Angi (ANGI) Q1 2026 Earnings Call TranscriptMay 6, 2026
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DATE
Wednesday, May 6, 2026 at 8:30 a.m. ET
CALL PARTICIPANTS
Chief Executive Officer — Jeffrey KipChief Financial Officer — Julie Hoarau
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TAKEAWAYS
Adjusted EBITDA -- $23 million, exceeding the previously communicated $10 million to $15 million range due to higher-than-anticipated engineering capitalization and one-time expense benefits.Capital Allocation -- Approximately $100 million in bonds repurchased during the quarter at nearly a 9% discount, reducing debt by about 20% since the spinoff; share repurchases are paused until 2027 due to tax-free spinoff constraints.Revenue Trends -- January and February revenue was strong, while March dropped to the low end of the guidance range, attributed to a shift from larger to smaller job categories and reduced project volume from homeowners and service professionals.Pivotal Strategic Shift -- Management disclosed discontinuation of financial guidance to prioritize aggressive investment and resource reallocation toward an "AI native technology platform" and full deployment of the Angi Pro Chief Revenue Officer product, citing "the upside of our AI native strategy is on some level, uncapped."Market Opportunity -- Management identified a $700 billion total addressable market (TAM) in residential construction and home services, with the statement that Angi's current market share is below 1.5%, and small Pro market share is 3%-4% while large Pro share is under 0.5%.Profitability Expectations -- CEO Kip referenced intent to maintain a "cash flow cushion," indicating internal funding for transformation targeting adjusted EBITDA minus CapEx of roughly $50 million per year as a directional floor rather than formal guidance.Product Roadmap -- First agent for the Angi Pro Chief Revenue Officer offering is targeted for testing within several weeks, with sequential agent rollouts and core platform transition expected over the next 12 months.AI Engagement -- Approximately 50% of homeowners are now interacting with Angi's AI helper, signaling accelerated technology adoption within the customer journey.LLM Partnerships -- Angi's app has launched successfully on ChatGPT, and integration with Amazon and other major LLM players is planned soon, with current traffic from these channels described as small but expected to expand.International Growth -- Accelerated revenue expansion in Europe is cited as an additional pathway to the $5 billion revenue goal, with European TAM estimated at $500 billion to $600 billion.
SUMMARY
Angi(NASDAQ:ANGI) presented a significant realignment in business strategy centered on an accelerated shift to AI-driven products and discontinued issuing near-term financial guidance to advance internal investment in technology transformation. The company remains self-funded, stating clear intent to deliver continued positive operating cash flow while undertaking this transition. Bond repurchases of $100 million were completed at a notable discount, reflecting a disciplined approach to capital deployment under temporarily restricted buyback activity. Management introduced a transparent product timeline for the Angi Pro Chief Revenue Officer platform, emphasizing sequential rollouts and ecosystem integration with industry-leading LLM partners. Management detailed explicit TAM segmentation by Pro type and discussed tactical levers to expand share across both small and large provider markets as well as European operations.
CEO Kip stated, "We have high visibility in our business" but justified cessation of financial guidance as "there isn't a reward for managing the quarterly or annual guidance."Julie Hoarau communicated that approximately 20% of shares outstanding were previously repurchased, constrained by spinoff-related tax limitations until April 2027.CEO Kip outlined that "software and services" address an additional $50 billion to $70 billion revenue opportunity outside the core lead marketplace, with AI transformation expected to increasingly drive value for both Angi and participating professionals.Pros' win rate on jobs remains a principal focal point, with ambition to double current conversion rates through AI-driven workflow enhancements as articulated in the strategic roadmap.
INDUSTRY GLOSSARY
LLM: Large Language Model—a generative AI system trained on vast text datasets to process and generate human-like language, used here for customer interaction and channel integration.TAM: Total Addressable Market—the total revenue opportunity available for a product or service, referenced here as the full value of residential construction and home services jobs targeted by Angi.Angi Pro Chief Revenue Officer (CRO): The company's in-development AI-driven platform providing professionals with tools to increase job win rates and manage business leads both on and off Angi's network.
