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What changed in NERDWALLET, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of NERDWALLET, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+262 added−281 removedSource: 10-K (2025-02-19) vs 10-K (2024-02-20)

Top changes in NERDWALLET, INC.'s 2024 10-K

262 paragraphs added · 281 removed · 209 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

55 edited+14 added−9 removed88 unchanged
Biggest changeOur Platform We have developed a consumer-first platform that empowers consumers and SMBs to make well-informed financial decisions at the right time and with confidence. The cornerstone of our platform is consumer trust in the independent, objective, and relevant guidance we provide, free of charge.
Biggest changeA 2024 Experian study revealed that 66% of consumers said they'd like to expand their knowledge of credit and personal finance, with even higher percentages among Gen Z (80%) and Millennials (79%). 4 Table of Contents Our Platform We have developed a consumer-first platform that empowers consumers and SMBs to make well-informed financial decisions at the right time and with confidence.
Our distinct ability to combine our trusted brand and massive top-of-funnel reach with best-in-class user experiences helps us vertically integrate in areas and topics that capture re-occurring revenue. For example, in 2020, we acquired Fundera to improve our offering for SMBs. Upon integration, we combined NerdWallet’s top-of-funnel strength with Fundera’s monetization strategy, which added a recurring revenue tail.
Our distinct ability to combine our trusted brand and massive top-of-funnel reach with best-in-class user experiences helps us vertically integrate in areas and topics that capture re-occurring revenue. For example, in 2020, we acquired Fundera, Inc, (Fundera) to improve our offering for SMBs. Upon integration, we combined NerdWallet’s top-of-funnel strength with Fundera’s monetization strategy, which added a recurring revenue tail.
As digital advertising spend continues to increase as a percentage of overall advertising spend, we expect our addressable market opportunity to grow along with it. We believe the services provided by financial advisors, insurance agencies, loan brokers and others will increasingly transition online in the coming years, which will expand our addressable market.
As digital advertising spend continues to increase as a percentage of overall advertising spend, we expect our addressable market opportunity to grow along with it. We believe the services provided by financial advisors, insurance agencies, loan brokers, mortgage brokers and others will increasingly transition online in the coming years, which will expand our addressable market.
We also believe there is significant potential for us to grow the global reach of our platform. Our success in the United States and our strong brand give us a solid foundation to expand our international footprint in markets like the United Kingdom in 2020, Canada in 2021 and Australia in 2022. • Vertical Integration.
We also believe there is significant potential for us to grow the global reach of our platform. Our success in the United States and our strong brand give us a solid foundation to expand our international footprint in markets like the UK in 2020, Canada in 2021 and Australia in 2022. • Vertical Integration.
This year, we held two Nerds Pay It Forward events, freeing up time in support of employee volunteerism on dedicated volunteer days to encourage all NerdWallet employees to give back to their communities. In all, Nerds donated over 1,800 hours during these events.
This year, we held two Nerds Pay It Forward events, freeing up time in support of employee volunteerism on dedicated volunteer days to encourage all NerdWallet employees to give back to their communities. In all, Nerds donated over 1,700 hours during these events.
We have a team focused on ingesting and aggregating data from our financial services partners across our verticals and financial products to surface and apply product details and attributes for matching with consumers. Our partner data ingestion, quality and compliance processes ensures accuracy and scalability across our platform.
We have a team focused on ingesting and aggregating data from our financial services partners across our verticals and financial products to surface and apply product details and attributes for matching with consumers. Our partner data ingestion, quality and compliance processes ensure accuracy and scalability across our platform.
Examples include, but are not limited to: • For credit card products, our approval odds model determines a consumer's likelihood of getting approved, which ultimately saves them time, enables users to avoid unnecessary hard credit checks, and drives stronger conversion rates for our financial services partners. • For some loans products, we operate a prequalification system that assists consumers through the underwriting process.
Examples include, but are not limited to: • For credit card products, our approval odds model determines a consumer's likelihood of getting approved, which ultimately saves them time, enables users to avoid unnecessary hard credit checks, and drives stronger conversion rates for our financial services partners. 9 Table of Contents • For some loans products, we operate a prequalification system that assists consumers through the underwriting process.
Our writers and editors, many of whom have joined us from notable publications, cover specific verticals day in and day out, and, as a result, are deeply knowledgeable about the financial areas they cover, producing high-quality and award-winning guidance.
Our writers and editors, many of whom have joined us from notable publications, cover specific verticals day in and day out, and, as a result, are deeply knowledgeable about the financial areas they cover, producing high-quality guidance.
In addition, we routinely post on our investor relations website news releases, announcements and other statements about our business and results of operations, some of which may contain information that may be deemed material to investors. Therefore, we encourage investors to monitor the https://investors.nerdwallet.com website and review the information we post on that page.
In addition, we routinely post on our investor relations website news releases, announcements and other statements about our business and results of operations, some of which may contain information that may be deemed material to investors. Therefore, we encourage investors to monitor the https://investors.nerdwallet.com website and review the information we post on that page. 14 Table of Contents
As we look to add capabilities within our existing verticals and enter new verticals like Medicare and cryptocurrency, our brand paves the way for us to meet consumer demand. By improving the quality of our guidance within existing verticals, we believe we can enhance the experience for our users and continue to build recurring revenue streams.
As we look to add capabilities within our existing verticals and enter new verticals, our brand paves the way for us to meet consumer demand. By improving the quality of our guidance within existing verticals, we believe we can enhance the experience for our users and continue to build recurring revenue streams.
Similar to the vertical integration approach utilized with Fundera, we believe that by pairing On the Barrelhead’s loan matching platform with NerdWallet’s trusted brand and massive reach, we can offer our users more personalized and compelling recommendations, leading to better customer experiences and improved monetization.
Similar to the vertical integration approach utilized with Fundera, we believe that by pairing OTB’s loan matching platform with NerdWallet’s trusted brand and massive reach, we can offer our users more personalized and compelling recommendations, leading to better customer experiences and improved monetization.
As of December 31, 2023, we had over 730 full‑time employees, of which approximately 95% are located throughout the United States and 5% are located internationally. None of our employees are represented by a labor union or covered by collective bargaining agreements. We consider our relationship with our employees to be good and have not experienced any work stoppages.
As of December 31, 2024, we had over 650 full‑time employees, of which approximately 95% are located throughout the United States and 5% are located internationally. None of our employees are represented by a labor union or covered by collective bargaining agreements. We consider our relationship with our employees to be good and have not experienced any work stoppages.
We believe we compete favorably due to the breadth and depth of our financial guidance, the trust we’ve built with our consumers, and our brand, organic traffic, convenience and simplicity. 12 Table of Contents Intellectual Property We believe that our intellectual property rights are valuable and important to our business.
We believe we compete favorably due to the breadth and depth of our financial guidance, the trust we’ve built with our consumers, and our brand, organic traffic, convenience and simplicity. Intellectual Property We believe that our intellectual property rights are valuable and important to our business.
Consumers can get a holistic view of their finances, and hone in on specific details about their spending and saving patterns across accounts.
Consumers can get a holistic view of their finances, and home in on specific details about their spending and saving patterns across accounts.
For example, while some consumers may be looking for the lowest interest rate on a credit card, others may never plan to carry a balance and instead may be looking for the best cash back or rewards offering. • Acting as a Trusted Guide and Navigator, Providing Personalized Guidance.
For example, while some consumers may be looking for the lowest interest rate on a credit card, others may never plan to carry a balance and instead may be looking for the best cash back or rewards offering. 5 Table of Contents • Acting as a Trusted Guide and Navigator, Providing Personalized Guidance.
We have made significant progress in our efforts, and since 2016, we have started converting unique users into registered users that utilize our consumer decisioning tools and increased machine learning functionality. We had registered users of 10 million as of December 31, 2021, over 14 million as of December 31, 2022 and over 19 million as of December 31, 2023.
We have made significant progress in our efforts, and since 2016, we have started converting unique users into registered users that utilize our consumer decisioning tools and increased machine learning functionality. We had registered users of 14 million as of December 31, 2022, over 19 million as of December 31, 2023 and 25 million as of December 31, 2024.
Additionally, On the Barrelhead’s loan-matching platform unlocks more personalized and compelling recommendations, leading to better customer experiences and improved monetization. Our technology is flexible enough to engage with financial services partners in ways that align with each industry’s unique requirements and business practices.
Additionally, OTB’s loan-matching platform unlocks more personalized and compelling recommendations, leading to better customer experiences and improved monetization. Our technology is flexible enough to engage with financial services partners in ways that align with each industry’s unique requirements and business practices.
As a result, aspects of our business are potentially subject to a variety of U.S., UK and Canadian laws and regulations, including: • The Truth-in-Lending Act, the Equal Credit Opportunity Act, the Fair Credit Reporting Act (FCRA), Fair and Accurate Credit Transactions Act of 2003, the Fair Housing Act, the Real Estate Settlement Procedures Act, and similar state laws, all of which place certain restrictions on the manner in which mortgages and other consumer loans are marketed and originated, and some of which impose restrictions on the amount and nature of fees that may be charged to lenders and real estate professionals for providing or obtaining consumer loan requests; • The Dodd-Frank Wall Street Reform and Consumer Protection Act, which imposes, among other things, a broad prohibition on Unfair, Deceptive and Abusive Acts and Practices (UDAAPs) in connection with consumer financial products and services, limitations on fees charged by mortgage lenders, and requirements related to mortgage disclosures and is enforced by the Consumer Financial Protection Bureau and state regulatory authorities; • The Federal Trade Commission Act (FTC Act), which, among other things, imposes a broad prohibition on Unfair and Deceptive Acts and Practices in or affecting commerce, and is enforced by the Federal Trade Commission and Canada’s Competition Act; • State laws that impose prohibitions on Unfair, Deceptive and Abusive Acts and Practices similar to the Dodd-Frank Act and FTC Act’s prohibitions; • Federal, state and provincial licensing laws; • Federal and state laws, which impose restrictions on activities conducted through telephone, mail, email, mobile device or the Internet, including the Telemarketing Sales Rule, the Telephone Consumer Protection Act, the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003, and Canada’s Anti-Spam Legislation (CASL); • Federal and state laws relating to offering of credit repair services to consumers, including such laws that impose restrictions on the usage and storage of consumer credit information such as the Credit Repair Organizations Act and the FCRA; • Federal and state laws and regulations relating to data privacy and security, such as the Gramm-Leach-Bliley Act and the California Consumer Privacy Act (CCPA), which impact how we collect, use, store, share and otherwise process personal information of consumers and other individuals; • Recent state laws regulating data privacy and security such as the CCPA; and • Foreign laws and regulations relating to data privacy and security, such as the UK General Data Protection Regulation, the UK Data Protection Act 2018 and the General Data Protection Regulation 2016/679, each of which regulates our collection, processing, disclosure and other use of data relating to identifiable living individuals (personal data). 13 Table of Contents Available Information We maintain an investor relations website at the following address: https://investors.nerdwallet.com .
As a result, aspects of our business are potentially subject to a variety of U.S., UK and Canadian laws and regulations, including: • The Truth-in-Lending Act (TILA), the Equal Credit Opportunity Act (ECOA), the Fair Credit Reporting Act (FCRA), Fair and Accurate Credit Transactions Act of 2003, the Fair Housing Act (FHA), the Real Estate Settlement Procedures Act (RESPA), and similar state laws, all of which place certain restrictions on the manner in which mortgages and other consumer loans are marketed and originated, and some of which impose restrictions on the amount and nature of fees that may be charged to lenders and real estate professionals for providing or obtaining consumer loan requests; • The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), which imposes, among other things, a broad prohibition on Unfair, Deceptive and Abusive Acts and Practices (UDAAPs) in connection with consumer financial products and services, limitations on fees charged by mortgage lenders, and requirements related to mortgage disclosures and is enforced by the Consumer Financial Protection Bureau (CFPB) and state regulatory authorities; • The Federal Trade Commission Act (FTC Act), which, among other things, imposes a broad prohibition on Unfair and Deceptive Acts and Practices in or affecting commerce, and is enforced by the Federal Trade Commission (FTC) and Canada’s Competition Act; • State laws that impose prohibitions on Unfair, Deceptive and Abusive Acts and Practices similar to the Dodd-Frank Act and FTC Act’s prohibitions; • Federal, state and provincial licensing laws; 13 Table of Contents • Federal and state laws, which impose restrictions on activities conducted through telephone, mail, email, mobile device or the Internet, including the Telemarketing Sales Rule, the Telephone Consumer Protection Act, the Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003, and Canada’s Anti-Spam Legislation; • Federal and state laws relating to offering of credit repair services to consumers, including such laws that impose restrictions on the usage and storage of consumer credit information such as the Credit Repair Organizations Act and FCRA; • Federal and state laws and regulations relating to data privacy and security, such as the Gramm-Leach-Bliley Act (GLBA) and the California Consumer Privacy Act (CCPA), which impact how we collect, use, store, share and otherwise process personal information of consumers and other individuals; • Recent state laws regulating data privacy and security such as the CCPA; and • Foreign laws and regulations relating to data privacy and security, such as the UK General Data Protection Regulation, the UK Data Protection Act 2018 and the General Data Protection Regulation 2016/679, each of which regulates our collection, processing, disclosure and other use of data relating to identifiable living individuals (personal data).
Today, we have financial services partners in eight financial verticals: credit cards, mortgages, insurance, SMB products, personal loans, banking, investing and student loans. We partner with hundreds of organizations, ranging from the largest financial services providers to the most disruptive startups.
Today, we have financial services partners in a variety of financial verticals, including credit cards, mortgages, insurance, SMB products, personal loans, banking, investing and student loans. We partner with hundreds of organizations, ranging from the largest financial services providers to the most disruptive startups.
Our current and primary addressable market opportunity is U.S. financial services digital advertising spend, which is expected to be more than $30 billion in 2023 and has been growing at double digit rates annually, according to eMarketer.
Our current and primary addressable market opportunity is U.S. financial services digital advertising spend, which is expected to be more than $36 billion in 2024 and has been growing at double digit rates annually, according to eMarketer.
Democratizing access to financial guidance is only half of our vision; the other half is to make it frictionless for consumers to make financial decisions. We built our platform to appeal to both consumers looking to “do it themselves,” as well as those looking for more support managing their financial well-being.
Democratizing access to financial guidance is only half of our vision; the other half is to make it frictionless for consumers to make financial decisions. We built our platform to appeal both to consumers looking to “do it themselves” and those looking for more support managing their financial well-being.
Once employees are at NerdWallet we invest in their well-being and development offering competitive compensation and benefits, opportunities for career growth, and inclusion and belonging programming. • Training, Learning and Development - In line with our Relentless Self-Improvement value, we encourage our employees to seek out professional development opportunities and we provide them with a yearly career enrichment stipend.
Once employees are at NerdWallet we invest in their well-being and development offering competitive compensation and benefits, opportunities for career growth, and inclusion and belonging programming. • Training, Learning and Development - In line with our Relentless Self-Improvement value, we encourage our employees to seek out professional development opportunities.
Our key initiatives include: • Offering learning sessions and resources for Nerds and managers to help build an inclusive workplace. • Supporting eight employee-led employee resource groups, which provide supportive community and development opportunities for various employee populations and their allies: NerdOut, NerdFamilies, NerdWomen, Allyship, Asian Nerds, Black Nerds, Latino and Hispanic Nerds, and Women in Data and Engineering. • We began 2023 with a new bronze-level certification from Black Equity at Work from Management Leadership for Tomorrow.
Our key initiatives include: • Offering learning sessions and resources for Nerds and managers to help build an inclusive workplace. • Supporting eight employee-led employee resource groups, which provide supportive community and development opportunities for various employee populations and their allies: NerdOut, NerdFamilies, NerdWomen, Nerd Allies, Asian Nerds, Black Nerds Network, Viva Nerds, and Women in Data and Engineering. • We began 2024 with a new silver-level certification from Black Equity at Work from Management Leadership for Tomorrow.
To ensure we are able to meet distinct consumer needs and preferences, our financial guidance is delivered in a variety of ways, organized in the following core categories: Learn, Shop and Manage. • Learn.
To ensure we are able to meet distinct consumer needs and preferences, our financial guidance and products are delivered in a variety of ways, organized in the following core categories: Learn, Shop and Manage. 8 Table of Contents • Learn.
Talent Attraction, Recruitment and Retention Our remote-first culture allows us to reach, attract and retain more diverse talent across all levels of our organization. Attracting and retaining highly skilled, diverse talent is a key component of our burgeoning diversity, equity and inclusion efforts, and is absolutely critical to our success as a business and to fully realizing NerdWallet’s mission.
Talent Attraction, Recruitment and Retention Our remote-first culture allows us to reach, attract and retain more diverse talent across all levels of our organization. Attracting and retaining highly skilled, diverse talent is absolutely critical to our success as a business and to fully realizing NerdWallet’s mission.
Our diversity, equity, inclusion and belonging (DEIB) efforts are centered around ensuring we are building a diverse organization across all business aspects and creating an inclusive culture where everyone is engaged and has access to opportunities.
Our diversity, equity, inclusion and belonging (DEIB) efforts are centered around ensuring we are building a diverse organization across all business aspects and creating an inclusive culture where everyone is engaged and empowered to do their best work.
