1.105B; adjusted EBITDA between $80M and $85M.

• Management expects continued strong demand in auto insurance and growth in non-insurance verticals.

• Guidance implies strong sequential margin expansion in Fiscal Q4 as media efficiencies and growth initiatives progress.

• Excluding charges for increased contingent consideration (AquaVida), the company would have reported a return to net income in fiscal 2025.