Full Conference Call Transcript
Julie Hoarau: Good morning, everyone. I'm Julie Hoarau, the CFO of Angi Inc. and welcome to Angi Inc.'s first quarter earnings call. Joining me today is Jeff Kip, CEO of Angi. Angi has published a shareholder letter, which is currently available on Angi's website in the Investor Relations section. We will not be reading the shareholder letter on this call. I will soon pass it over to Jeff for a few introductory remarks and then open it up to Q&A. Before we get to that, I'd like to remind you that during this presentation, we may make certain statements that are considered forward-looking under the federal securities laws.
These forward-looking statements may include statements related to our outlook, strategy and future performance and are based on our current expectations, and on information currently available to us. Actual outcomes and results may differ materially from the future results expressed or implied in these statements, due to a number of risks and uncertainties, including those contained in our most recent quarterly report on Form 10-Q, our most recent annual report on Form 10-K and in the subsequent reports that we have filed with the SEC. The information provided on this conference call should be considered in light of such risks.
We will also discuss certain non-GAAP measures, which, as a reminder, include adjusted EBITDA, which we'll refer to today as EBITDA for simplicity during the call. I will also refer you to our earnings release, shareholder letter and public filings with the SEC and again to our Investor Relations section of our website for all comparable GAAP measures and full reconciliations for all material non-GAAP measures. Now I will pass it off to Jeff.
Jeffrey Kip: Good morning. Thank you all for taking the time to read our letter and join us today. We know everybody is busy. Just to repeat a little bit of what I wrote in the letter. We believe we're in the most -- in the middle of the most transformational time in technology in a generation. We think AI agents and agentic coding presents Angi opportunities that we did not have in the same way or fashion 12 or even a few months ago.
We believe it's incumbent upon us with good stewards of the company and its capital to move aggressively to take advantage of these opportunities, moving from our legacy platform to a new AI native technology platform for our core business in flywheel, much faster as the first building agents to multiply the effectiveness of our core customer experience and offer new capabilities to our Pro customers, what we are now calling the Angi Pro Chief Revenue Officer is the second. And finally, leveraging a agentic coding to build these agents in the platform twice as fast as we could before is the third. We have great assets.
We're confident that our existing flywheel is one of the best in the industry, if not the best. We have 30 years of brand equity. We have nearly 200,000 active [ Pros ] across North America and Europe. We have the most powerful customer acquisition engine there is in the industry. Our flywheel is going to spin even faster as we deploy agents to improve our customer success rates and serve as a phenomenal distribution base for our new product that anyone building AI software would love to have. Thus, we think we have a tremendous head start and great leverage against the opportunity.
For the last 3 years, we've been working hard quarter-by-quarter to incrementally improve our customer experience and business on an old brittle legacy stack and the resources we've been using to do this are really critical to moving forward as quickly as possible against the much greater opportunities I just described. We have made real progress on the customer experience. I won't list everything I've listed in the past. But moving NPS 30 points and improving pro churn by 30% are key markers during that period. We've also made good incremental progress moving AI into our key revenue flows with 50% of our homeowners now touching our AI helper in their path.
However, we've also not been 100% consistent at delivering incrementally with our legacy technology. The time and costs are extremely high. The incremental approach we've taken and we are taking is not enough, and it's not frankly worth the opportunity cost versus what else is in front of us. We just can't afford to keep our product development teams battling with the core technology to improve quarterly revenue and deliver against specific targets. So we're going to release our resources against the opportunities I just described.
Getting to the new AI native platform is critical because it's going to allow our core product to function more effectively and drive AI-first innovation, improve the customer experience and the efficiency of the business. far better than we can on the decades old code in our current technology is made up of. Our core flywheel is going to spin faster in our core experience on both sides of the marketplace is going to be better.
Shifting and focusing on building the new Angi Pro Chief Revenue Officer is an incredible opportunity because first, we're going to generate materially more value for our core Pro customers by making sure they win more of our leads, driving retention, engagement, multiplying lifetime value, which in turn will spike acquisition opportunity of new Pros. It's the strongest bet we can make in this business. And then secondly, we effectively will have a new business because our Pros will be able to use the Angi Pro [ CRO ] for [indiscernible] leads, the rest of their business, grow and enjoy more success, which is, of course, our core mission.
We get more jobs done well for our homeowners and more jobs done well by our Pros. So we have a twofold market opportunity and a huge as yet undisrupted market where we have the leading assets and leading market position. So multiple things can be true at the same time. Our mission has not changed. We're focused on jobs done well, as I just said, and jobs [ won ] well for our Pros. Our goal is to deliver profitable and accelerating growth over time.