This rigorous three-year route to certification features a data-driven and comprehensive plan to drive and support racial equity at NerdWallet. • We use a third-party platform to analyze our employee salaries for gaps based on race or gender twice a year. • Offering Learning and Activism Days to inspire and encourage Nerds to learn,grow and give back to their communities.
This rigorous three-year route to certification features a data-driven and comprehensive plan to drive and support racial equity at NerdWallet. • We use a third-party platform to analyze our employee salaries to ensure pay parity. 11 Table of Contents • Offering Learning and Activism Days to inspire and encourage Nerds to learn,grow and give back to their communities.
By codifying insights from our award-winning editorial team, we are able to recommend smart money moves via contextual “nudges” for example, letting consumers know that the improvement in their credit score means that they could qualify for lower auto insurance rates.
By codifying insights from our award-winning editorial team, we are able to recommend smart money moves via contextual “nudges” for example, letting consumers know that the improvement in their credit score means that they could qualify for lower auto insurance rates. As a result, NerdWallet has become a one-stop-shop for consumers to track, manage and plan their financial futures.
This alignment of interests, enabled by our unbiased and trusted guidance, benefits consumers, the financial services partners and NerdWallet. 4 Table of Contents We built NerdWallet with the following key assumptions: • Everything starts with trust; • Consumers have an unmet need for unbiased guidance to inform their financial decisions; and • There is a compelling opportunity to use data to personalize and automate guidance at scale.
We built NerdWallet with the following key assumptions: • Everything starts with trust; • Consumers have an unmet need for unbiased guidance to inform their financial decisions; and • There is a compelling opportunity to use data to personalize and automate guidance at scale.
Our high quality content is distributed by news sites such as The Associated Press, and our writers are frequently featured providing guidance in print, online and broadcast media such as The New York Times and Good Morning America, among others.
Our writers are frequently featured providing guidance in print, online and broadcast media such as The New York Times and Good Morning America, among others.
Our marketing strategy is diversified across brand marketing, organic and performance marketing, customer relationship management and communications. Importantly, these strategies build on and reinforce one another, optimizing for building consumer trust and managing spend efficiently.
Marketing Our marketing function is a critical way we reach and build trust with consumers and is an important growth lever for our business. Our marketing strategy is diversified across brand marketing, organic and performance marketing, customer relationship management and communications. Importantly, these strategies build on and reinforce one another, optimizing for building consumer trust and managing spend efficiently.
We attract people who are passionate about bringing our mission to life and inspired by the possibility of making real change—to brighten futures, ask hard questions, usher in solutions and provide our consumers with clarity and confidence.
Employees and Human Capital NerdWallet is defined by its vision, a world where everyone makes financial decisions with confidence. We attract people who are passionate about bringing our mission to life and inspired by the possibility of making real change—to brighten futures, ask hard questions, usher in solutions and provide our consumers with clarity and confidence.
Our ESG strategy is founded on three pillars: • Achieving Our Vision, or the work we do to create a world in which everyone makes financial decisions with confidence.
You can find the report at https://www.nerdwallet.com/l/environmental-social-governance . Our ESG strategy is founded on three pillars: • Achieving Our Vision, or the work we do to create a world in which everyone makes financial decisions with confidence.
Our Nerds are eager to make an impact, and we want to empower them in pursuit of our shared and individual goals. • Building a Socially Responsible Business, or the work we do to ensure that our business practices protect and improve the lives of our consumers, our Nerds, and our wider world. 10 Table of Contents Employees and Human Capital NerdWallet is defined by its vision, a world where everyone makes financial decisions with confidence.
Our Nerds are eager to make an impact, and we want to empower them in pursuit of our shared and individual goals. • Building a Socially Responsible Business, or the work we do to ensure that our business practices protect and improve the lives of our consumers, our Nerds, and our wider world.
In addition, we compete with the following for advertising budgets designated for financial products: • Financial services providers’ own marketing : Financial services providers connect directly through many different channels, digitally (in-app, email, etc.) and offline channels (direct mail, printed media, etc.); • Online search engines : Financial services providers spend advertising budgets with online search engines, primarily Google AdWords, as many consumers turn to Google to answer their personal finance questions; and • Online marketplaces : including Bankrate, Credit Karma, LendingTree and Zillow.
News & World Report and other print and broadcast media; • Friends and family , as many consumers consult friends and family for financial guidance; • Influencers on social media platforms ; and 12 Table of Contents • Traditional financial and depository institutions, non-bank loan originators and other small and medium-sized mortgage brokers In addition, we compete with the following for advertising budgets designated for financial products: • Financial services providers’ own marketing : Financial services providers connect directly through many different channels, digitally (in-app, email, etc.) and offline channels (direct mail, printed media, etc.); • Online search engines : Financial services providers spend advertising budgets with online search engines, primarily Google AdWords, as many consumers turn to Google to answer their personal finance questions; and • Online marketplaces including Bankrate, Credit Karma, LendingTree and Zillow.
Given it is incredibly difficult for any one person to be deeply knowledgeable across all areas of personal finance, we have a 100+ person editorial team that functions as the “brains” behind our guidance.
The cornerstone of our platform is consumer trust in the independent, objective, and relevant guidance we provide, free of charge. Given it is incredibly difficult for any one person to be deeply knowledgeable across all areas of personal finance, we have an award-winning editorial team that functions as the “brains” behind our guidance.
As a result, NerdWallet has become a one-stop-shop for consumers to track, manage and plan their financial futures. 8 Table of Contents Our Technology We built our scalable technology platform to serve both the growing number of consumers searching for financial products digitally and the increasing number of financial service providers looking to reach consumers with the right characteristics for any given product.
Our Technology We built our scalable technology platform to serve both the growing number of consumers searching for financial products digitally and the increasing number of financial service providers looking to reach consumers with the right characteristics for any given product.
Through our platform, our financial services partners can reach a substantial audience—we had 23 million Monthly Unique Users (MUUs) per month on average in 2023. After doing research on our platform, these consumers are better informed about the financial decision they’re about to make and often primed and ready to transact.
Through our platform, our financial services partners can reach a substantial audience with millions of consumers and SMBs visiting every month. After doing research on our platform, these consumers are better informed about the financial decision they’re about to make and often primed and ready to transact.
Our security team has a wide range of expertise, from corporate security to network security to application security, giving us the ability to design security into everything that we do, from product development to vendor selection to the tools that we use in our day-to-day work as Nerds. 9 Table of Contents Marketing Our marketing function is a critical way we reach and build trust with consumers and is an important growth lever for our business.
Our security team has a wide range of expertise, from corporate security to network security to application security, giving us the ability to design security into everything that we do, from product development to vendor selection to the tools that we use in our day-to-day work as Nerds.
For example, a consumer researching credit cards may see a relevant article regarding mortgages, then remember that article when they are in the market for a mortgage at a later date.
Through the wide range of guidance that we offer, consumers are exposed to relevant products outside of the one they are researching at a given time. For example, a consumer researching credit cards may see a relevant article regarding mortgages, then remember that article when they are in the market for a mortgage at a later date.
Throughout 2023, our Content Nerds reinforced trust by helping consumers make informed financial decisions across a variety of areas, including budgeting and spending in an inflationary environment; finding insurance coverage in a complex marketplace; and navigating the continued impact of interest rate hikes on credit cards, mortgages, bank accounts and personal loans, as well as volatility in student loan forbearance and repayment. 5 Table of Contents Benefits of Our Platform for Our Partners We bring our financial services partners well-matched and well-informed consumers.
Throughout 2024, our Content Nerds reinforced trust by helping consumers make informed financial decisions across a variety of areas, including budgeting and spending in an inflationary environment; finding insurance coverage in a complex marketplace; and navigating the current interest rate landscape, as well as volatility in student loan forbearance and repayment.
As a result, consumers are exposed to our financial services partners’ products at various points in their financial journey, increasing the value of our platform both to consumers and financial services partners. 6 Table of Contents Our Growth Pillars We believe our ability to execute against our strategy and invest in our three pillars of growth- “Land and Expand,” “Vertical Integration,” and “Registrations and Data-Driven Engagement”- helps us advance toward becoming a trusted financial ecosystem.
Our Growth Pillars We believe our ability to execute against our strategy and invest in our three pillars of growth- “Land and Expand,” “Vertical Integration,” and “Registrations and Data-Driven Engagement”- helps us advance toward becoming a trusted financial ecosystem.
We believe our marketing strategy will position NerdWallet as the trusted brand of choice in personal finance, improve traffic acquisition at all levels of the funnel, drive engagement with users, and enable us to scale quickly across new consumer finance verticals and geographies.
We believe our marketing strategy will position NerdWallet as the trusted brand of choice in personal finance, improve traffic acquisition at all levels of the funnel, drive engagement with users, and enable us to scale quickly across new consumer finance verticals and geographies. 10 Table of Contents Environmental, Social and Governance Our mission, to provide clarity for all of life’s financial decisions, is rooted in our belief that both individual consumers and SMBs should be empowered to make financial decisions with confidence.
The information on our investor relations website is not incorporated by reference in this report. We make available on or through our investor relations website certain reports and amendments to those reports that we file with or furnish to the SEC in accordance with the Exchange Act.
We make available on or through our investor relations website certain reports and amendments to those reports that we file with or furnish to the SEC in accordance with the Exchange Act. These include our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K.
In 2023, SMB products revenue grew 11% year-over-year despite a challenging loans macroeconomic environment as they successfully directed organic traffic through an efficient funnel. Given our success in SMB, we furthered our vertical integration efforts in 2022 through our acquisition of On the Barrelhead, a loan matching platform that provides consumers and SMBs with product recommendations.
Given our success in SMB, we furthered our vertical integration efforts in 2022 through our acquisition of On the Barrelhead (OTB), a loan matching platform that provides consumers and SMBs with product recommendations.
In 2023, we published our second annual Environmental, Social and Governance (ESG) report, outlining our corporate social responsibility programs, diversity, equity, and inclusion efforts, and our first environmental and sustainability strategy, specifically our Scope 1, 2, and 3 emissions.
As a mission-driven, consumer-first company, we have long had a company culture oriented towards being responsible and socially conscious. In 2024, we published our third annual ESG report, outlining our corporate social responsibility programs, diversity, equity, and inclusion efforts, and our first environmental and sustainability strategy, specifically our Scope 1, 2, and 3 emissions.
This creates a unique value proposition for all constituents in our ecosystem, making our platform more valuable. 7 Table of Contents Our Market Opportunity We have a substantial market opportunity in the growing global market for financial services.
This creates a unique value proposition for all constituents in our ecosystem, making our platform more valuable. Our Market Opportunity We have a substantial market opportunity in the growing global market for financial services. Our comprehensive platform serves a broad set of financial verticals, including credit cards, mortgages, insurance, SMB products, personal loans, banking, investing and student loans.
As a result, we believe that our financial services partners greatly benefit from placement on our Best-of Awards lists, in our reviews and within other NerdWallet content. In fact, 66% of the financial services providers who won a 2023 Best-of Award promoted their designation in their own marketing efforts. • Exposure to Consumers Seeking a Broader Range of Financial Products.
As a result, we believe that our financial services partners greatly benefit from placement on our Best-of Awards lists, in our reviews and within other NerdWallet content.
The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at the following address: https://www.sec.gov .
We make this information available on our investor relations website free of charge as soon as reasonably practicable after we electronically file the information with, or furnish it to, the SEC. The SEC maintains a website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at the following address: https://www.sec.gov .
In fact, we have seen two times the increase in our match rate with personal loans financial providers after integrating OTB technology. • Registration and Data-Driven Engagement.
In fact, we have seen two times the increase in our match rate with personal loans financial providers after integrating OTB technology. Additionally, in late 2024 we acquired NDL, a mortgage brokerage, to provide our consumers with more hands-on guidance through the mortgage shopping experience. 7 Table of Contents • Registration and Data-Driven Engagement.
These consumers also frequently have desirable characteristics—they have higher credit scores and maintain higher levels of investable assets—making them highly attractive for our financial services partners. We have received feedback from financial services partners that our users ’ approval rates can be significantly higher than those applying through other channels .
Benefits of Our Platform for Our Partners We bring our financial services partners well-matched and well-informed consumers. These consumers also frequently have desirable characteristics—they have higher credit scores and maintain higher levels of investable assets—making them highly attractive for our financial services partners.
In addition, we provide in-house opportunities for career development, including a job shadowing program, career conversations, cohort-based learning, on-demand courses, and in-depth training as part of our Career Accelerator Program (CAP) and Leadership Empowerment Accelerator Program (LEAP) aimed to increase representation of underrepresented races and ethnicities, women in leadership and women in tech and propel underrepresented women into leadership positions. 11 Table of Contents • Compensation - NerdWallet offers market-competitive compensation to attract employees and a pay-for-performance philosophy to engage and retain our employees.
In addition, we provide in-house opportunities for career development, including a job shadowing program, career conversations, cohort-based learning, on-demand courses, and a career readiness series as part of our Career Accelerator Program (CAP) designed to invest in our early to mid-career talent in individual contributor roles and provide them with the tools and resources needed to thrive at NerdWallet. • Compensation - NerdWallet offers market-competitive compensation to attract employees and a pay-for-performance philosophy to engage and retain our employees.
Given the breadth of our expertise, consumers are able to use our platform for multiple facets of their financial well-being beyond their initial transactions. Through the wide range of guidance that we offer, consumers are exposed to relevant products outside of the one they are researching at a given time.
In fact, over 100 partner advertising campaigns leveraged the best-of badge, underscoring the weight that a NerdWallet evaluation carries. 6 Table of Contents • Exposure to Consumers Seeking a Broader Range of Financial Products. Given the breadth of our expertise, consumers are able to use our platform for multiple facets of their financial well-being beyond their initial transactions.
In 2023, we published our second annual Environmental, Social and Governance (ESG) report, outlining our corporate social responsibility programs, diversity, equity, and inclusion efforts, and our first environmental and sustainability strategy, specifically our Scope 1, 2, and 3 emissions. You can find the report at https://www.nerdwallet.com/l/environmental-social-governance .
In 2024, we published our annual Environmental, Social and Governance (ESG) report, outlining our corporate social responsibility programs, diversity, equity, and inclusion efforts, and our environmental and sustainability strategy and emissions. Our revenue was $687.6 million and $599.4 million for 2024 and 2023, respectively, representing year-over-year growth of 15%.
We generated a net loss of $11.8 million for 2023, which increased 16% from a net loss of $10.2 million for 2022. 3 Table of Contents Industry Trends in Our Favor Many trends are transforming the way consumers and SMBs manage their finances and several of these trends accelerated in 2020 during the COVID-19 pandemic, creating tailwinds in our industry.
As of December 31, 2024, NDL is licensed to operate in 25 states, further strengthening our ability to serve homebuyers and homeowners nationwide. Industry Trends in Our Favor Many trends are transforming the way consumers and SMBs manage their finances and several of these trends accelerated in 2020 during the COVID-19 pandemic, creating tailwinds in our historical businesses.
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Our commitments are a natural extension of our mission and while ESG considerations have been part of the NerdWallet story since our inception, this report allows us to articulate our vision and priorities clearly, and it ensures we hold ourselves accountable for progress on critical ESG initiatives.
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We generated net income of $30.4 million for 2024, as compared to a net loss of $11.8 million for 2023. 3 Table of Contents Recent Acquisition In October 2024, we expanded our presence in the mortgage space with the acquisition of Next Door Lending LLC (NDL), a mortgage brokerage specializing in home purchase and refinancing solutions.
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Our revenue was $599.4 million and $538.9 million for 2023 and 2022, respectively, representing year-over-year growth of 11%.
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NDL provides a wide range of loan products, including conventional, Fair Housing Authority (FHA), Department of Veterans Affairs (VA), and U.S. Department of Agriculture (USDA) home loans, designed to meet the diverse financial needs of borrowers.
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Even among the newest Gen Z consumers, many of whom may not have much experience with personal finance or own a credit card, 89% surveyed in a 2021 Tallo study said that it’s a priority for them to learn about personal finance and 75% are interested in taking personal finance classes.
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As a mortgage broker, NDL focuses on personalized loan matching, helping clients navigate home financing options by evaluating creditworthiness and offering tailored guidance on loan structures. Borrowers can choose from fixed and adjustable-rate mortgages based on their financial goals. Through NDL, we connect consumers with wholesale mortgage lenders, providing competitive rates and flexible terms.
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Benefits that we provide to our financial services partners include: • Huge Audience and Reach, with an Average of 23 million Consumers Turning to the Nerds This Year. During 2023, we averaged 23 million MUUs, up 15% from 2022.
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This alignment of interests, enabled by our unbiased and trusted guidance, benefits consumers, the financial services partners and NerdWallet.
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Our comprehensive platform serves a broad set of financial verticals, including credit cards, mortgages, insurance, SMB products, personal loans, banking, investing and student loans.
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We have received feedback from financial services partners that our users ’ approval rates can be significantly higher than those applying through other channels . Benefits that we provide to our financial services partners include: • Huge Audience and Reach. We reach millions of consumers and SMBs a year.
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Environmental, Social and Governance Our mission, to provide clarity for all of life’s financial decisions, is rooted in our belief that both individual consumers and SMBs should be empowered to make financial decisions with confidence. As a mission-driven, consumer-first company, we have long had a company culture oriented towards being responsible and socially conscious.
