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hosted its Q3 2024 earnings call on Nov 4. Key highlights:

• EverQuote’s focus on the P&C insurance market is paying off due to the industry’s recovery and strong execution. As auto insurers are seeing better profits, they’ve restarted advertising, boosted budgets, and expanded coverage areas on EverQuote’s platform. The team has worked closely with these insurers to support their return, helping them get back into the market faster. “Our team has partnered deeply with carriers to find creative ways to support their reentry into the marketplace, helping accelerate progress for several important carriers.”
• The local agent distribution channel saw double-digit growth, nearing record-high revenue levels.
• The home insurance vertical grew by 30% year-over-year, reflecting solid execution in a shifting environment. We’re advancing technology modernization, streamlining platforms across the business.
• Key platform milestones included the completion of its new site platforms and a major release of the updated agent platform.
• Total revenue for Q3 was $144.5 million, marking a 163% increase year-over-year, largely fueled by a 40% sequential rise in enterprise carrier spending, which was nearly 8x higher than in Q3 2023. Revenue from the auto insurance vertical reached $130 million (up 200% year-over-year), while the home and renters insurance vertical contributed $14.1 million, up 30% year-over-year. Variable Marketing Margin (VMM) for the quarter was $43.9 million, an increase of approximately 125% from Q3 2023.
• Mayank Tandon from Needham & Company asked how new regulations requiring consumer consent for telephonic outreach would impact EverQuote’s business. CEO Jayme Mendal explained that the rule, affecting about 25-30% of their business, may lead to fewer leads but improve lead quality, as consumers who explicitly opt-in will be more engaged, allowing agents to pay more for higher-quality leads. CFO Joseph Sanborn added that while this regulation could reduce growth between Q4 and Q1, it is expected to stabilize by mid-year, with some pressure on VMM initially.
• Tandon also inquired about the duration of growth from carriers entering new states before EverQuote shifts to focus more on capturing existing budgets. CFO Joseph Sanborn responded that, while the recovery has been strong, it’s driven by a limited number of carriers so far. With the auto insurance industry seeing healthier underwriting ratios, most carriers (except one) are losing market share and are now more open to growth. He anticipates further recovery into next year as more carriers expand geographically, with major states like California potentially reactivating. Sanborn estimates they are “mid to late innings” in the recovery process.
• Charles Peters from Raymond James & Associates asked about EverQuote’s new bidding technology and agent platform, specifically how it integrates with existing agency management systems. CEO Mendal explained that EverQuote has simplified its technology to support growth and focus on specific P&C use cases. The company now uses AI-driven traffic bidding and recently launched a new agent platform to deliver features to agents. While the platform currently focuses on delivering referral products and integrates with some agency management systems, it operates independently, with plans for further feature expansion to meet more agent needs over time.
• CFO Sanborn highlighted EverQuote’s focus on building cash and maintaining a cash flow-positive business. They plan to continue generating free cash flow and may explore M&A to support growth in the P&C vertical, especially given challenges in the insurtech market. Any acquisition would align with EverQuote’s core strategy to enhance cash flow, EBITDA, and client success. “And the way we think about it is, the landscape has changed a lot in terms of the private insurtech market. Many of them have been challenged at raising additional rounds of capital, and there’s an opportunity for us potentially to accelerate things for us and bring on additional folks who want to be part of a winning team and what we’re trying to do here at EverQuote.” – CFO Sanborn.

EverQuote’s P&C Appointments