And we are also making a clear pivot on how we execute our strategy, given, again, what we think is a remarkable opportunity in front of us in our space, and we think we are well positioned to win. So with that intro, we will move to questions.
Operator:[Operator Instructions]. Our first question today comes from [ Dan Kernan ] with [ StoneX ].
Unknown Analyst: Jeff, I guess the first obvious question, just to follow up on this. We're calling it a pivot, but it's really more of an enhancement the way I think you guys are trying to win business. And so with the reduction of guidance here or the pull of guidance, I guess, for the short term, maybe you can just frame for us how much this is going to impact in your mind, revenue and EBITDA and over what time frame? And then I want to kind of follow up on sort of how you perceive the market opportunity.
Jeffrey Kip: Okay. Thanks, Dan. Good to hear from you. So first, it is -- again, two things could be true. We have been going down the path. We've been going on. I think it's a material pivot in the way we deploy our resources and execute and I think it is a whole new opportunity that we are going to build as well. In terms of your question on revenue, EBITDA, cash flow, we've made a clear decision not to give guidance. We think that setting guidance and the pursuant distraction it is from executing its larger opportunity is not where we should be focused.
But what I would say is our existing business in flywheel generate and will continue to generate solid operating cash flow, which we think of as adjusted EBITDA minus our CapEx and we plan to continue to generate solid operating cash flow. We're not looking to destroy our EBITDA margins or take our cash flow anywhere near 0. We're effectively going to fund our platform and product strategy internally, meaning we're only going to add to our cost base where we see more opportunity. For example, our AI software and token costs will be several million dollars more than we anticipated either a few months ago.
But by taking resources off the legacy technology and acknowledging that we're no longer going to focus on quarterly revenue, there will be an opportunity cost measured in some amount of lower revenue implicit by not working on the core technology to deliver incremental revenue wins. But to be clear, we don't plan to use the cash on our balance sheet to fund the transformation rather, we actually anticipate continuing to build the cash on our balance sheet by continuing to produce cash flow.
Unknown Analyst: Does that -- just to be clear on that before I ask the kind of TAM question, Jeff. It's obviously not a distraction. You're aiming for a bigger target here, some revenue opportunity loss, but you're -- I mean we're still focused on the core business, and we don't anticipate -- I mean, I don't -- is there any way to kind of frame how big a disruption you think this might be to the core business in general?
Jeffrey Kip: Look, I think we plan to operate with a cash cushion. Without this being a commitment or guidance, I think we be happy with the cash flow cushion and give or take, the range of $50 million a year. That's adjusted EBITDA minus CapEx. That's not a goal of budget, a commitment or a plan or guidance, but that's directionally how we think about floor. And we think that, that's a good number that allows us to internally fund the transformation and continue to deliver cash flow to the business.
And we think that our core business will continue to generate solid profitability, we think that once it gets on to the new platform, we will have the opportunity to accelerate with innovation and efficiency there. And then I think we'll have the opportunity as we put our agents in place and get penetration over the next several quarters, we think we'll have the opportunity to accelerate materially following getting the new Angi Pro CRO infrastructure into place.
Unknown Analyst: So with that, Jeff, I think in the letter, you basically said that your -- the $700 billion TAM that you're referencing is just job value and for you guys to get to your $5 billion revenue opportunity, which you lay out there, it just seems like doubling your win rate. I mean, what you're suggesting here is that by building the CRO for Pros, I mean you have an opportunity for them to utilize this both on and off platform. So there seems like there's a software element to this. So maybe you could unpack for us how you think about getting to that $5 billion?
And separately, is there a separate TAM that we aren't discussing yet today or in the shareholder letter that could be achieved or attacked from a software perspective, given that most pro marketing budgets are viewed as percentage of job value, but software is typically a separate expenditure line and kind of viewed as sort of a separate TAM when they think about cost of service?
Jeffrey Kip: A great multipart but very smart question from you, Dan. I should expect nothing less. So yes, $700 billion TAM is residential construction, specialty construction, home services, total job value that we think is our target market for our platform and customer base. Today, we capture below 1.5%. The market is split 75% larger Pro, 10 employees or more, a 25% smaller Pro. We think we have 3% to 4% share in the smaller Pro market, and we're under 0.5% of the large Pro. We have a strong view, AI, no AI, we can replicate the share of the small Pro market in the large Pro market. We think we've underinvested and not executed well there over time.