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As a result, consumers are exposed to our financial services partners’ products at various points in their financial journey, increasing the value of our platform both to consumers and financial services partners.
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Our commitments are a natural extension of our mission and while ESG considerations have been part of the NerdWallet story since our inception, our ESG reports allow us to articulate our vision and priorities clearly, and ensure we hold ourselves accountable for progress on critical ESG initiatives.
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In 2024 and 2023, SMB products revenue grew 9% and 11%, respectively, year-over-year despite a challenging loans macroeconomic environment as they successfully directed organic traffic through an efficient funnel.
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News & World Report and other print and broadcast media; • Friends and family , as many consumers consult friends and family for financial guidance; and • Influencers on social media platforms.
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We also committed to the Hispanic Equity at Work Certification.
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These include our Annual Reports on Form 10-K, our Quarterly Reports on Form 10-Q and our Current Reports on Form 8-K. We make this information available on our investor relations website free of charge as soon as reasonably practicable after we electronically file the information with, or furnish it to, the SEC.
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In addition to the U.S. federal, state and local laws described above, U.S. federal and state agencies have broad oversight, supervision, and enforcement authority over our mortgage business. Because we are not a depository institution, we must comply with state licensing requirements to conduct our business.
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We will incur significant ongoing costs to comply with licensing and other legal requirements under the Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act) and the Dodd‑Frank Act, among others.
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As required by state law, we have additional licenses to enable us to conduct lead generation activities, and operate our loan platforms that facilitate consumer and business loans. The licensing process includes the submission of an application to the relevant state agency, a character and fitness review of key individuals and an administrative review of our business operations.
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Our mortgage brokerage business through NDL is subject to a variety of regulatory and contractual obligations imposed by federal and state authorities, as well as by wholesale lenders and investors with whom we work to facilitate mortgage transactions. This includes compliance with regulations enforced by the CFPB, which oversees residential mortgage loan origination practices under the Dodd-Frank Act.
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The CFPB has rulemaking authority over key federal consumer protection laws applicable to mortgage brokers and lenders, including TILA, RESPA, ECOA, and FCRA. Additionally, NDL must comply with state mortgage broker licensing requirements, as well as regulatory expectations set by lenders, insurers, and government-backed loan programs such as FHA, VA, and USDA.
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Available Information We maintain an investor relations website at the following address: https://investors.nerdwallet.com . The information on our investor relations website is not incorporated by reference in this report.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIf we are unable to successfully manage any of these risks, our existing international operations and any future international expansion could be compromised, which could harm our business, financial condition and results of operations. We are actively engaged in significant investments in new product offerings, technologies, and minority investments, with plans to further increase these investments in the future.
Biggest changeSignificant economic developments in these markets, or the perception that any of them could occur, creates further challenges for operating in these markets. If we are unable to successfully manage any of these risks, our existing international operations and any future international expansion could be compromised, which could harm our business, financial condition and results of operations.
Furthermore, even if we successfully acquire or invest in additional businesses or technologies, we may not achieve the anticipated benefits or synergies due to a number of factors, including, without limitation: • unanticipated costs or liabilities associated with the acquisition, including claims related to the acquired company, its product offerings, or technology; • incurrence of acquisition-related or investment-related expenses, which would be recognized as a current period expense; 29 Table of Contents • inability to generate sufficient revenue to offset acquisition or investment costs; • inability to maintain relationships with customers and partners of the acquired business; • challenges maintaining quality and security standards consistent with our brand; • inability to identify security vulnerabilities in acquired technology; • inability to achieve anticipated synergies or unanticipated difficulty with integration into our corporate culture; • the need to integrate or implement additional controls, procedures, and policies; • challenges caused by distance and cultural differences; • harm to our existing business relationships with business partners as a result of the acquisition or investment; • potential loss of key employees; • use of resources that are needed in other parts of our business and diversion of management and employee resources; • unanticipated complexity in accounting requirements; • use of substantial portions of our available cash or the incurrence of debt to consummate the acquisition; and • disputes that may arise out of earn-outs, escrows, and other arrangements related to an acquisition of a company.
Furthermore, even if we successfully acquire or invest in additional businesses or technologies, we may not achieve the anticipated benefits or synergies due to a number of factors, including, without limitation: • unanticipated costs or liabilities associated with the acquisition, including claims related to the acquired company, its product offerings, or technology; • incurrence of acquisition-related or investment-related expenses, which would be recognized as a current period expense; 30 Table of Contents • inability to generate sufficient revenue to offset acquisition or investment costs; • inability to maintain relationships with customers and partners of the acquired business; • challenges maintaining quality and security standards consistent with our brand; • inability to identify security vulnerabilities in acquired technology; • inability to achieve anticipated synergies or unanticipated difficulty with integration into our corporate culture; • the need to integrate or implement additional controls, procedures, and policies; • challenges caused by distance and cultural differences; • harm to our existing business relationships with business partners as a result of the acquisition or investment; • potential loss of key employees; • use of resources that are needed in other parts of our business and diversion of management and employee resources; • unanticipated complexity in accounting requirements; • use of substantial portions of our available cash or the incurrence of debt to consummate the acquisition; and • disputes that may arise out of earn-outs, escrows, and other arrangements related to an acquisition of a company.
There are many factors that could negatively affect our ability to grow our user base and engagement, including if: • we lose users to new market entrants and/or existing competitors; • we do not obtain regulatory approvals necessary for expansion into new verticals, geographies or to launch new products, product features or tools; 15 Table of Contents • we fail to effectively use search engines, social media platforms, digital app stores, content-based online advertising, and other online sources for generating traffic to our platform; • our platform experiences disruptions or outages; • we suffer reputational harm to our brand including from negative publicity, whether accurate or inaccurate; • we fail to expand geographically; • we fail to offer new and competitive products, to provide effective updates to our existing products or to keep pace with technological improvements in our industry; • technical or other problems frustrate the user experience; • we are unable to address user concerns regarding the content, privacy, and security of our digital platform; • we are unable to continue to innovate and improve our platform by generating compelling content and tools; • existing or new financial services providers use incentives to directly cross-sell their products, reducing consumer benefits of using multiple providers; or • we are unable to successfully launch new verticals.
There are many factors that could negatively affect our ability to grow our user base and engagement, including if: • we lose users to new market entrants and/or existing competitors; • we do not obtain regulatory approvals necessary for expansion into new verticals, geographies or to launch new products, product features or tools; • we fail to effectively use search engines, social media platforms, digital app stores, content-based online advertising, and other online sources for generating traffic to our platform; • our platform experiences disruptions or outages; • we suffer reputational harm to our brand including from negative publicity, whether accurate or inaccurate; • we fail to expand geographically; • we fail to offer new and competitive products, to provide effective updates to our existing products or to keep pace with technological improvements in our industry; • technical or other problems frustrate the user experience; • we are unable to address user concerns regarding the content, privacy, and security of our digital platform; • we are unable to continue to innovate and improve our platform by generating compelling content and tools; • existing or new financial services providers use incentives to directly cross-sell their products, reducing consumer benefits of using multiple providers; or 16 Table of Contents • we are unable to successfully launch new verticals.
While these endeavors hold significant potential, they also come with inherent risks, and there is no guarantee that we will realize the anticipated benefits. • Our financial performance is dependent on our ability to successfully refer users to financial services partners, and these partners are not precluded from offering products and services outside of our platform. • Macroeconomic developments such as inflationary conditions in the U.S. have caused macroeconomic uncertainty and may have an adverse impact on our business, results of operations and our vertical diversification strategy. • Adverse conditions in the consumer finance markets, or poor or uncertain macroeconomic conditions, could harm our business, financial condition and results of operations if our financial services partners reduce their marketing budgets and decrease spending on our platform. • Changes in the loans markets could harm our business, financial condition and results of operations. • Our business is subject to a variety of financial regulations in the U.S., UK, Canada and Australia, many of which are overlapping, ambiguous and still developing, which could subject us to claims or otherwise harm our business. • Security incidents, or real or perceived errors, failures or bugs in our systems and platform could impair our operations, compromise our confidential information or our users’ personal information, damage our reputation and brand, and harm our business and operating results. • The dual class structure of our common stock has the effect of concentrating voting control with our Co-founder, CEO and Chairman of our Board of Directors, Tim Chen, which will limit or preclude your ability to influence corporate matters.
While these endeavors hold significant potential, they also come with inherent risks, and there is no guarantee that we will realize the anticipated benefits. • Our financial performance is dependent on our ability to successfully refer users to financial services partners, and these partners are not precluded from offering products and services outside of our platform. • Macroeconomic developments such as inflationary conditions in the U.S. have caused macroeconomic uncertainty and may have an adverse impact on our business, results of operations and our vertical diversification strategy. • Adverse conditions in the consumer finance markets, or poor or uncertain macroeconomic conditions, could harm our business, financial condition and results of operations if our financial services partners reduce their marketing budgets and decrease spending on our platform. • Changes in the loans markets could harm our business, financial condition and results of operations. • Our business is subject to a variety of financial regulations in the U.S., UK, Canada and Australia, many of which are overlapping, ambiguous and still developing, which could subject us to claims or otherwise harm our business. 15 Table of Contents • Security incidents, or real or perceived errors, failures or bugs in our systems and platform could impair our operations, compromise our confidential information or our users’ personal information, damage our reputation and brand, and harm our business and operating results. • The dual class structure of our common stock has the effect of concentrating voting control with our Co-founder, CEO and Chairman of our Board of Directors, Tim Chen, which will limit or preclude your ability to influence corporate matters.
If search engines’ algorithms, methodologies, and/or policies are modified or enforced in ways we do not anticipate, or if our search results page rankings decline for other reasons, traffic to our platform or user growth or engagement could decline, any of which would harm our business, financial condition and results of operations. • Failure to maintain our reputation and brand recognition and attract and engage users in a cost-effective manner would harm our business, financial condition and results of operations. • Use of social media, influencers, affiliate marketing, email and text messages may adversely impact our brand and reputation or subject us to fines or other penalties. • We may make decisions based on the best interests of our users in order to build long-term trust that may result in us forgoing short-term gains. • We rely on third parties to perform certain key functions, and their failure to perform those functions could adversely affect our business, financial condition and results of operations. • We compete in a highly competitive and rapidly evolving market with a number of other companies and we face the possibility of new entrants disrupting our market over time. • Our recent international expansion subjects us to additional costs and risks which could harm our business, revenue and financial results, and our continued international expansion may be unsuccessful. 14 Table of Contents • We are actively investing in new product offerings, technologies, and minority investments, with plans to further increase these investments in the future.
If search engines’ algorithms, methodologies, and/or policies are modified or enforced in ways we do not anticipate, or if our search results page rankings decline for other reasons, traffic to our platform or user growth or engagement could decline, any of which would harm our business, financial condition and results of operations. • Failure to maintain our reputation and brand recognition and attract and engage users in a cost-effective manner would harm our business, financial condition and results of operations. • Use of social media, influencers, affiliate marketing, email and text messages may adversely impact our brand and reputation or subject us to fines or other penalties. • We may make decisions based on the best interests of our users in order to build long-term trust that may result in us forgoing short-term gains. • We rely on third parties to perform certain key functions, and their failure to perform those functions could adversely affect our business, financial condition and results of operations. • We compete in a highly competitive and rapidly evolving market with a number of other companies and we face the possibility of new entrants disrupting our market over time. • Our international expansion subjects us to additional costs and risks which could harm our business, revenue and financial results, and our continued international expansion may be unsuccessful. • We are actively investing in new product offerings, technologies, and minority investments, with plans to further increase these investments in the future.
Our results of operations may suffer if we fail to successfully anticipate and manage these issues associated with expansion into new verticals. 20 Table of Contents We rely on the data provided to us by users and third parties to operate and improve our product offerings, and if we are unable to maintain and grow the use of such data, we may be unable to provide users with a platform experience that is relevant and effective, which would harm our business, financial condition and results of operations.
Our results of operations may suffer if we fail to successfully anticipate and manage these issues associated with expansion into new verticals. 21 Table of Contents We rely on the data provided to us by users and third parties to operate and improve our product offerings, and if we are unable to maintain and grow the use of such data, we may be unable to provide users with a platform experience that is relevant and effective, which would harm our business, financial condition and results of operations.
Despite our compliance efforts and activities we cannot assure compliance by our employees or representatives for which we may be held responsible, and any such violation could materially adversely affect our reputation, business, financial condition and results of operations. 24 Table of Contents Risks Related to Our Human Capital We depend on our executive team and other key employees to manage the business and the loss of one or more of these employees or an inability to attract and retain highly skilled employees could materially harm our business.
Despite our compliance efforts and activities we cannot assure compliance by our employees or representatives for which we may be held responsible, and any such violation could materially adversely affect our reputation, business, financial condition and results of operations. 25 Table of Contents Risks Related to Our Human Capital We depend on our executive team and other key employees to manage the business and the loss of one or more of these employees or an inability to attract and retain highly skilled employees could materially harm our business.
This may require significant additional costs associated with resolving such action in other jurisdictions and there can be no assurance that the provisions will be enforced by a court in those other jurisdictions. 38 Table of Contents These exclusive forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage lawsuits against us and our directors, officers and other employees.
This may require significant additional costs associated with resolving such action in other jurisdictions and there can be no assurance that the provisions will be enforced by a court in those other jurisdictions. 39 Table of Contents These exclusive forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers, or other employees, which may discourage lawsuits against us and our directors, officers and other employees.
The terms of our credit agreement with JPM and certain other lenders restrict our ability to pay dividends, and we may enter into additional agreements in the future that could also contain restrictions on payments of cash dividends. 34 Table of Contents We are an emerging growth company, and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies may make our Class A common stock less attractive to investors.
The terms of our credit agreement with JPM and certain other lenders restrict our ability to pay dividends, and we may enter into additional agreements in the future that could also contain restrictions on payments of cash dividends. 35 Table of Contents We are an emerging growth company, and we cannot be certain if the reduced reporting requirements applicable to emerging growth companies may make our Class A common stock less attractive to investors.
Any costs incurred to prevent or mitigate this potential liability could also harm our business, financial condition and operating results. 22 Table of Contents Failure to obtain proper business licenses or other documentation, or to otherwise comply with local laws and requirements regarding marketing or matching consumers with financial services providers, may result in civil or criminal penalties and restrictions on our ability to conduct business in that jurisdiction.
Any costs incurred to prevent or mitigate this potential liability could also harm our business, financial condition and operating results. 23 Table of Contents Failure to obtain proper business licenses or other documentation, or to otherwise comply with local laws and requirements regarding marketing or matching consumers with financial services providers, may result in civil or criminal penalties and restrictions on our ability to conduct business in that jurisdiction.
If a significant number of users seek financial products and services directly from our financial services partners or from our online competitors, as opposed to through our platform, our business, financial condition and results of operations could be adversely affected. 19 Table of Contents If we are unable to maintain the quality of our products, expand our product offerings or continue technological innovation and improvements, our prospects for future growth may be harmed.
If a significant number of users seek financial products and services directly from our financial services partners or from our online competitors, as opposed to through our platform, our business, financial condition and results of operations could be adversely affected. 20 Table of Contents If we are unable to maintain the quality of our products, expand our product offerings or continue technological innovation and improvements, our prospects for future growth may be harmed.
We cannot predict or estimate the amount or timing of additional costs we may incur to respond to these requirements. 35 Table of Contents If we fail to maintain proper and effective internal control over financial reporting, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our Class A common stock may decline.
We cannot predict or estimate the amount or timing of additional costs we may incur to respond to these requirements. 36 Table of Contents If we fail to maintain proper and effective internal control over financial reporting, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of our Class A common stock may decline.
Further, an unexpected or prolonged economic downturn, or rapidly rising or sustained high unemployment, would adversely affect our financial condition and results of operations. 21 Table of Contents Adverse conditions in the consumer finance markets, or poor or uncertain macroeconomic conditions, could harm our business, financial condition and results of operations if our financial services partners reduce their marketing budgets and decrease spending on our platform.
Further, an unexpected or prolonged economic downturn, or rapidly rising or sustained high unemployment, would adversely affect our financial condition and results of operations. 22 Table of Contents Adverse conditions in the consumer finance markets, or poor or uncertain macroeconomic conditions, could harm our business, financial condition and results of operations if our financial services partners reduce their marketing budgets and decrease spending on our platform.
As a result, our culture, information technology requirements, cybersecurity risk, and business operations could be adversely affected. 25 Table of Contents Risks Related to Our Technology, Security and Intellectual Property Security incidents, or real or perceived errors, failures or bugs in our systems and platform could impair our operations, compromise our confidential information or our users’ personal information, damage our reputation and brand, and harm our business and operating results.
As a result, our culture, information technology requirements, cybersecurity risk, and business operations could be adversely affected. 26 Table of Contents Risks Related to Our Technology, Security and Intellectual Property Security incidents, or real or perceived errors, failures or bugs in our systems and platform could impair our operations, compromise our confidential information or our users’ personal information, damage our reputation and brand, and harm our business and operating results.
Furthermore, any 26 Table of Contents contractual protections such as a counterparty’s obligation to indemnify us may not be sufficient to protect us if our counterparty doesn’t have adequate resources or if we are unable to enforce such protections. Claims by others that we infringed their proprietary technology or other intellectual property rights could harm our business.