Doing just that -- and getting to that share would give us $2.5 billion of revenue with a 10% take rate, which is about our current take rate, which is Pros pay $50 a lead, they win 1 in 7, 1 in 8. The average job is about $4,000. And so we think about it that way, I'll come back to that. On our platform, 10 homeowners submit jobs. Seven of the jobs get completed, but only 2 of those are won by our PROs. If you look at our core long-standing strongest brands and businesses in Europe, which would be the U.K., Germany and the Netherlands, they win more like 3.5.
So we believe that doubling that too is well within reach. And so Pros are winning twice as many, 4 out of the 7 instead of 2 out of the 7 that takes your share of the total job value in the market from 3% to 4% to 6% to 8% or 7% as a proxy. If you come back to the take rate, Pros are looking at their overall P&L and their share, they're paying to support their revenue. We think tend is a pretty good marker where you're driving good value.
By improving the win rate, we would lower the take rate unless we took lead pricing, taking lead pricing is one way to keep the take rate, a fair take rate, another way is charging some for the software. So you're correct. There's 2 markets there. There's the lead market where maybe we'd like to be a little less than 10, to drive real value there. But there's also the software market and based on our research and looking at -- if you take 10% of that $700 billion job value market, it's $70 billion, that's the potential revenue.
We think that there is a comparably sized market, $50 billion to $70 billion maybe, in services and software to sell the Pros that is likely growing as software transforms with AI. So on some level, there's $140 billion of revenue out there. I think our focus is on delivering against the [ 70 ] delivering for our Pros but it is a product that while we're first focused on Angi leads, our Pros should be able to use for other leads and frankly, running their overall business. So you're not wrong. And when we think about our $5 billion revenue target, one way to do it is to get 7% of the market and a 10% take rate.
Another way to do it is to get a lower percent of the market and effectively have software and services revenue. And then the third leg we have is actually accelerating growth even faster in Europe, which can be a material contributor because there's another $500 billion or $600 billion of TAM in Europe which we've been less successful at penetrating. We think that's tied a bit to market structure, and that's a different conversation. But we think we have multiple ways to get to the $5 billion. And I think you've hit you've hit well on a couple of them.
Operator: The next question comes from Youssef Squali with Truist.
Unknown Analyst: This is Robert on for Youssef. On the Q1 performance, can you just explain the levers relative to 90 days ago, which areas of the business are outperformed and how sustainable is that outperformance? And then what are you guys doing in new LOM traffic channels?
Julie Hoarau: I'll take the first question. So in terms of revenue, we had a strong like January and February. Then March pulled us to the lower end of our revenue range, driven primarily we believe by macro factors. Service request mix shifted away from larger jobs in category where we have the most extra capacity such as like roofing and HVAC and towards smaller jobs. We survey thousands of Pros and homeowners and it's clear that homeowners backed away from projects like more in March than in previous months. And as a result, like Pros reduced [ LEAP ] budget because they believe they would lean like less jobs. Meaning, overall, we had lower capacity.
On EBITDA, our EBITDA came in at about $23 million. That's above our $10 million to $15 million guidance range. There were 2 contributing factors. First, we capitalized about EUR 2 million more of engineering labor than we thought in our initial guidance. We follow our accounting policy here, and we went by the book. So it went a little bit higher. And second, we had a couple of onetime benefits on expense and some timing. And so we came out above our guidance for Q1.
Jeffrey Kip: Yes, I would again say editorially, we look at all-in adjusted EBITDA minus CapEx. So when we have these swings, you can blame Julie for following our accounting policy. But we -- given our druthers, we wouldn't capitalize it, and I don't mean to speak accounting heresy, just we think it makes things more complicated and the cash ends up in the same place. So we're just calling out that benefit. Let's talk a little bit about LLM traffic. We have been investing a fair amount in making sure that we are there for the LLM traffic. We've been buying OpenAI [indiscernible] successfully. We're near breakeven on that buy.
There's been a bunch of noise out there on it, but we're happy with it. We're in their beta test, and we know they are working on optimizing and we're confident that we're going to be able to grow value and expand there. We've launched our app successfully on ChatGPT. We'd like to see them move their app ecosystem into deeper integrations, and we're working with them on that. We're going to launch on Amazon soon. And we are live working on multiple other integrations with major players, which we expect to announce in the next couple of months.
The overall share of traffic from these sources is pretty low right now, but I think we are all seeing consumer usage shift and will increase. And we think the platforms are going to figure out how to leverage this traffic, and we'll be very interested in working with us. If you think about -- I wrote this in the letter, but if you think about our approach, our approach and our pivot is about making sure our Pros get better results. When our Pros get better results, our homeowners get better results. And when customers get better results the LLM wants their customers to go there.
And so we think that in the same way that our results on SEO once kind of one SEO when we were a home adviser at Angi's List. And we have most recently taken really leading positions in and buying on [indiscernible] social for the same reason, we think we're going to do the same here. So we're pretty excited about it. Our approach has been -- we've developed technology where we can pick up the conversation in any part of the chat with the context in the chat.
So if you were to say, "Hey, ChatGPT," or, "Hey, Claude," or whichever you're talking to, "I have water on the floor in my bathroom." We could effectively let the LLM know, and we will have let the LLM know, that we can pick up the conversation there and ask questions, which are LLM driven, but with our proprietary domain knowledge fine-tuning the LLM chat. We also can pick it up somewhere in the middle or at the end when Claude or ChatGPT, [ perplexity ] or whomever has diagnosed that, oh, you have a crack in the base of your toilet and we can say here's some Pros, Ms. or Mr. Consumer and get the job done there.
And we're already taking the same approach with our core homeowner experience. We have in test an LLM first chat that effectively mirrors this experience. It's right now a conversion deprecation, which we want to narrow before we move it broadly. We do plan to lead with this experience when we're working with partners and new traffic channels because we do believe that ultimately, where we want to be is having a full chat with a homeowner, getting whatever information they're capable of, and homeowners aren't always very good at giving the information or assessing the information and being able to provide price estimates advice information and, of course, our Pros through the experience.
And that is where we see things going, and that being beneficial to the pros on the other side as well. So that's how we're looking at it all holistically. So I hope that kind of answers your question.
Operator: The next question comes from Sergio Segura with KeyBanc.
Sergio Segura: First, I was hoping you could just provide a little bit more detail on what the Angi CRO is going to look like at the product level, any kind of required investment for that product? And just maybe a little color on why this is the right jobs to be done to focus on right now? And then secondly, relatedly, maybe how does your go-to-market strategy change with this new AI approach? And then if you could discuss any challenges or opportunities of targeting the smaller Pros that you mentioned in the letter for this product?
Jeffrey Kip: Right. So the reason this is the right job to be done right now is on a simple basis, this is, we believe, the best way to achieve our mission and deliver the best customer experience to both sides of the market. What we're trying to do is make sure that when a homeowner comes to our platform, they hire a Pro from our platform and the job gets done well, and the Pro feels like they've won a job well. Everybody is happy when that happens, customer NPS is plus 50 for retention and satisfaction jumps and the Pros pay us, and we make more money, and everybody is happy.
Our biggest gap, as I walked through earlier when I was responding to Dan is the number of jobs that are actually completed versus the number our Pros win. So to drive that North Star experience, our Pros need to win more. There's been just a dramatic change in the possibilities available to us with AI agents at a genetic coding in just the last few months.
And we have been assessing and digging in and looking at what we're doing and we believe that agents offer us the opportunity to close the loop and take that metaphorically 2 out of 7 to 4 or 5 out of 7 that I referenced earlier, and double the win rate, double the effectiveness for the homeowner double the effectiveness for every -- the Pro and really grow value in the business and the ecosystem. In terms of how we're approaching this, how it's going to look, effectively, what we're doing is starting with the core lead to close cycle. So lead received first agent would be what you might call an AI call center and booking agent.
Outbound call can be made to the homeowner, homeowner doesn't pick up outbound tech can call back in. Booking agent gets more information, confirms the needs, books into the Pros calendar, sends reminders to the homeowner and the Pro, make sure there's a rescheduling, make sure the Pro shows up and getting the booking is really the first key anchor in getting the job won. A lot of our large Pros look at booking rate as their key metric. But you can go from there and imagine that you can coach the Pro on the sale going in. You can record the visit.