Furthermore, any 27 Table of Contents contractual protections such as a counterparty’s obligation to indemnify us may not be sufficient to protect us if our counterparty doesn’t have adequate resources or if we are unable to enforce such protections. Claims by others that we infringed their proprietary technology or other intellectual property rights could harm our business.
We expect to continue to make investments in the development and expansion of our business, which may not result in increased or sufficient revenue or growth, as a result of which we may not be able to achieve or maintain sustained profitability. 30 Table of Contents We have made significant estimates and judgments in calculating our income tax provision and other tax assets and liabilities.
We expect to continue to make investments in the development and expansion of our business, which may not result in increased or sufficient revenue or growth, as a result of which we may not be able to achieve or maintain sustained profitability. 31 Table of Contents We have made significant estimates and judgments in calculating our income tax provision and other tax assets and liabilities.
Chen may make long-term strategic investment decisions and take risks that may not be successful and may seriously harm our business. 31 Table of Contents As our Chief Executive Officer, Mr. Chen also has control over our day-to-day management and the implementation of major strategic investments of our company, subject to authorization and oversight by our Board of Directors.
Chen may make long-term strategic investment decisions and take risks that may not be successful and may seriously harm our business. 32 Table of Contents As our Chief Executive Officer, Mr. Chen also has control over our day-to-day management and the implementation of major strategic investments of our company, subject to authorization and oversight by our Board of Directors.
Accordingly, the remedies and damages available to us for unauthorized use of our software may be limited. 27 Table of Contents We may not be able to continue to obtain licenses to third-party software and intellectual property on reasonable terms or at all, which may disrupt our business and harm our financial results.
Accordingly, the remedies and damages available to us for unauthorized use of our software may be limited. 28 Table of Contents We may not be able to continue to obtain licenses to third-party software and intellectual property on reasonable terms or at all, which may disrupt our business and harm our financial results.
Tim Chen, our Co-founder, Chief Executive Officer and Chairman of our Board of Directors and his affiliated trusts hold all outstanding shares of Class B common stock, which as of December 31, 2023 constituted approximately 87.5% of the voting power of our outstanding capital stock.
Tim Chen, our Co-founder, Chief Executive Officer and Chairman of our Board of Directors and his affiliated trusts hold all outstanding shares of Class B common stock, which as of December 31, 2024 constituted approximately 87.5% of the voting power of our outstanding capital stock.
Any adverse determination in litigation could also subject us to significant liabilities. 33 Table of Contents Our results of operations may fluctuate on a quarterly and annual basis, which may impact our stock price and make it difficult to predict our future performance.
Any adverse determination in litigation could also subject us to significant liabilities. 34 Table of Contents Our results of operations may fluctuate on a quarterly and annual basis, which may impact our stock price and make it difficult to predict our future performance.
Based on our ongoing assessment of all available evidence, both positive and negative, including consideration of our historical profitability and the estimated impact of our operating model on future profitability, we concluded that it was more likely than not that our U.S. deferred tax assets in excess of deferred tax liabilities would not be realized, and we recorded a valuation allowance against these net U.S. deferred tax assets as of December 31, 2023.
Based on our ongoing assessment of all available evidence, both positive and negative, including consideration of our historical profitability and the estimated impact of our operating model on future profitability, we concluded that it was more likely than not that our U.S. deferred tax assets in excess of deferred tax liabilities would be realized, and we recorded a release of the valuation allowance against these net U.S. deferred tax assets as of December 31, 2024.
We cannot be sure that all of our use of open source software is in a manner that is consistent with our current policies and 28 Table of Contents procedures, or will not subject us to liability.
We cannot be sure that all of our use of open source software is in a manner that is consistent with our current policies and 29 Table of Contents procedures, or will not subject us to liability.
Although alternative providers could host our platform on a substantially similar basis, such transition could potentially be disruptive and we could incur significant costs in connection therewith. We compete in a highly competitive and rapidly evolving market with a number of other companies and we face the possibility of new entrants disrupting our market over time.
Although alternative providers could host our platform on a substantially similar basis, such transition could potentially be disruptive and we could incur significant costs in connection therewith. 18 Table of Contents We compete in a highly competitive and rapidly evolving market with a number of other companies and we face the possibility of new entrants disrupting our market over time.
For example, in the U.S., we are subject to the Gramm–Leach–Bliley Act (GLBA) which governs non-public personal information of individuals who obtain financial products or services from financial institutions primarily for personal, family or household purposes, as well as the Fair Credit Reporting Act (FCRA) which generally governs the collection of credit information and access to credit reports.
For example, in the U.S., we are subject to the GLBA which governs non-public personal information of individuals who obtain financial products or services from financial institutions primarily for personal, family or household purposes, as well as the Fair Credit Reporting Act (FCRA) which generally governs the collection of credit information and access to credit reports.
Brand recognition is a key differentiating factor between us and our competitors. We believe that continuing to build and maintain the recognition of our brand is important to achieving increased demand for the products we provide.
Brand recognition is a key differentiating factor between us and our competitors. We believe that continuing to build and maintain the recognition of our brand is important to achieving increased traffic for our platform and demand for the products we provide.
Continued inflationary conditions, higher interest rates, and a tightening of credit markets would pose challenges to our business and may impact many of our verticals and may not be offset by performance in other verticals.
Continued inflationary conditions, high interest rates, and a tightening of credit markets would pose challenges to our business and may impact many of our verticals and may not be offset by performance in other verticals.
As a result, the market price of our Class A common stock could be adversely affected. 32 Table of Contents The price of our stock may be volatile, and you could lose all or part of your investment. The trading price of our Class A common stock could be volatile, and you could lose all or part of your investment.
As a result, the market price of our Class A common stock could be adversely affected. 33 Table of Contents The price of our stock may be volatile, and you could lose all or part of your investment. The trading price of our Class A common stock could be volatile, and you could lose all or part of your investment.
Risks Related to Our Industry and the Consumer Finance Economy Macroeconomic developments such as inflationary conditions and a rising interest rate environment in the U.S. have caused macroeconomic uncertainty and may have an adverse impact on our business, results of operations and our vertical diversification strategy.
Risks Related to Our Industry and the Consumer Finance Economy Macroeconomic developments such as inflationary conditions and the current interest rate environment in the U.S. have caused macroeconomic uncertainty and may have an adverse impact on our business, results of operations and our vertical diversification strategy.
Our brand promotion activities may not generate consumer awareness or yield increased revenue, and even if they do, any increased revenue may not offset the expenses we incur in building our brand. 16 Table of Contents The strength of our brand may be harmed by adverse publicity from many sources.
Our brand promotion activities may not generate consumer awareness or yield increased revenue, and even if they do, any increased revenue may not offset the expenses we incur in building our brand. The strength of our brand may be harmed by adverse publicity from many sources.
Risks Related to Our Business We depend on relationships with our financial services partners, and any adverse changes in their financial strength, tightening of their underwriting standards or adverse changes to their online marketing strategy would adversely affect our business, financial condition and results of operations.
Risks Related to Our Business We depend on relationships with our financial services partners for our historical businesses, and any adverse changes in their financial strength, tightening of their underwriting standards or adverse changes to their online marketing strategy would adversely affect our business, financial condition and results of operations.
Furthermore, in the event that any of our agreements with our third-party service providers are terminated, we may experience significant costs or downtime in connection with the transfer to, or 17 Table of Contents the addition of, new hosting providers.
Furthermore, in the event that any of our agreements with our third-party service providers are terminated, we may experience significant costs or downtime in connection with the transfer to, or the addition of, new hosting providers.
In order to attract consumers to our platform, convert these consumers into matches with financial services partners and generate repeat visits, we must market our platform and maintain consumer trust.
In order to attract consumers to the products we provide and our platform, convert these consumers into matches with financial services partners and generate repeat visits, we must market our platform and maintain consumer trust.
Certain of our products that are not otherwise subject to the GLBA or FCRA may be subject to additional laws and regulations. For example, the California Consumer Privacy Act (CCPA) created new data privacy rights for California-resident users that were expanded when the California Privacy Rights Act (CPRA) went into effect 23 Table of Contents in 2023.
Certain of our products that are not otherwise subject to the GLBA or FCRA may be subject to additional laws and regulations. For example, the CCPA created new data privacy rights for California-resident users that were expanded when the California Privacy Rights Act went into effect in 2023.
Since then, the UK has undergone efforts to introduce post-Brexit data protection reform in the form of the Data Protection and Digital Information (No. 2) Bill (the “Bill”) which is intended to supersede the UK’s version of the GDPR.
Since then, the UK underwent efforts to introduce post-Brexit data protection reform in the form of the Data Protection and Digital Information (No. 2) Bill which is intended to supersede the UK’s version of the GDPR.
Our existing international operations and further international expansion are subject to a number of difficulties and risks, including: • challenges inherent to efficiently recruiting and retaining talented and capable employees in foreign countries and maintaining our company culture and employee programs across all of our offices, including those resulting from cultural differences and geographic dispersion; • required compliance with existing and changing foreign regulatory requirements and laws that are or may be applicable to our business in the future, such as the European Union’s General Data Protection Regulation (GDPR) and other data privacy requirements; labor and employment regulations; anti-competition regulations; regulatory laws and requirements for licenses and authorizations; and the UK Bribery Act of 2010 and other anti-corruption laws; • required compliance with U.S. laws such as the Foreign Corrupt Practices Act, and other U.S. federal laws and regulations established by the office of Foreign Asset Control and other governmental entities; • difficulties identifying, obtaining, and maintaining the government approvals, authorizations, or licensures required to conduct our business in foreign markets; • financial risks, such as longer payment cycles, difficulty collecting accounts receivable, and the impact of local and regional financial crises on demand and payment for our products; • difficulties obtaining intellectual property protection, enforcing our intellectual property rights, and defending against third-party intellectual property infringement claims; • challenges successfully addressing novel sources of competition, including in the context of foreign laws and business practices that may favor local companies; • difficulties managing fluctuations in currency exchange rates and foreign exchange controls; and • potentially adverse tax consequences, including multiple and possibly overlapping tax regimes, the complexities of foreign value-added tax systems, and changes in tax rates. 18 Table of Contents As we continue to expand our international operations, our success will depend in large part on our ability to anticipate and effectively manage these risks, which in turn will require significant management attention and financial resources.
Our existing international operations and further international expansion are subject to a number of difficulties and risks, including: • challenges inherent to efficiently recruiting and retaining talented and capable employees in foreign countries and maintaining our company culture and employee programs across all of our offices, including those resulting from cultural differences and geographic dispersion; • required compliance with existing and changing foreign regulatory requirements and laws that are or may be applicable to our business in the future, such as the European Union’s General Data Protection Regulation (GDPR) and other data privacy requirements; labor and employment regulations; anti-competition regulations; regulatory laws and requirements for licenses and authorizations; and the UK Bribery Act of 2010 and other anti-corruption laws; • required compliance with U.S. laws such as the Foreign Corrupt Practices Act, and other U.S. federal laws and regulations established by the office of Foreign Asset Control and other governmental entities; 19 Table of Contents • difficulties identifying, obtaining, and maintaining the government approvals, authorizations, or licensures required to conduct our business in foreign markets; • financial risks, such as longer payment cycles, difficulty collecting accounts receivable, and the impact of local and regional financial crises on demand and payment for our products; • difficulties obtaining intellectual property protection, enforcing our intellectual property rights, and defending against third-party intellectual property infringement claims; • challenges successfully addressing novel sources of competition, including in the context of foreign laws and business practices that may favor local companies; • difficulties managing fluctuations in currency exchange rates and foreign exchange controls; and • potentially adverse tax consequences, including multiple and possibly overlapping tax regimes, the complexities of foreign value-added tax systems, and changes in tax rates.
In addition, a growing number of states have passed or are expected to pass their own respective privacy laws.
In addition, a growing number of states have passed 24 Table of Contents or are expected to pass their own respective privacy laws.
We may be forced to expend significant resources to remain competitive with current and potential competitors. If any of our competitors are more successful than we are at attracting and engaging users or financial services partners, our business, financial condition and results of operations could be materially and adversely affected.
We may be forced to expend significant resources to remain competitive with current and potential competitors. If any of our competitors are more successful than we are at attracting and engaging users or financial services partners, our business, financial condition and results of operations could be materially and adversely affected. Our expansion into mortgage brokering presents additional risks.
We track certain operational metrics, including metrics such as Monthly Unique Users (MUUs), which may differ from estimates or similar metrics published by third parties due to differences in sources, methodologies, or the assumptions on which we rely.
We track certain operational metrics, which may differ from estimates or similar metrics published by third parties due to differences in sources, methodologies, or the assumptions on which we rely.
Further interest rate increases and continued conservatism by our financial services partners would negatively impact our loans and SMB product verticals by both reducing demand for loan products and reducing the supply of credit available, making it more difficult for us to match consumers and small and mid-sized businesses with financial services products.
Federal Reserve decreased the benchmark federal funds rate in 2024, we expect that future interest rate increases and continued conservatism by our financial services partners would negatively impact our loans and SMB product verticals by both reducing demand for loan products and reducing the supply of credit available, making it more difficult for us to match consumers and small and mid-sized businesses with financial services products.
There are numerous federal, state and local laws and regulations regarding data privacy and the storing, sharing, use, processing, disclosure and protection of personal information and other user data, the scope of which are changing and subject to differing interpretations. In addition, as we continue to expand internationally, we are subject to foreign data privacy and security laws and regulations.
There are numerous federal, state and local laws and regulations regarding data privacy and the collection, storing, sharing, use, processing, disclosure and protection of personal information and other user data, the scope of which are changing and subject to differing interpretations.
These data privacy laws and regulations are complex, continue to evolve, and on occasion may be inconsistent between jurisdictions leading to uncertainty in interpreting such laws.
In addition, as we continue to expand internationally, we are subject to foreign data privacy and security laws and regulations. These data privacy laws and regulations are complex, continue to evolve, and on occasion may be inconsistent between jurisdictions leading to uncertainty in interpreting such laws.
If securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price and trading volume could decline. The trading market for our Class A common stock depends in part on the research and reports that securities or industry analysts publish about us or our business.
The trading market for our Class A common stock depends in part on the research and reports that securities or industry analysts publish about us or our business.
Delaware law provides that directors of a corporation will not be personally liable for monetary damages for any breach of fiduciary duties as directors, except liability for: • any breach of the director’s duty of loyalty to the corporation or its stockholders; • any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; • unlawful payments of dividends or unlawful stock repurchases or redemptions; or • any transaction from which the director derived an improper personal benefit.
Delaware law provides that directors of a corporation will not be personally liable for monetary damages for any breach of fiduciary duties as directors, except liability for: • any breach of the director’s duty of loyalty to the corporation or its stockholders; • any act or omission not in good faith or that involves intentional misconduct or a knowing violation of law; • unlawful payments of dividends or unlawful stock repurchases or redemptions; or • any transaction from which the director derived an improper personal benefit. 38 Table of Contents Such limitation of liability does not apply to liabilities arising under federal securities laws and does not affect the availability of equitable remedies such as injunctive relief or rescission.
While these numbers are based on what we believe to be reasonable estimates of our metrics for the applicable period of measurement, there are inherent challenges in measuring how our platform is used. For example, the number of MUUs on our platform is based on activity associated with a unique device identifier during a certain time period.
While these numbers are based on what we believe to be reasonable estimates of our metrics for the applicable period of measurement, there are inherent challenges in measuring how our platform is used.
Aspects of our business are subject to a variety of federal, state and provincial financial and other laws in the U.S., Canada, Australia and UK, including laws, authorizations, and state or provincial licensing requirements relating to matching consumers with financial services providers; the marketing of mortgages, credit cards, personal loans, insurance, and other financial products and services; privacy and data security; investment advisory services; and other laws that are frequently evolving and developing.
Aspects of our business are subject to a variety of federal, state and provincial financial and other laws in the U.S., Canada, Australia and UK, including laws, authorizations, and state or provincial licensing requirements relating to matching consumers with financial services providers; the marketing of mortgages, credit cards, personal loans, insurance, and other financial products and services; the manner in which we conduct our loan origination and servicing businesses and the fees that we may charge; the collection, use, retention, protection, disclosure, transfer and other processing of consumer personal information; investment advisory services; and other laws that are frequently evolving and developing.
We may not be able to retain the services of any of our senior management or other key personnel, as their employment is at-will and they could leave at any time.
We depend on our senior management, including Tim Chen, our Co-founder, Chief Executive Officer and Chairman of our Board of Directors, as well as other key personnel. We may not be able to retain the services of any of our senior management or other key personnel, as their employment is at-will and they could leave at any time.
In addition, as our business grows into new markets or expands and we collect, use and share more user data internally and with financial services partners, we may become subject to additional laws and regulations.
In addition, as our business grows into new markets or expands and we collect, use and share more user data internally and with financial services partners, we may become subject to additional laws and regulations. We also anticipate that U.S. federal regulators relevant to our business, such as the FTC and the CFPB, may pursue more enforcement actions.
Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets.
Failure to remedy any material weakness in our internal control over financial reporting, or to implement or maintain other effective control systems required of public companies, could also restrict our future access to the capital markets. In addition, if we are no longer an emerging growth company, we will incur additional legal, accounting, and other expenses.
Certain individuals may have more than one device and therefore may be counted more than once in our count of MUUs. Limitations or errors with respect to how we measure data or with respect to the data that we measure may affect our understanding of certain details of our business, which could affect our long-term strategies.
Limitations or errors with respect to how we measure data or with respect to the data that we measure may affect our understanding of certain details of our business, which could affect our long-term strategies.
The occurrence of one or more of these events, alone or in combination, with a significant number of financial services partners could harm our business, financial condition and results of operations.
Our partners could also change their online marketing strategies or implement cost-reduction initiatives that decrease spending through our platform. The occurrence of one or more of these events, alone or in combination, with a significant number of financial services partners could harm our business, financial condition and results of operations.
Our ability to earn revenue is dependent on referring users of our site to our financial services partners and our users seeking to transact with such partners.
Our financial performance is dependent on our ability to successfully refer users to financial services partners, and these partners are not precluded from offering products and services outside of our platform. Our ability to earn revenue is dependent on referring users of our site to our financial services partners and our users seeking to transact with such partners.
Our success depends on the financial strength and underwriting standards of credit card issuers, lenders, insurers and other participants on our platform. If our financial services partners experience financial difficulties, they may cease participating on our platform or tighten underwriting standards, which would result in fewer opportunities for us to earn fees from matching consumers with them.
If our financial services partners experience financial difficulties, they may cease participating on our platform or tighten underwriting standards, which would result in fewer opportunities for us to earn fees from matching consumers with them. In times of financial difficulty, financial services providers may also fail to pay fees when due or drop the quality of their services to consumers.
The failure of our business to maintain or enhance its reputation and brand recognition and attract and retain consumers in a cost-effective manner could materially and adversely affect our business, financial condition and results of operations.
The failure of our business to maintain or enhance its reputation and brand recognition and attract and retain consumers in a cost-effective manner could materially and adversely affect our business, financial condition and results of operations. 17 Table of Contents Use of social media, influencers, affiliate marketing, email, and text messages may adversely impact our brand and reputation or subject us to fines or other penalties.
We will incur significant increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives.
We will incur increased costs if we are no longer an emerging growth company, and our management will be required to devote substantial time to new compliance initiatives.
If one or more of these analysts ceases coverage of our company or fails to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume to decline. 36 Table of Contents Provisions in our corporate charter documents and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.
Provisions in our corporate charter documents and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.
Unless our board of directors elects not to increase the number of shares available for future grant each year, our stockholders may experience additional dilution. As a consequence, these shares can be freely sold in the public market upon issuance, subject to volume limitations applicable to affiliates.
Unless our board of directors elects not to increase the number of shares available for future grant each year, our stockholders may experience additional dilution.
Our recent international expansion subjects us to additional costs and risks which could harm our business, revenue and financial results, and our continued international expansion may be unsuccessful. Historically, all of our business has been generated in the U.S. and we have little experience operating internationally. In 2020, we entered the UK market with our acquisition of Notice Media Ltd.
Historically, all of our business has been generated in the U.S. and we have little experience operating internationally. In 2020, we entered the UK market with our acquisition of Notice Media Ltd. (doing business as Know Your Money), an online provider of financial guidance and tools based in the UK.
Such limitation of liability does not apply to liabilities arising under federal securities laws and does not affect the availability of equitable remedies such as injunctive relief or rescission. 37 Table of Contents Our amended and restated bylaws provide that we are required to indemnify our directors and officers to the fullest extent permitted by Delaware law and may indemnify our other employees and agents.
Our amended and restated bylaws provide that we are required to indemnify our directors and officers to the fullest extent permitted by Delaware law and may indemnify our other employees and agents.
Instead, we view this product as a means to build consumer trust by offering a compelling product designed for those who want to build or improve their credit. We expect that as these consumers qualify for non-secured credit cards, they will transact on our site, allowing us to earn fees from matching them with financial services partners.
Instead, we view this product as a means to build consumer trust by offering a compelling product designed for those who want to build or improve their credit.
Use of social media, influencers, affiliate marketing, email, and text messages may adversely impact our brand and reputation or subject us to fines or other penalties. We use social media, including Facebook, Instagram and TikTok, as well as affiliate marketing, email, and SMS as part of our multi-channel approach to marketing.
We use social media, including Facebook, Instagram and TikTok, as well as affiliate marketing, email, and SMS as part of our multi-channel approach to marketing. Laws and regulations governing the use of these platforms and other digital marketing channels are rapidly evolving.
We continue to adapt to and develop strategies to address international markets, but there is no guarantee that such efforts will be successful.
We entered the Canadian and Australian markets organically in the third quarter of 2021 and the fourth quarter of 2022, respectively. We believe part of our growth strategy depends on our continued international expansion. We continue to adapt to and develop strategies to address international markets, but there is no guarantee that such efforts will be successful.
Removed
In times of financial difficulty, financial services providers may also fail to pay fees when due or drop the quality of their services to consumers. Our partners could also change their online marketing strategies or implement cost-reduction initiatives that decrease spending through our platform.
Added
A significant portion of our success depends on the financial strength and underwriting standards of credit card issuers, lenders, insurers and other participants on our platform.
Removed
Laws and regulations governing the use of these platforms and other digital marketing channels are rapidly evolving.
Added
In 2024, the launch of NerdWallet+, a membership experience focused on providing additional services and rewards to consumers who join for an annual fee, is a program to build consumer trust designed to reward consumers for making healthy financial decisions, but it is not anticipated to generate significant profits.
Removed
(doing business as Know Your Money), an online provider of financial guidance and tools based in the UK. We entered the Canadian and Australian markets organically in the third quarter of 2021 and the fourth quarter of 2022, respectively. We believe part of our growth strategy depends on our continued international expansion.
Added
Our recent acquisition of NDL in October 2024 and our expansion into mortgage brokerage services introduce additional risks. We must comply with complex federal and state regulations governing mortgage brokerage operations, including licensing requirements for both the entity and individuals in the states where NDL operates.
Removed
In addition, certain international markets where we do business are subject to significant economic uncertainty. Significant economic developments in these markets, or the perception that any of them could occur, creates further challenges for operating in these markets.
Added
Maintaining and expanding relationships with wholesale lenders and credit facility providers is critical to NDL’s ability to offer competitive loan products. Successfully integrating NDL’s operations, technology, and personnel into NerdWallet’s broader platform while ensuring compliance with laws such as the GLBA and RESPA presents execution challenges.
Removed
However, these endeavors inherently carry risks, and the realization of expected benefits is not guaranteed. Our substantial investments encompass the development of various products, technologies, and minority investments, including our mobile application, personal finance management tools, data infrastructure, and recommendation engine.
Added
Our limited experience operating a mortgage brokerage business increases the importance of attracting and retaining licensed mortgage professionals while ensuring adherence to SAFE Act licensing requirements and evolving industry regulations. The CFPB and federal agencies such as the FHA and the VA continue to expand enforcement actions in mortgage origination, requiring robust compliance and risk management practices.
Removed
We are committed to continuing substantial resource allocation for the creation of new technologies, tools, features, services, and product offerings. Anticipating an increase in investments in the near term, we acknowledge that this may impact our margins.
Added
Additionally, operating a direct mortgage brokerage alongside our existing mortgage marketplace comparison platform creates potential conflicts of interest that must be carefully managed to maintain transparency and trust with consumers and lending partners.
Removed
Following the acquisition of On the Barrelhead (OTB) in the third quarter of 2022, we plan to continue investing in developing and expanding new offerings using the acquired technology. Moreover, we plan to allocate substantial resources to grow the verticals on our platform, increase our scale, and expand into additional geographic markets.
Added
Mortgage brokerage operations are highly sensitive to interest rate fluctuations, housing market conditions, and changes in wholesale lender policies, all of which could impact loan approvals, funding availability, and revenue generation. Given the competitive and highly regulated nature of the industry, our success will depend on effective execution, compliance, and maintaining consumer trust while navigating evolving market conditions.
Removed
However, the efficient and effective allocation of our development budget on commercially successful and innovative technologies is crucial for realizing the expected benefits of our strategy. The high degree of risk associated with our new initiatives includes limited or no prior development or operating experience in the strategies, technologies, and regulatory requirements involved.
Added
If we fail to effectively manage these risks, integrate NDL’s operations, or comply with applicable regulatory requirements, our business, financial condition, and results of operations could be materially and adversely affected. Our international expansion subjects us to additional costs and risks which could harm our business, revenue and financial results, and our continued international expansion may be unsuccessful.
Removed
There is no assurance of sustained consumer demand or sufficient market acceptance to generate revenue that offsets new expenses or liabilities associated with these investments. Competitive dynamics pose a risk, as product offerings developed by others may render our offerings noncompetitive or obsolete.
Added
As we continue to expand our international operations, our success will depend in large part on our ability to anticipate and effectively manage these risks, which in turn will require significant management attention and financial resources. In addition, certain international markets where we do business are subject to significant economic uncertainty.
Removed
Furthermore, the development efforts for new product offerings and technologies could distract management attention from current operations and redirect capital and resources from our established products. Even if successful, regulatory authorities may impose new rules or restrictions in response to our innovations, potentially increasing expenses or hindering successful commercialization.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeManagement’s Vigilance A Security Council, led by the CISO with representatives from our engineering, corporate IT, security, legal, and internal audit teams, diligently reviews and assesses cybersecurity plans, risks, and incidents on a monthly basis. Any substantial risk incident is escalated to the executive team, disclosure committee, and potentially the full Board, if deemed material.
Biggest changeManagement’s Vigilance A Security Council, led by the CISO with representatives from our engineering, corporate IT, security, legal, human resources, and internal audit teams, diligently reviews and assesses cybersecurity plans, risks, and incidents on a monthly basis. Any substantial risk incident is escalated to the executive team, disclosure committee, and potentially the full Board, if deemed material.
Regular communication between the CISO and the Chief Legal Officer, Chief Financial Officer, and Chief Executive Officer ensures top management is well-informed about NerdWallet's cybersecurity posture and potential risks. 39 Table of Contents Risk Management Leadership The primary responsibility for assessing, monitoring, and managing our cybersecurity risks lies with our highly experienced CISO.
Regular communication between the CISO and the Chief Legal Officer, Chief Financial Officer, and Chief Executive Officer ensures top management is well-informed about NerdWallet's cybersecurity posture and potential risks. 40 Table of Contents Risk Management Leadership The primary responsibility for assessing, monitoring, and managing our cybersecurity risks lies with our highly experienced CISO.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeItem 2. Properties. Facilities We maintain offices in San Francisco, California, New York, New York, Scottsdale, Arizona, Durango, Colorado and Norwich, UK. We lease all of our facilities and do not own any real property. We have a remote-first policy that allows for almost all roles to be remote on an ongoing basis.
Biggest changeItem 2. Properties. Facilities We maintain offices in San Francisco, California, New York, New York, Scottsdale, Arizona, Bingham Farms, Michigan, and Norwich, UK. We lease all of our facilities and do not own any real property. We have a remote-first policy that allows for almost all roles to be remote on an ongoing basis.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeSee further discussion under “Litigation and Other Legal Matters” in Note 8–Commitments and Contingencies in the notes to consolidated financial statements in Item 8 of Part II of this Annual Report on Form 10-K. Item 4. Mine Safety Disclosures. Not applicable. 40 Table of Contents Part II
Biggest changeSee further discussion under “Litigation and Other Legal Matters” in Note 8–Commitments and Contingencies in the notes to consolidated financial statements in Item 8 of Part II of this Annual Report on Form 10-K. Item 4. Mine Safety Disclosures. Not applicable. 41 Table of Contents Part II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 40 Part II 41 Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 41 Item 6. [Reserved] 42 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 43 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 59 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 41 Part II 42 Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 42 Item 6. [Reserved] 43 Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 44 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 59 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIssuer Purchases of Equity Securities The following table summarizes our share repurchase activity for the three months ended December 31, 2023: Period Total Number of Shares Purchased 1 (in thousands) Average Price Paid per Share 2 Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs 1 (in thousands) Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs 1 (in millions) October 918 $ 8.70 918 $ 30.0 November — $ — — $ 30.0 December — $ — — $ 30.0 Total 918 918 ______________ (1) On May 2, 2023, we announced that our Board of Directors authorized a plan (the Repurchase Plan) under which we may repurchase up to $20 million of our Class A common stock.
Biggest changeIssuer Purchases of Equity Securities The following table summarizes our share repurchase activity for the three months ended December 31, 2024: Period Total Number of Shares Purchased 1 (in thousands) Average Price Paid per Share 2 Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs 1 (in thousands) Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs 1 (in millions) October 645 $ 12.67 645 $ 25.0 November — $ — — $ 25.0 December — $ — — $ 25.0 Total 645 645 ______________ (1) On May 2, 2023, we announced that our Board of Directors authorized a plan under which we may repurchase up to $20 million of our Class A common stock and, following our utilization of that share repurchase authorization, we announced on October 26, 2023, September 9, 2024 and October 29, 2024 that our Board of Directors approved additional share repurchase authorizations under which we may repurchase up to an additional $30 million, $50 million and $25 million, respectively, of our Class A common stock (collectively, the Repurchase Program).
The terms of our credit agreement with JPM and certain other lenders restrict our ability to pay dividends, and we may enter into additional agreements in the future that could also contain restrictions on payments of cash dividends. Recent Sales of Unregistered Equity Securities There were no sales of unregistered equity securities during the year ended December 31, 2023.
The terms of our credit agreement with JPM and certain other lenders restrict our ability to pay dividends, and we may enter into additional agreements in the future that could also contain restrictions on payments of cash dividends. Recent Sales of Unregistered Equity Securities There were no sales of unregistered equity securities during the year ended December 31, 2024.
(2) Average price paid per share includes costs associated with the repurchases. 41 Table of Contents Stock Performance Graph This performance graph shall not be deemed “soliciting material” or “filed” with the SEC for purposes of Section 18 of the Exchange Act, and shall not be deemed to be incorporated by reference into any of our filings under the Securities Act or the Securities Exchange Act.
(2) Average price paid per share includes costs associated with the repurchases. 42 Table of Contents Stock Performance Graph This performance graph shall not be deemed “soliciting material” or “filed” with the SEC for purposes of Section 18 of the Exchange Act, and shall not be deemed to be incorporated by reference into any of our filings under the Securities Act or the Securities Exchange Act.
The graph below shows the cumulative total stockholder return on our Class A common stock between November 4, 2021 (the date that our Class A common stock commenced trading on the Nasdaq Global Market) through December 31, 2023 in comparison to the Nasdaq Composite Index and the S&P 500 Index.
The graph below shows the cumulative total stockholder return on our Class A common stock between November 4, 2021 (the date that our Class A common stock commenced trading on the Nasdaq Global Market) through December 31, 2024 in comparison to the Nasdaq Composite Index and the S&P 500 Index.
The timing and terms of any repurchases under the Repurchase Plan and the October 2023 Repurchase Plan are at management’s discretion and depend on a variety of factors, including business, economic and market conditions, regulatory requirements, prevailing stock prices and other considerations. Additionally, we may, from time to time, enter into Rule 10b5-1 trading plans to facilitate repurchases.
The timing and terms of any repurchases under the Repurchase Program are at management’s discretion and depend on a variety of factors, including business, economic and market conditions, regulatory requirements, prevailing stock prices and other considerations. Additionally, we may, from time to time, enter into Rule 10b5-1 trading plans to facilitate repurchases.
As of February 16, 2024, there were nine stockholders of record of our Class B common stock, all of which are trusts affiliated with Tim Chen, our Chief Executive Officer and the Chairman of the Board of Directors. Dividend Policy We have never declared or paid cash dividends on our capital stock.
As of February 14, 2025, there were nine stockholders of record of our Class B common stock, all of which are trusts affiliated with Tim Chen, our Chief Executive Officer and the Chairman of the Board of Directors. Dividend Policy We have never declared or paid cash dividends on our capital stock.
Our Class B common stock is neither listed nor publicly traded. Holders of Our Common Stock As of February 16, 2024, there were 127 stockholders of record of our Class A common stock.
Our Class B common stock is neither listed nor publicly traded. Holders of Our Common Stock As of February 14, 2025, there were 99 stockholders of record of our Class A common stock.
Under the Repurchase Plan and the October 2023 Repurchase Plan, shares of Class A common stock may be repurchased in the open market through privately negotiated transactions or otherwise, in accordance with applicable securities laws and other restrictions.
Under the Repurchase Program, shares of Class A common stock may be repurchased in the open market through privately negotiated transactions or otherwise, in accordance with applicable securities laws and other restrictions. The Repurchase Program does not have fixed expiration dates and does not obligate us to acquire any specific number of shares.
Removed
Following our utilization of the share repurchase authorization under the Repurchase Plan, we announced on October 26, 2023 that our Board of Directors authorized a new plan (the October 2023 Repurchase Plan) under which we may repurchase up to $30 million of our Class A common stock.