I don't know if anybody uses [ granola ] for their meetings and transcribes their meetings, you do something very comparable. You can send notifications with coaching advice to close the sale during the visit, and you can also take the transcription of the call and the agent can put together a draft quote by the time the Pro gets out to her or his truck or van and is able to then dispatch a quote right away. One of the gaps in the winning process is delivery of in a timely fashion and accurately.
And once you have the quote, you have follow-up, you have checks on changes, you're closing the deal, you have asking the Pro to intervene with a visit or a call to close the deal. And you can go from there. And your imagination can take you to different places. And what we're going to do is carefully assess the needs and the opportunities to make sure the -- when the homeowner submits a service request and creates a lead for our Pro, one of our Pros is consistently winning it. And so you can imagine the ecosystem will look like that.
And in our mindset, we should have our first agent in its first test in the next several weeks. We will then -- as that gets going and we complete or genic software development life cycle, which is the platform on which you do your agent development, we will work on getting our second one out, and we're working on prototypes and we get to our Investor Day in the fall. We hope to demo this for everybody who wants to come. And look, we're pretty excited.
We think that the opportunities opened up here to really deliver value for our customers and then ultimately really accelerate the business to deliver value for more and more customers that our shareholders are incredible right now.
Operator: The next question comes from Stephen Ju with UBS.
Vanessa Fong: This is Vanessa on for Stephen. I just wanted to ask a question on the guidance. So can you add some color on what forecast item is getting more difficult for you to resend guidance on and is it more on the cost side as you build out the product?
Jeffrey Kip: So I wouldn't say that we're having difficulty forecasting. We have high visibility in our business. We pay careful attention to what we're doing. It's just very simply, we're not going to give guidance because there isn't a reward for managing the quarterly or annual guidance. There's not any reward for hitting the range on our quarters. There's not any reward for dedicating resources to getting the next million dollars in the quarter versus the next billion of value that's in front of us. And to be honest, the market is telling us that. So we're going to stop trying to invest and improve our revenue on our old platform, which is really just fighting the last war.
We believe the upside of our AI native strategy is on some level, uncapped. So we believe that anything that distracts from the tremendous prize management, engineering resources, anything that distracts from the tremendous prize we have in front of us is effectively kind of a waste of time. We still plan to run our commercial machine and drive the business back to Pro growth and ultimately revenue growth. We're just not putting a timetable on that. Our milestones that we're thinking about is we're targeting getting onto the new platform in the next 12 months or so. That's a key marker in terms of getting into a place where we can innovate and work on the core business.
And then secondly, what I was just talking about in response to Sergio's question, we're going to sequentially build test and roll out our Angi Pro Chief Revenue Officer agents. And as we get that into place and the new platform rolls out, we anticipate being able to accelerate our revenue in 2027. And now we think it should be material. Otherwise, it's not really worth playing for. So I think without giving guidance, that's how we're thinking about it. And it's not a problem on visibility or difficulty. It's simply a matter of where we're prioritizing resources. And then frankly, the feedback we're getting from the market on the value of doing that.
Operator: The next question comes from Cory Carpenter with JPMorgan.
Unknown Analyst: This is Danny [indiscernible] for Cory. For the first, Jeff, can you talk about what this pivot business strategy means for the consumer homeowner experience and how it may change? And then for the second, can you talk about the rationale for the debt repurchase in 1Q and 2Q quarter-to-date and maybe provide an updated capital allocation strategy?
Jeffrey Kip: So let me talk about the homeowner experience. I'm going to let Julie talk about our bonds, and then I'll add any color there. So I talked a little bit earlier about the development of the LLM surfaces as traffic sources and our strategy there. And that was sort of very practical how are we approaching this now? How are we working with the LLMs and how does that opportunity work? If you go a step further, what many people see right now, and you can just go back to the development of OpenClaw is really the key marker here, consumers are going to have personal agents more and more.
And those personal agents are going to be able to go out form tests for them without them necessarily interfacing with in their minds, a website. So what we have -- what we strive to do is to be the best place for a homeowner come to get their job done well. We think that the strategy we've laid out continues to be the best thing. And as I said, we think that the strategy we've laid out is the best approach to delivering signals to the LLM to make the LLMs choose us effectively get the job done, get the traffic, to demonstrate that you're going to get to drive done, get more traffic.