Removed
The Repurchase Plan and the October 2023 Repurchase Plan do not have fixed expiration dates and do not obligate us to acquire any specific number of shares.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeResults of Operations (in millions) Year Ended December 31, 2023 2022 2021 Revenue $ 599.4 $ 538.9 $ 379.6 Costs and expenses: Cost of revenue 54.0 39.8 28.5 Research and development (1) 80.5 77.6 62.2 Sales and marketing (1) 401.5 375.6 271.3 General and administrative (1) 59.8 58.2 38.5 Change in fair value of contingent consideration related to earnouts — 6.7 18.1 Total costs and expenses 595.8 557.9 418.6 Income (loss) from operations 3.6 (19.0) (39.0) Other income (expense), net: Interest income 3.6 1.5 — Interest expense (0.8) (2.5) (1.3) Other gains (losses), net (0.1) — 2.6 Total other income (expense), net 2.7 (1.0) 1.3 Income (loss) before income taxes 6.3 (20.0) (37.7) Income tax provision (benefit) 18.1 (9.8) 4.8 Net loss $ (11.8) $ (10.2) $ (42.5) ______________ (1) Includes stock-based compensation as follows: (in millions) Year Ended December 31, 2023 2022 2021 Research and development $ 11.2 $ 12.0 $ 6.8 Sales and marketing 13.8 12.4 5.8 General and administrative 13.8 10.0 5.3 Total $ 38.8 $ 34.4 $ 17.9 49 Table of Contents The following table sets forth the components of our consolidated statements of operations as a percentage of revenue: Year Ended December 31, 2023 2022 2021 Revenue 100 % 100 % 100 % Costs and expenses: Cost of revenue 9 7 8 Research and development 13 15 16 Sales and marketing 67 70 71 General and administrative 10 11 10 Change in fair value of contingent consideration related to earnouts — 1 5 Total costs and expenses 99 104 110 Income (loss) from operations 1 (4) (10) Other income (expense), net: Interest income — — — Interest expense — — — Other gains (losses), net — — — Total other income (expense), net — — — Income (loss) before income taxes 1 (4) (10) Income tax provision (benefit) 3 (2) 1 Net loss (2 %) (2 %) (11 %) Comparison of the Years Ended December 31, 2023 and 2022 Revenue (in millions) Year Ended December 31, 2023 2022 $ Change % Change Credit cards $ 209.7 $ 210.3 $ (0.6) (0 %) Loans 101.6 109.1 (7.5) (7 %) SMB products 101.2 91.4 9.8 11 % Emerging verticals 186.9 128.1 58.8 46 % Total revenue $ 599.4 $ 538.9 $ 60.5 11 % Revenue increased $60.5 million, or 11%, for 2023 compared to 2022, driven by strong growth in Emerging verticals and SMB products revenues, partially offset by lower Loans revenue.
Biggest changeResults of Operations (in millions) Year Ended December 31, 2024 2023 2022 Revenue $ 687.6 $ 599.4 $ 538.9 Costs and expenses: Cost of revenue 63.5 54.0 39.8 Research and development (1) 82.5 80.5 77.6 Sales and marketing (1) 470.6 401.5 375.6 General and administrative (1) 61.6 59.8 58.2 Change in fair value of contingent consideration related to earnouts — — 6.7 Total costs and expenses 678.2 595.8 557.9 Income (loss) from operations 9.4 3.6 (19.0) Other income (expense), net: Interest income 4.8 3.6 1.5 Interest expense (0.7) (0.8) (2.5) Other losses, net (8.5) (0.1) — Total other income (expense), net (4.4) 2.7 (1.0) Income (loss) before income taxes 5.0 6.3 (20.0) Income tax provision (benefit) (25.4) 18.1 (9.8) Net income (loss) $ 30.4 $ (11.8) $ (10.2) ______________ (1) Includes stock-based compensation as follows: (in millions) Year Ended December 31, 2024 2023 2022 Research and development $ 10.1 $ 11.2 $ 12.0 Sales and marketing 10.0 13.8 12.4 General and administrative 16.2 13.8 10.0 Total $ 36.3 $ 38.8 $ 34.4 50 Table of Contents The following table sets forth the components of our consolidated statements of operations as a percentage of revenue: Year Ended December 31, 2024 2023 2022 Revenue 100 % 100 % 100 % Costs and expenses: Cost of revenue 9 9 7 Research and development 12 13 15 Sales and marketing 69 67 70 General and administrative 9 10 11 Change in fair value of contingent consideration related to earnouts — — 1 Total costs and expenses 99 99 104 Income (loss) from operations 1 1 (4) Other income (expense), net: Interest income — — — Interest expense — — — Other losses, net — — — Total other income (expense), net — — — Income (loss) before income taxes 1 1 (4) Income tax provision (benefit) (3) 3 (2) Net income (loss) 4 % (2 %) (2 %) Our income from operations increased $5.8 million or 161% for 2024 compared to 2023.
Non-GAAP Financial Measures We use non-GAAP operating income (loss) and adjusted EBITDA in conjunction with GAAP measures as part of our overall assessment of our performance, including the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies, and to communicate with our Board of Directors concerning our financial performance.
We use non-GAAP operating income (loss) and adjusted EBITDA in conjunction with GAAP measures as part of our overall assessment of our performance, including the preparation of our annual operating budget and quarterly forecasts, to evaluate the effectiveness of our business strategies, and to communicate with our Board of Directors concerning our financial performance.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Components of Our Results of Operations—Non-GAAP Financial Measures” for reconciliations of non-GAAP operating income (loss) to income (loss) from operations, and adjusted EBITDA to net loss, the most directly comparable financial measures calculated in accordance with GAAP.
See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Key Components of Our Results of Operations—Non-GAAP Financial Measures” for reconciliations of non-GAAP operating income (loss) to income (loss) from operations, and adjusted EBITDA to net income (loss), the most directly comparable financial measures calculated in accordance with GAAP.
Because of these limitations, you should consider non-GAAP operating income (loss) and adjusted EBITDA alongside other financial performance measures, including income (loss) from operations, net loss and our other GAAP results.
Because of these limitations, you should consider non-GAAP operating income (loss) and adjusted EBITDA alongside other financial performance measures, including income (loss) from operations, net income (loss) and our other GAAP results.
Our effective tax rate for 2023 differs from the U.S. federal statutory income tax rate of 21% primarily due to the valuation allowance maintained against our net U.S. deferred tax assets and state taxes, partially offset by research and development credits.
Our effective tax rate for 2023 differs from the U.S. federal statutory income tax rate of 21% primarily due to the valuation allowance previously maintained against our net U.S. deferred tax assets and state taxes, partially offset by research and development credits.
Consumers who visit NerdWallet tend to share a few other characteristics that make them attractive customers to our financial services partners: we have received feedback from our financial services partners that our users’ approval rates can be significantly higher than those applying through other channels and they are more eager to explore additional opportunities and products, driving demand for NerdWallet’s financial services partners. 43 Table of Contents Our Financial Model We built our business to provide unbiased and trusted guidance to consumers.
Consumers who visit NerdWallet tend to share a few other characteristics that make them attractive customers to our financial services partners: we have received feedback from our financial services partners that our users’ approval rates can be significantly higher than those applying through other channels and they are more eager to explore additional opportunities and products, driving demand for NerdWallet’s financial services partners. 44 Table of Contents Our Financial Model We built our business to provide unbiased and trusted guidance to consumers.
On September 26, 2023, we, including three of our wholly-owned subsidiaries, entered into a credit agreement (the Credit Agreement) with JPMorgan Chase Bank, National Association. as Administrative Agent, and a syndicate of lenders.
Credit Facility: On September 26, 2023, we, including three of our wholly-owned subsidiaries, entered into a credit agreement (the Credit Agreement) with JPMorgan Chase Bank, National Association, as Administrative Agent, and a syndicate of lenders.
As such, we plan to continue investing in content, technology and marketing in order to attract and engage consumers. Ability to Deepen Our Relationships with Our Financial Services Partners We worked wit h hundreds of financial services partners during 2023. These companies are essential to helping us serve consumers and grow our business .
As such, we plan to continue investing in content, technology and marketing in order to attract and engage consumers. Ability to Deepen Our Relationships with Our Financial Services Partners We worked wit h hundreds of financial services partners during 2024. These companies are essential to helping us serve consumers and grow our business .
Our judgment regarding the likelihood of realization of these deferred tax assets could change in future periods, which could result in a material impact to our income tax provision in the period of change. 48 Table of Contents Comparison of Results of Operations The following tables set forth our results of operations for the periods presented.
Our judgment regarding the likelihood of realization of these deferred tax assets could change in future periods, which could result in a material impact to our income tax provision in the period of change. 49 Table of Contents Comparison of Results of Operations The following tables set forth our results of operations for the periods presented.
Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Except as otherwise noted, all references to 2023 refer to the year ended December 31, 2023, references to 2022 refer to the year ended December 31, 2022, and references to 2021 refer to the year ended December 31, 2021.
Our historical results are not necessarily indicative of the results that may be expected for any period in the future. Except as otherwise noted, all references to 2024 refer to the year ended December 31, 2024, references to 2023 refer to the year ended December 31, 2023, and references to 2022 refer to the year ended December 31, 2022.
For a discussion of our cash flows for 2022 and 2021, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations–Liquidity and Capital Resources” in our Annual Report on Form 10-K for the year ended December 31, 2022.
For a discussion of our cash flows for 2023 and 2022, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations–Liquidity and Capital Resources” in our Annual Report on Form 10-K for the year ended December 31, 2023.
We plan to continue investing in our growing base of high-value content and tools, which enable us to generate more traffic and grow MUUs , enhancing monetizing activities with our financial services partners and ultimately, our financial performance.
We plan to continue investing in our growing base of high-value content and tools, which enable us to generate more traffic, enhancing monetizing activities with our financial services partners and ultimately, our financial performance.
Ability to Attract and Engage Consumers Our ability to increase user engagement, whether by increasing the frequency with which MUUs visit our platform, or the amount of resources they consume on our platform, is critical to the growth of our business.
Ability to Attract and Engage Consumers Our ability to increase user engagement, whether by increasing the frequency with which consumers and SMBs visit our platform, or the amount of resources they consume on our platform, is critical to the growth of our business.
Non-GAAP operating income (loss): We define non-GAAP operating income (loss) as income (loss) from operations adjusted to exclude depreciation and amortization, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) change in fair value of contingent consideration related to earnouts, (4) deferred compensation related to earnouts, and (5) acquisition-related costs.
Non-GAAP operating income (loss): We define non-GAAP operating income (loss) as income (loss) from operations adjusted to exclude depreciation and amortization, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) change in fair value of contingent consideration related to earnouts, (4) deferred compensation related to earnouts, (5) acquisition-related costs, and (6) restructuring charges.
However, this percentage may fluctuate from period to period depending on the timing and extent of our sales and marketing expenses. General and administrative General and administrative expenses consist primarily of personnel related costs, including stock-based compensation, for certain of our executives as well as our legal, finance, human resources, and other administrative employees; and professional services fees.
However, this percentage may fluctuate from period to period depending on the timing and extent of our sales and marketing expenses. 48 Table of Contents General and administrative General and administrative expenses consist primarily of personnel related costs, including stock-based compensation, for certain of our executives as well as our legal, finance, human resources, and other administrative employees; and professional services fees.
For a discussion of our financial condition and results of operations for the year ended December 31, 2022 compared to the year ended December 31, 2021, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022.
For a discussion of our financial condition and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023.
Adjusted EBITDA: We define adjusted EBITDA as net income (loss) from continuing operations adjusted to exclude depreciation and amortization, interest income (expense), net, provision (benefit) for income taxes, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) change in fair value of contingent consideration related to earnouts, (4) deferred compensation related to earnouts, (5) stock-based compensation, and (6) acquisition-related costs.
Adjusted EBITDA: We define adjusted EBITDA as net income (loss) from continuing operations adjusted to exclude depreciation and amortization, interest income (expense), net, other gains (losses), net, and provision (benefit) for income taxes, and further exclude (1) impairment of right-of-use asset, (2) losses (gains) on disposals of assets, (3) change in fair value of contingent consideration related to earnouts, (4) deferred compensation related to earnouts, (5) stock-based compensation, (6) acquisition-related costs, and (7) restructuring charges.
However, this percentage may fluctuate from period to period depending on the timing and extent of our research and development expenses. 47 Table of Contents Sales and marketing Sales and marketing expenses include advertising and promotion costs, costs related to brand campaign fees, marketing, business operations team, and editorial personnel and related costs, including stock-based compensation.
However, this percentage may fluctuate from period to period depending on the timing and extent of our research and development expenses. Sales and marketing Sales and marketing expenses include advertising and promotion costs, costs related to brand campaign fees, marketing, business operations team, and editorial personnel and related costs, including stock-based compensation.
Our tax provision for 2023 primarily resulted from the requirement for us to capitalize and amortize research and development expenses, and an overall increase in our profitability before taxes.
Our tax benefit for 2023 primarily resulted from the requirement for us to capitalize and amortize research and development expenses, and an overall increase in our profitability before taxes.
Known Contractual and Other Obligations A description of contractual commitments as of December 31, 2023 is included in Note 8–Commitments and Contingencies in the notes to the consolidated financial statements.
Known Contractual and Other Obligations A description of contractual commitments as of December 31, 2024 is included in Note 8–Commitments and Contingencies in the notes to the consolidated financial statements.
A discussion and analysis of our financial condition and results of operations for the year ended December 31, 2023 compared to the year ended December 31, 2022 is presented below.
A discussion and analysis of our financial condition and results of operations for the year ended December 31, 2024 compared to the year ended December 31, 2023 is presented below.
As a result of the goodwill impairment assessments in 2023, 2022 and 2021, we determined that it was not more likely than not that the fair value of its single reporting unit was less than its carrying amount. As such, goodwill was not impaired during 2023, 2022 and 2021.
As a result of the goodwill impairment assessments in 2024, 2023 and 2022, we determined that it was not more likely than not that the fair value of its single reporting unit was less than its carrying amount. As such, goodwill was not impaired during 2024, 2023 or 2022.
Subject to market conditions and other factors, the Repurchase Plans are intended to make opportunistic repurchases of our Class A common stock to reduce our outstanding share count. Under the Repurchase Plans, shares of Class A common stock may be repurchased in the open market through privately negotiated transactions or otherwise, in accordance with applicable securities laws and other restrictions.
Subject to market conditions and other factors, the Repurchase Program is intended to make opportunistic repurchases of our Class A common stock to reduce our outstanding share count. Under the Repurchase Program, shares of Class A common stock may be repurchased in the open market through privately negotiated transactions or otherwise, in accordance with applicable securities laws and other restrictions.
The Repurchase Plans do not have fixed expiration dates and do not obligate us to acquire any specific number of shares. The timing and terms of any repurchases under the Repurchase Plans are at management’s discretion and depend on a variety of factors, including business, economic and market conditions, regulatory requirements, prevailing stock prices and other considerations.
The Repurchase Program does not have fixed expiration dates and does not obligate us to acquire any specific number of shares. The timing and terms of any repurchases under the Repurchase Program are at management’s discretion and depend on a variety of factors, including business, economic and market conditions, regulatory requirements, prevailing stock prices and other considerations.
The success of our relationships with financial services partners is in large part based on our ability to provide them with interested and qualified consumers. 44 Table of Contents Economic Conditions and the Financial Well-Being of Consumers Our business is reliant on economic conditions in the U.S.
The success of our relationships with financial services partners is in large part based on our ability to provide them with interested and qualified consumers. Economic Conditions and the Financial Well-Being of Consumers Our business is reliant on economic conditions in the U.S.
As of December 31, 2022, Fundera Inc.’s revenue and profitability milestones for 2022 were achieved and the contingent consideration liability was recorded at the full payout amount, with the contingent consideration liability paid in full during 2023. Other income (expense), net Other income (expense), net is comprised of interest income, interest expense, and other gains (losses), net.
As of December 31, 2022, Fundera’s revenue and profitability milestones for 2022 were achieved and the contingent consideration liability was recorded at the full payout amount, with the contingent consideration liability paid in full during 2023. Other income (expense), net Other income (expense), net is comprised of interest income, interest expense, and other gains (losses), net.
Overview Our mission is to provide clarity for all of life’s financial decisions. Our vision is a world where everyone makes financial decisions with confidence. At NerdWallet, we empower consumers—both individuals and SMBs—to make smarter financial decisions with confidence via our digital platform.
Overview Our mission is to provide clarity for all of life’s financial decisions. Our vision is a world where everyone makes financial decisions with confidence. At NerdWallet, we empower consumers—both individuals and small and mid-sized businesses (SMBs)—to make smarter financial decisions with confidence via our digital platform.
We increased sales and marketing expense in 2022 by 38% compared to 2021, and in 2023 by 7% compared to 2022. In 2023, over 70% of all traffic to NerdWallet came organically through direct or unpaid channels, reflecting the strength of our brand and organic marketing efforts.
We increased sales and marketing expense in 2023 by 7% compared to 2022, and in 2024 by 17% compared to 2023. In 2024, over 70% of all traffic to NerdWallet came organically through direct or unpaid channels, reflecting the strength of our brand and organic marketing efforts.
We believe the acquisition will allow us to accelerate our international growth. 45 Table of Contents Key Operating Metric and Non-GAAP Financial Measures We collect, review and analyze operating and financial data of our business to assess our ongoing performance and compare our results to prior period results.
We believe the acquisition will allow us to accelerate our international growth. 46 Table of Contents Non-GAAP Financial Measures We collect, review and analyze operating and financial data of our business to assess our ongoing performance and compare our results to prior period results.
Liquidity and Capital Resources Overview Our principal sources of liquidity to meet our business requirements and plans, both in the short-term (i.e., the next twelve months from December 31, 2023) and long-term (i.e., beyond the next twelve months), have historically been cash generated from operations and, more recently, sales of our common stock, and borrowings under our credit facilities.
Liquidity and Capital Resources Overview Our principal sources of liquidity to meet our business requirements and plans, both in the short-term (i.e., the next twelve months from December 31, 2024) and long-term (i.e., beyond the next twelve months), have historically been cash generated from operations and, more recently, borrowings under our credit facilities.
The Credit Agreement provides for a $125.0 million senior secured revolving credit facility (the Credit Facility), with the option to increase up to an additional $75.0 million, and is available to be used by us and certain of our domestic subsidiaries for general corporate purposes, including acquisitions. The Credit Facility matures on September 26, 2028.
The Credit Agreement provides for a $125.0 million senior secured revolving credit facility (the Credit Facility), with the option to increase up to an additional $75.0 million, and is available to be used by us and certain of our domestic subsidiaries for general corporate purposes, including acquisitions.
We compensate for these limitations by reconciling non-GAAP operating income (loss) to income (loss) from operations, and adjusted EBITDA to net loss, the most comparable GAAP financial measures, as follows: (in millions) Year Ended December 31, 2023 2022 2021 Income (loss) from operations $ 3.6 $ (19.0) $ (39.0) Depreciation and amortization 48.2 37.0 27.1 Acquisition-related retention 5.3 2.8 — Deferred compensation related to earnouts — 1.7 2.1 Impairment of right-of-use asset 1.4 — — Loss on disposal of assets 0.2 — 0.8 Change in fair value of contingent consideration related to earnouts — 6.7 18.1 Acquisition-related expenses 0.1 3.5 0.1 Capitalized internally developed software costs (32.4) (33.7) (24.0) Non-GAAP operating income (loss) $ 26.4 $ (1.0) $ (14.8) Operating income (loss) margin 1 % (4 %) (10 %) Non-GAAP operating income (loss) margin 1 4 % (0 %) (4 %) Net loss $ (11.8) $ (10.2) $ (42.5) Depreciation and amortization 48.2 37.0 27.1 Stock-based compensation 38.8 34.4 17.9 Acquisition-related retention 5.3 2.8 — Deferred compensation related to earnouts — 1.7 2.1 Impairment of right-of-use asset 1.4 — — Loss on disposal of assets 0.2 — 0.8 Change in fair value of contingent consideration related to earnouts — 6.7 18.1 Acquisition-related expenses 0.1 3.5 0.1 Interest (income) expense, net (2.8) 1.0 1.3 Other (gains) losses, net 0.1 — (2.6) Income tax provision (benefit) 18.1 (9.8) 4.8 Adjusted EBITDA $ 97.6 $ 67.1 $ 27.1 Stock-based compensation (38.8) (34.4) (17.9) Capitalized internally developed software costs (32.4) (33.7) (24.0) Non-GAAP operating income (loss) $ 26.4 $ (1.0) $ (14.8) Net loss margin (2 %) (2 %) (11 %) Adjusted EBITDA margin 2 16 % 12 % 7 % ______________ (1) Represents non-GAAP operating income (loss) as a percentage of revenue.
We compensate for these limitations by reconciling non-GAAP operating income (loss) to income (loss) from operations, and adjusted EBITDA to net income (loss), the most directly comparable GAAP financial measures, as follows: (in millions) Year Ended December 31, 2024 2023 2022 Income (loss) from operations $ 9.4 $ 3.6 $ (19.0) Depreciation and amortization 48.4 48.2 37.0 Acquisition-related retention 4.2 5.3 2.8 Deferred compensation related to earnouts — — 1.7 Impairment of right-of-use asset — 1.4 — Loss on disposal of assets — 0.2 — Change in fair value of contingent consideration related to earnouts — — 6.7 Acquisition-related expenses 0.6 0.1 3.5 Restructuring 9.0 — — Capitalized internally developed software costs (24.0) (32.4) (33.7) Non-GAAP operating income (loss) $ 47.6 $ 26.4 $ (1.0) Operating income (loss) margin 1 % 1 % (4 %) Non-GAAP operating income (loss) margin 1 7 % 4 % (0 %) Net income (loss) $ 30.4 $ (11.8) $ (10.2) Depreciation and amortization 48.4 48.2 37.0 Stock-based compensation 36.3 38.8 34.4 Acquisition-related retention 4.2 5.3 2.8 Deferred compensation related to earnouts — — 1.7 Impairment of right-of-use asset — 1.4 — Loss on disposal of assets — 0.2 — Change in fair value of contingent consideration related to earnouts — — 6.7 Acquisition-related expenses 0.6 0.1 3.5 Restructuring 9.0 — — Interest (income) expense, net (4.1) (2.8) 1.0 Other losses, net 8.5 0.1 — Income tax provision (benefit) (25.4) 18.1 (9.8) Adjusted EBITDA $ 107.9 $ 97.6 $ 67.1 Stock-based compensation (36.3) (38.8) (34.4) Capitalized internally developed software costs (24.0) (32.4) (33.7) Non-GAAP operating income (loss) $ 47.6 $ 26.4 $ (1.0) Net income (loss) margin 4 % (2 %) (2 %) Adjusted EBITDA margin 2 16 % 16 % 12 % ______________ (1) Represents non-GAAP operating income (loss) as a percentage of revenue.
Conversely, when interest rates increase, we see slowed consumer demand for loans and accelerated demand for banking products. Marketing Our marketing strategy leverages multiple channels across brand marketing, performance marketing and organic marketing.
Conversely, when interest rates increase, we see slowed consumer demand for loans and accelerated demand for banking products. 45 Table of Contents Marketing Our marketing strategy leverages multiple channels across brand marketing, performance marketing and organic marketing.
Although these are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and non-GAAP operating income (loss) and adjusted EBITDA do not reflect all cash requirements for such replacements or for new capital expenditure requirements; 46 Table of Contents • Non-GAAP operating income (loss) and adjusted EBITDA exclude acquisition-related costs, including acquisition-related retention compensation under compensatory retention agreements with certain key employees, acquisition-related transaction expenses, contingent consideration fair value adjustments related to earnouts, and deferred compensation related to earnouts; • Adjusted EBITDA excludes stock-based compensation, including for acquisition-related inducement awards, which has been, and will continue to be for the foreseeable future, a significant recurring expense in our business and an important part of our compensation strategy; and • Adjusted EBITDA does not reflect interest income (expense) and other gains (losses), net, which include unrealized and realized gains and losses on foreign currency exchange, as well as certain nonrecurring gains (losses).
Although these are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and non-GAAP operating income (loss) and adjusted EBITDA do not reflect all cash requirements for such replacements or for new capital expenditure requirements; • Non-GAAP operating income (loss) and adjusted EBITDA exclude certain acquisition-related costs, including acquisition-related retention compensation under compensatory retention agreements with certain key employees, acquisition-related transaction expenses, contingent consideration fair value adjustments related to earnouts, and deferred compensation related to earnouts; • Non-GAAP operating income (loss) and adjusted EBITDA exclude restructuring charges primarily consisting of severance payments, stock-based compensation, employee benefits, and related expenses for impacted employees, as well as contract termination costs, associated with our Restructuring Plan; • Adjusted EBITDA excludes stock-based compensation, including for acquisition-related inducement awards, which has been, and will continue to be for the foreseeable future, a significant recurring expense in our business and an important part of our compensation strategy; and • Adjusted EBITDA does not reflect interest income (expense) and other gains (losses), net, which include unrealized and realized gains and losses on foreign currency exchange, as well as certain nonrecurring gains (losses). 47 Table of Contents In addition, non-GAAP operating income (loss) and adjusted EBITDA as we define them may not be comparable to similarly titled measures used by other companies.
As of December 31, 2023, amounts to be spent under non-cancellable purchase obligations were $6.8 million over the next twelve months, and approximately $6 million in 2025 and $5 million in 2026. 54 Table of Contents Trends, Uncertainties and Anticipated Sources of Funds In order to grow our business, we intend to make significant investments in our business, which may result in increases in our personnel and related expenses.
As of December 31, 2024, amounts to be spent under non-cancellable purchase obligations were $18.4 million over the next twelve months, and approximately $9 million in 2026. Trends, Uncertainties and Anticipated Sources of Funds In order to grow our business, we intend to make significant investments in our business, which may result in increases in our personnel and related expenses.
Income tax provision (benefit) Our income tax provision (benefit) consists of federal and state income taxes. We have federal and state net operating loss carryforwards (NOLs), and federal and California research and development credit carryforwards, certain of which are subject to expiration dates if not utilized.
We have federal and state net operating loss carryforwards (NOLs), and California research and development credit carryforwards, certain of which are subject to expiration dates if not utilized.
In 2023, approximately 21% of our total marketing expense was attributable to brand marketing, 51% to performance marketing, and the remainder to organic and other marketing expenses. In 2022, approximately 28% of our total marketing expense was attributable to brand marketing, 45% to performance marketing, and the remainder to organic and other marketing expenses.
In 2024, approximately 15% of our total marketing expense was attributable to brand marketing, 63% to performance marketing, and the remainder to organic and other marketing expenses. In 2023, approximately 21% of our total marketing expense was attributable to brand marketing, 51% to performance marketing, and the remainder to organic and other marketing expenses.
We announced on May 2, 2023 that our Board of Directors authorized a plan under which we may repurchase up to $20 million of our Class A common stock and, following our utilization of that share repurchase authorization, we announced on October 26, 2023 that our Board of Directors approved a new share repurchase authorization under which we may repurchase up to an additional $30 million of our Class A common stock (collectively, the Repurchase Plans).
Share Repurchase Program: We announced on May 2, 2023 that our Board of Directors authorized a plan under which we may repurchase up to $20 million of our Class A common stock and, following our utilization of that share repurchase authorization, we announced on October 26, 2023, September 9, 2024 and October 29, 2024 that our Board of Directors approved additional share repurchase authorizations under which we may repurchase up to an additional $30 million, $50 million and $25 million, respectively, of our Class A common stock (collectively, the Repurchase Program).
Our revenue generally includes four product categories: Credit cards, Loans, SMB products and Emerging verticals. Credit cards revenue includes revenue from consumer credit cards. Loans revenue includes revenue from personal loans, home mortgages, student loans and auto loans. SMB products revenue includes revenue from loans, credit cards and other financial products and services intended for small and mid-sized businesses.
Our revenue generally includes five product categories: Insurance, Credit cards, SMB products, Loans and Emerging verticals. Insurance revenue includes revenue from consumer insurance products, including auto, life and pet insurance. Credit cards revenue includes revenue from consumer credit cards. SMB products revenue includes revenue from loans, credit cards and other financial products and services intended for small and mid-sized businesses.
Emerging verticals revenue includes revenue from other product sources, including banking, insurance, investing and international. Cost of revenue Cost of revenue consists primarily of amortization expense associated with capitalized software development costs and developed technology intangible assets related to our acquisitions, credit scoring fees, account linking fees , and third-party data center costs.
Cost of revenue Cost of revenue consists primarily of amortization expense associated with capitalized software development costs and developed technology intangible assets related to our acquisitions, credit scoring fees, account linking fees , and third-party data center costs.
We cannot provide assurance that additional financing will be available at all or on terms favorable to us. 55 Table of Contents Sources and Uses of Capital Resources The following table summarizes our cash flows: (in millions) Year Ended December 31, 2023 2022 2021 Net cash provided by operating activities $ 72.1 $ 25.0 $ 7.2 Net cash used in investing activities (29.5) (100.3) (23.0) Net cash provided by (used in) financing activities (26.2) (8.4) 100.2 Effect of exchange rate changes on cash and cash equivalents 0.1 (0.2) — Net increase (decrease) in cash and cash equivalents $ 16.5 $ (83.9) $ 84.4 A discussion and analysis of our changes in cash flows for 2023 compared to 2022 is presented below.
Sources and Uses of Capital Resources The following table summarizes our cash flows: (in millions) Year Ended December 31, 2024 2023 2022 Net cash provided by operating activities $ 71.8 $ 72.1 $ 25.0 Net cash used in investing activities (29.7) (29.5) (100.3) Net cash used in financing activities (76.5) (26.2) (8.4) Effect of exchange rate changes on cash and cash equivalents 0.3 0.1 (0.2) Net increase (decrease) in cash and cash equivalents $ (34.1) $ 16.5 $ (83.9) A discussion and analysis of our changes in cash flows for 2024 compared to 2023 is presented below.
The increase reflects $3.6 million of income from operations for 2023 as compared to a loss from operations of $19.0 million for 2022, and $2.7 million of other income, net in 2023 as compared to other expense, net of $1.0 million in 2022, which were more than offset by an $18.1 million income tax provision in 2023 as compared to an income tax benefit of $9.8 million in 2022.
The change reflects a $5.8 million increase in income from operations, and $4.4 million of other expense, net in 2024 as compared to other income, net of $2.7 million in 2023, which were more than offset by a $25.4 million income tax benefit in 2024 as compared to an income tax provision of $18.1 million in 2023.
For additional information on these covenants, see Note 7–Debt in the notes to the consolidated financial statements. Our future capital requirements may vary materially from those planned and will depend on certain factors, such as our growth and our operating results.
NDL was in compliance with all covenants as of December 31, 2024. See Note 7–Debt in the notes to the consolidated financial statements for further discussion. Our future capital requirements may vary materially from those planned and will depend on certain factors, such as our growth and our operating results.
We believe our current cash and cash equivalents and future cash flow from operations, as well as access to our credit facility with JPMorgan Chase Bank and a syndicate of other lenders, subject to customary borrowing conditions, will be sufficient to meet our ongoing working capital, capital expenditure and other liquidity requirements for the next twelve months and beyond.
During 2024, we repurchased 6.5 million shares of Class A common stock for $80.4 million, including costs associated with the repurchases. 55 Table of Contents We believe our current cash and cash equivalents and future cash flow from operations, as well as access to our credit facility with JPMorgan Chase Bank and a syndicate of other lenders, subject to customary borrowing conditions, will be sufficient to meet our ongoing working capital, capital expenditure and other liquidity requirements for the next twelve months and beyond.
If we require additional capital resources to grow our business or to acquire complementary technologies and businesses in the future, we may seek to sell additional equity or raise funds through debt financing or other sources.
If we require additional capital resources to grow our business or to acquire complementary technologies and businesses in the future, we may seek to sell additional equity or raise funds through debt financing or other sources. We cannot provide assurance that additional financing will be available at all or on terms favorable to us.
Financing activities Net cash used in financing activities increased $17.8 million in 2023, primarily due to $20.0 million for repurchases of Class A common stock, partially offset a $2.5 million increase from exercises of stock options and a $2.1 million decrease in payments for contingent consideration recorded at the acquisition date.
Financing activities Net cash used in financing activities increased $50.3 million in 2024, primarily due to a $60.1 million increase in repurchases of Class A common stock, a $3.9 million decrease from exercises of stock options and a $2.0 million net payment on our warehouse line of credit, partially offset by a $16.9 million payment in 2023 for contingent consideration recorded at the acquisition date.
Our primary liquidity needs are related to the funding of general business requirements, including working capital requirements, research and development, and capital expenditures, as well as other liquidity requirements including, but not limited to, business combinations.
Our primary liquidity needs are related to the funding of general business requirements, including working capital requirements, research and development, and capital expenditures, as well as other liquidity requirements including, but not limited to, business combinations. As of December 31, 2024 and 2023, we had cash and cash equivalents of $66.3 million and $100.4 million, respectively.
Based on our ongoing assessment of all available evidence, both positive and negative, including consideration of our historical profitability and the estimated impact of our operating model on future profitability, we concluded that it is more likely than not that our U.S. deferred tax assets in excess of deferred tax liabilities would not be realized and recorded a valuation allowance against these net U.S. deferred tax assets as of December 31, 2023.
In the fourth quarter of 2024, based on our ongoing assessment of all available evidence, both positive and negative, including a significant improvement in our profitability coupled with anticipated future earnings, we concluded that it is more likely than not that our U.S. federal and majority state deferred tax assets in excess of deferred tax liabilities would be realized and released $27.2 million of our valuation allowance against these net U.S. deferred tax assets as of December 31, 2024.
Based on our ongoing assessment of all available evidence, both positive and negative, including consideration of our historical profitability and the estimated impact of our operating model on future profitability, we concluded that it was more likely than not that our U.S. deferred tax assets in excess of deferred tax liabilities would not be realized and recorded a valuation allowance against these net U.S. deferred tax assets as of December 31, 2023.
Based on our past assessment of all available evidence, both positive and negative, including consideration of our historical profitability and the estimated impact of our operating model on future profitability, we had previously maintained a valuation allowance against our net U.S. deferred tax assets as of December 31, 2023.
Additionally, we may, from time to time, enter into Rule 10b-5 trading plans to facilitate repurchases. Shares repurchased under the Repurchase Plans are retired. We expect to fund repurchases with existing cash and cash equivalents. During 2023, we repurchased 2.3 million shares of Class A common stock for $20.0 million, including costs associated with the repurchases.
Additionally, we may, from time to time, enter into Rule 10b-5 trading plans to facilitate repurchases. Shares repurchased under the Repurchase Program are retired. We expect to fund repurchases with existing cash and cash equivalents.
As the financial services industry becomes more fragmented and complex, we believe the need for trustworthy and knowledgeable financial guidance increases. Our objective remains the same: serve as a trusted financial ecosystem that consumers and SMBs can rely on to learn about various financial topics, shop for products, connect their data and receive data-driven nudges.
Our objective remains the same: serve as a trusted financial ecosystem that consumers and SMBs can rely on to learn about various financial topics, shop for products, connect their data and receive data-driven nudges. We deliver guidance to consumers through educational content, tools and calculators, product marketplaces and our app.
In addition, non-GAAP operating income (loss) and adjusted EBITDA as we define them may not be comparable to similarly titled measures used by other companies. Because of these limitations, you should consider non-GAAP operating income (loss) and adjusted EBITDA alongside other financial performance measures, including income (loss) from operations, net loss and our other GAAP results.
Because of these limitations, you should consider non-GAAP operating income (loss) and adjusted EBITDA alongside other financial performance measures, including income (loss) from operations, net income (loss) and our other GAAP results.
We received net proceeds from the IPO of $140.0 million after deducting underwriting discounts and commissions of $10.1 million. Key Factors Affecting Our Performance Ability to Generate High Quality, Engaging Consumer Resources Delivering financial guidance and resources on a broad set of topics is core to our value proposition.
Key Factors Affecting Our Performance Ability to Generate High Quality, Engaging Consumer Resources Delivering financial guidance and resources on a broad set of topics is core to our value proposition.
Sales and marketing expenses increased $25.9 million, or 7%, for 2023 compared to 2022.
Sales and marketing expenses increased $69.1 million, or 17%, for 2024 compared to 2023.
Given the success of our Fundera acquisition within our SMB products verticals, we are leveraging our vertical integration playbook to fully integrate OTB’s technology and expertise within our Loans portfolio.
In July 2022, we acquired On the Barrelhead, Inc. (OTB), a data-driven platform that provides consumers and SMBs with credit-driven product recommendations. Given the success of our Fundera acquisition within our SMB products verticals, we are leveraging our vertical integration playbook to fully integrate OTB’s technology and expertise within our Loans portfolio.
Our effective tax rate was 286.7% and 49.2% for 2023 and 2022, respectively, as compared to the U.S. federal statutory income tax rate of 21%.
Income tax provision (benefit) We had an income tax benefit of $25.4 million for 2024, as compared to an income tax provision of $18.1 million in 2023. Our effective tax rate was (505.5%) and 286.7% for 2024 and 2023, respectively, as compared to the U.S. federal statutory income tax rate of 21%.
After doing research on our platform, consumers are better informed about the financial decision they’re about to make, which makes them primed and ready to transact.
By operating at the intersection of consumers and financial services providers, NerdWallet drives value for both. Through our platform, our financial services partners can reach a substantial audience. After doing research on our platform, consumers are better informed about the financial decision they’re about to make, which makes them primed and ready to transact.
As a result, we recorded a significant U.S. current tax provision in 2023 with no corresponding deferred tax benefit for such capitalized expenses due to the valuation allowance maintained against our net U.S. deferred tax assets.
As a result, we recorded a significant U.S. current tax provision in 2023 with no corresponding deferred tax benefit for such capitalized expenses due to the valuation allowance maintained against our net U.S. deferred tax assets. 53 Table of Contents Non-GAAP Financial Measures Non-GAAP operating income (loss) and adjusted EBITDA as we define them may not be comparable to similarly titled measures used by other companies.
The increase was primarily attributable to increases of $38.1 million in performance marketing expenses and $9.7 million in organic and other marketing expenses primarily due to higher personnel-related costs due to our efforts to grow and increase our user base, partially offset by a $21.9 million decrease in brand marketing expenses.
The increase was attributable to a $90.9 million increase in performance marketing expenses, partially offset by decreases of $15.8 million in brand marketing expenses and $6.0 million in organic and other marketing expenses primarily due to lower personnel-related costs partially offset by a $2.0 million restructuring charge.
We expanded our guidance to the UK with our acquisition of Know Your Money (KYM) in 2020, and expanded organically into Canada during 2021 as well as Australia during 2022. Across every touchpoint, the cornerstone of our platform is consumers’ trust in the independent, objective and relevant guidance we provide, free of charge.
Across every touchpoint, the cornerstone of our platform is consumers’ trust in the independent, objective and relevant guidance we provide, free of charge.
Interest income consists primarily of interest earned on our cash and cash equivalents. Interest expense consists of interest costs related to our revolving credit facility and long-term debt, including amortization of the debt premium on our long-term debt.
Interest income consists primarily of interest earned on our cash and cash equivalents. Interest expense consists of interest costs related to our revolving credit facility, including amortization of debt issuance costs. Other gains (losses), net for 2024 includes an $8.1 million impairment on an equity investment.
We had non-GAAP operating income of $26.4 million for 2023, as compared to a non-GAAP operating loss of $1.0 million for 2022.
We had net income of $30.4 million for 2024, as compared to a net loss of $11.8 million for 2023.
Under the terms of our Prior Credit Agreement, we could have borrowed up to $100.0 million, subject to borrowing conditions. We had no outstanding balance on our credit facility as of December 31, 2023 or 2022. Our credit facility contains certain financial and non-financial covenants. We were in compliance with all covenants as of December 31, 2023 and 2022.
We had no outstanding balance on our credit facility as of December 31, 2024 or 2023. Our credit facility contains certain financial and non-financial covenants. We were in compliance with all covenants as of December 31, 2024 and 2023. See Note 7–Debt in the notes to the consolidated financial statements for further discussion.
Other income (expense), net (in millions) Year Ended December 31, 2023 2022 $ Change % Change Interest income $ 3.6 $ 1.5 $ 2.1 135 % Interest expense (0.8) (2.5) 1.7 (69 %) Other losses, net (0.1) — (0.1) 85 % Total other income (expense), net $ 2.7 $ (1.0) $ 3.7 NM The change in other income (expense), net for 2023 compared to 2022 was primarily attributable to higher interest income reflecting higher interest rates and average cash balances, and lower interest expense related to debt activity. 51 Table of Contents Income tax provision (benefit) We had an income tax provision of $18.1 million for 2023, as compared to an income tax benefit of $9.8 million in 2022.
General and administrative expense General and administrative expenses increased $1.8 million, or 3%, for 2024 compared to 2023, primarily attributable to a $1.2 million restructuring charge as well as higher personnel-related costs mainly due to stock-based compensation. 52 Table of Contents Other income (expense), net (in millions) Year Ended December 31, 2024 2023 $ Change % Change Interest income $ 4.8 $ 3.6 $ 1.2 33 % Interest expense (0.7) (0.8) 0.1 (8 %) Other losses, net (8.5) (0.1) (8.4) NM Total other income (expense), net $ (4.4) $ 2.7 $ (7.1) NM The change in other income (expense), net for 2024 compared to 2023 was primarily attributable to an $8.1 million impairment on an equity investment, partially offset by higher interest income reflecting higher interest rates and average cash balances.
Acquisitions We have made acquisitions to expand into new verticals; to enter new markets and geographies; and to grow our platform so that our users have better outcomes. Our recent acquisitions include: • On the Barrelhead. In July 2022, we acquired On the Barrelhead, Inc. (OTB), a data-driven platform that provides consumers and SMBs with credit-driven product recommendations.
Acquisitions We have made acquisitions to expand into new verticals; to enter new markets and geographies; and to grow our platform so that our users have better outcomes. Our recent acquisitions include: • Next Door Lending.
Our judgment regarding the likelihood of realization of these deferred tax assets could change in future periods, which could result in a material impact to our income tax provision in the period of change.
Our judgment regarding the likelihood of realization of these deferred tax assets could change in future periods, which could result in a material impact to our income tax provision in the period of change. 57 Table of Contents Recently Issued and Adopted Accounting Pronouncements For information on recent accounting pronouncements, see Note 1–The Company and its Significant Accounting Policies in the notes to the consolidated financial statements.
Operating activities Net cash provided by operating activities increased $47.1 million in 2023 compared to 2022 driven by a $25.9 million decrease in net cash outflow from changes in operating assets and liabilities and a $22.8 million increase in non-cash charges, partially offset by a $1.6 million increase in net loss.
Operating activities Net cash provided by operating activities decreased $0.3 million in 2024 compared to 2023 as the impact of net income of $30.4 million in 2024 as compared to a net loss of $11.8 million in 2023 was more than offset by a $41.4 million decrease in non-cash charges and a $1.1 million increase in net cash outflow from changes in operating assets and liabilities.
Research and development expense Research and development expenses increased $2.9 million, or 4%, for 2023 compared to 2022. The increase was primarily attributable to increases of $1.6 million in personnel-related costs for our engineering, data, and product management personnel and contractors to support our continued growth, and $1.5 million in software and technology costs related to our platform.
The increase was primarily attributable to increases of $6.5 million primarily related to third-party service charges and $3.9 million in amortization expense related to capitalized software development costs, partially offset by a $1.6 million decrease in amortization expense related to intangible assets. Research and development expense Research and development expenses increased $2.0 million, or 3%, for 2024 compared to 2023.
In addition to revenue, net income and other results under generally accepted accounting principles (GAAP), the following sets forth the key operating metric we use to evaluate our business. Monthly Unique Users We define a Monthly Unique User (MUU) as a unique user with at least one session in a given month as determined by a unique device identifier.
In addition to revenue, net income (loss) and other results under generally accepted accounting principles (GAAP), the following sets forth the non-GAAP financial measures we use to evaluate our business.
The increase was primarily attributable to increases in adjustments to reconcile adjusted EBITDA to net loss, including$27.9 million for income taxes, $11.2 million for depreciation and amortization, and $4.4 million for stock-based compensation, partially offset by decreases of $6.7 million for the change in fair value of contingent consideration related to earnouts, $3.4 million for acquisition-related expenses, and $3.8 million for interest income (expense), net.
The increase was primarily attributable to net income of $30.4 million for 2024, as compared to a net loss of $11.8 million for 2023, partially offset by a decrease in adjustments to reconcile adjusted EBITDA to net income (loss), including $43.5 million for income taxes and $2.5 million for stock-based compensation, partially offset by a $9.0 million restructuring charge and an $8.4 million increase in other losses, net.
Emerging verticals revenue increased $58.8 million, or 46%, for 2023 compared to 2022, primarily driven by increases of 74% in banking revenue mainly due to the higher interest rate environment and 30% in insurance products mainly driven by auto insurance. 50 Table of Contents Costs and Expenses (in millions) Year Ended December 31, 2023 2022 $ Change % Change Cost of revenue $ 54.0 $ 39.8 $ 14.2 36 % Research and development 80.5 77.6 2.9 4 % Sales and marketing 401.5 375.6 25.9 7 % General and administrative 59.8 58.2 1.6 3 % Change in fair value of contingent consideration related to earnouts — 6.7 (6.7) (100 %) Total costs and expenses $ 595.8 $ 557.9 $ 37.9 7 % Cost of revenue Cost of revenue increased $14.2 million, or 36%, for 2023 compared to 2022.
Costs and Expenses (in millions) Year Ended December 31, 2024 2023 $ Change % Change Cost of revenue $ 63.5 $ 54.0 $ 9.5 17 % Research and development 82.5 80.5 2.0 3 % Sales and marketing 470.6 401.5 69.1 17 % General and administrative 61.6 59.8 1.8 3 % Total costs and expenses $ 678.2 $ 595.8 $ 82.4 14 % Cost of revenue Cost of revenue increased $9.5 million, or 17%, for 2024 compared to 2023.
The decrease was primarily driven by a $20.0 million decrease in loss from operations, partially offset by decreases in adjustments to reconcile loss from operations to non-GAAP operating loss, including $11.4 million for the change in fair value of contingent consideration related to earnouts and $9.7 million for capitalized internally developed software costs, partially offset by increases of $9.9 million for depreciation and amortization, and $3.4 million for acquisition-related expenses and $2.8 million for acquisition-related retention.
The increase was driven by increases of $5.8 million in income from operations, and $15.4 million in adjustments to reconcile income from operations to non-GAAP operating income, including a $9.0 million restructuring charge and an $8.4 million decrease in capitalized internally developed software costs.. Adjusted EBITDA increased $10.3 million, or 10%, for 2024 compared to 2023.
The increase in non-cash charges was primarily due to increases of $12.1 million in deferred taxes, $11.2 million in depreciation and amortization, and $4.4 million in stock-based compensation, partially offset by a $6.7 million decrease in change in fair value of contingent consideration related to earnouts.
The decrease in non-cash charges was primarily due to a $45.6 million decrease in deferred taxes, partially offset by a $5.7 million increase in other losses, net.
The decrease in net cash outflow from changes in operating assets and liabilities was primarily due to decreases of $29.4 million for accounts receivable, and $7.8 million for other liabilities, partially offset by an $8.2 million increase for accrued expenses and other current liabilities.
The increase in net cash outflow from changes in operating assets and liabilities was primarily due to increases of $37.7 million for accounts receivable and $5.1 million for other liabilities, partially offset by decreases of $14.9 million for accrued expenses and other current liabilities, $8.4 million for accounts payable, $2.6 million for prepaid expenses and other current assets, and $2.1 million for mortgage loans held for sale, as well as a $14.0 million payment for contingent consideration in 2023. 56 Table of Contents Investing activities Net cash used in investing activities increased $0.2 million in 2024 compared to 2023, primarily due to an $8.1 million purchase of an investment and $0.3 million of cash paid, net of cash acquired, for our acquisition of NDL in 2024, substantially offset by an $8.1 million decrease in capitalized software development costs.
The decrease was driven by a $159.3 million increase in revenues, largely offset by a $139.3 million increase in operating expenses primarily due to increases of $104.3 million in sales and marketing expenses, $19.7 million in general and administrative expenses, and $15.4 million in research and development expenses.
The increase was driven by an $88.2 million increase in revenues, partially offset by an $82.4 million increase in costs and operating expenses, primarily due to increases of $69.1 million in sales and marketing expenses and $9.5 million in cost of revenue.
We deliver guidance to consumers through educational content, tools and calculators, product marketplaces and our app. Our platform delivers unique value across many financial products, including credit cards, mortgages, insurance, SMB products, personal loans, banking, investing and student loans.
Our platform delivers unique value across many financial products, including credit cards, mortgages, insurance, SMB products, personal loans, banking, investing and student loans. We expanded our guidance to the United Kingdom (UK) with our acquisition of Know Your Money (KYM) in 2020, and expanded organically into Canada during 2021 as well as Australia during 2022.
Sales and marketing expense For 2023 and 2022, our total sales and marketing expense was comprised of approximately 51% and 45% for performance marketing, respectively, and 21% and 28% for brand marketing, respectively, with the remainder for organic and other marketing expenses. We are able to adjust our marketing spend to reflect changes in external factors and consumer behavior.
Sales and marketing expense Components of sales and marketing expense, including as a percentage of total sales and marketing expense, are as follows: (in millions) 2024 2023 2022 Year Ended December 31, $ % $ % $ % Performance marketing $ 297.4 63 % $ 206.5 51 % $ 168.4 45 % Brand marketing 68.6 15 % 84.4 21 % 106.3 28 % Organic and other marketing 104.6 22 % 110.6 28 % 100.9 27 % Total sales and marketing $ 470.6 100 % $ 401.5 100 % $ 375.6 100 % We are able to adjust our marketing spend to reflect changes in external factors and consumer behavior.
Other gains (losses), net is primarily related to changes in the fair value of the embedded derivative in our previously outstanding long-term debt, as well as realized and unrealized gains and losses on foreign currency transactions and balances. Other gains (losses), net for 2021 includes a gain on extinguishment of debt as well as a nonrecurring gain.
Other gains (losses), net is otherwise primarily related to realized and unrealized gains and losses on foreign currency transactions and balances. Income tax provision (benefit) Our income tax provision (benefit) consists of federal and state income taxes.
Removed
By operating at the intersection of consumers and financial services providers, NerdWallet drives value for both. Through our platform, our financial services partners can reach a substantial audience, comprised of 23 million Monthly Unique Users (MUUs) on average in 2023 and 20 million on average in 2022.
Added
In addition to our historical offerings, with our acquisition of Next Door Lending LLC (NDL) in October 2024, we expanded our offerings in the mortgage space to include mortgage lending services. As the financial services industry becomes more fragmented and complex, we believe the need for trustworthy and knowledgeable financial guidance increases.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeInterest Rate Risk Our cash and cash equivalents primarily consist of cash on hand and highly liquid investments in money market instruments and U.S. government securities. We had cash and cash equivalents of $100.4 million and $83.9 million as of December 31, 2023 and 2022, respectively. We do not enter into investments for trading or speculative purposes.
Biggest changeInterest Rate Risk Our cash and cash equivalents primarily consist of cash on hand and highly liquid investments in money market instruments and U.S. government securities. We had cash and cash equivalents of $66.3 million and $100.4 million as of December 31, 2024 and 2023, respectively. We do not enter into investments for trading or speculative purposes.
The effect of a hypothetical 10% change in foreign currency exchange rates applicable to our business would not have had a material impact on our historical consolidated financial statements for the years ended December 31, 2023, 2022 and 2021.
The effect of a hypothetical 10% change in foreign currency exchange rates applicable to our business would not have had a material impact on our historical consolidated financial statements for the years ended December 31, 2024, 2023 and 2022.

Other NRDS 10-K year-over-year comparisons