When you think -- when we think about personal agents, personal agents are effectively trained LLMs, trained on personal preferences. And so if we can train the LLM by delivering results to be a choice [ place ] to send homeowners, we will also train the personal agents. So what we want to do is we want to position ourselves not only to be a place where a homeowner can come and use us as their agent to get their questions answered and find their. But the homeowners personal agent will come and do that. And we think we do that by delivering jobs done well for our Pros, which means job has done well for our homeowners.
I described a little bit earlier our thinking about the homeowner experience. And when you think about what I was saying with the ability to deliver estimates based on the information the homeowner gives us, again, homeowner information is not always perfect. So it'll have to be caveated estimates. Taking photos, taken info, have an iterative conversation make requests for the homeowner for certain measurements, et cetera. You can imagine the way the interactive experience can develop and ultimately, that means the Pro has better information. We get better matching, the Pro can match the technician and the equipment that they send, and we can have a much stronger ecosystem.
And this can happen either by a homeowner coming through an LLM, coming to Angi, coming through a partner. We have several partners who deliver us traffic or, frankly, a homeowners trained personal agent. And we see the world evolving this way. And so we think the homeowner experience will evolve this way, and we need to deliver against it.
Julie Hoarau: In terms of capital allocation. As just said earlier, we're confident in our ability to produce consistent cash flows. In terms of M&A strategy, we conservative and then we capped our share repurchase ability until next year. We have repurchased about 20% of our shares outstanding at the time of the spinoff, that the limit of the set hub of tax-free [ still ] and that's for data 2 years following the spinoff, so until April 2027. So as a result, we saw that buying bond was a good use of capital. We bought about $100 million worth of bonds. So that's about 20% of the debt outstanding at an almost like 9% discount.
Jeffrey Kip: So just to follow on, we are clearly not against buying our shares at favorable prices, but we can't do that until next year. We're clearly not against buying our bonds at favorable prices. As Julie said, we just bought a bunch. We do have to be mindful of creeping tender rules and how that works. So we're not averse to doing it, but we have to -- in the same way, we have to pay attention to the structures around share repurchase. We have to pay attention to the structures around bond repurchases. And as Julie said, we are not in an aggressive mindset, we're in a disciplined mindset about M&A.
We would take a great value and a great opportunity that augments our strategy but we're not trying to go and take the cash off our balance sheet and buy brand-new things that are outside of what we've told you our core strategy is and I think that's our thinking on capital.
Operator: This concludes our question and answer session. I would like to pass the floor to Jeff.
Jeffrey Kip: Well, thanks very much. Thanks for all the questions. I think we've laid out what our thesis is here, which is there are really tremendous new opportunities in front of us that are provided to us by AI agents at agentic coding. We think we're remiss to continue to work on the old technology, which is not easy to work with, nor is it productive to keep chasing quarters and revenue guidance, et cetera.
We are incredibly excited about what's in front of us because we think we have a clear line of sight on executing against our agentic strategy, and we clearly believe that we have the strongest distribution base between our brands, our Pro network, and our acquisition machine in the industry. And we think we can spin the flywheel stand-alone. We think we can add to it by building our agents and then I think effectively, Dan pointed out, there's another market opportunity here for us as well. So we're extremely excited.
It's going to take us the next several quarters to put it all in place with the new platform and the rollout of agents but we will be talking to you over time about our progress and how we're looking at the metrics, and we're -- we just think that this is a unique opportunity and we haven't seen something like this in the last few years for Angi. So thanks again for joining us, and we will talk to you soon.
Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.
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Angi Q1 Earnings Call HighlightsMay 6, 2026
Angi logo
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Angi (NASDAQ:ANGI) executives used the company’s first-quarter 2026 earnings call to outline what CEO Jeff Kip described as a strategic pivot toward an “AI native” technology platform and a suite of AI agents intended to improve outcomes for homeowners and service professionals. The company also discussed first-quarter results, the decision to stop providing guidance, early efforts to capture traffic from large language model (LLM) platforms, and recent debt repurchases.
Management frames shift to AI-native platform and agents
Kip said Angi believes it is “in the middle of the most transformational time in technology in a generation,” arguing that AI agents and “agentic coding” create opportunities that were not available “12 or even a few months ago.” He said the company plans to move “aggressively” and reallocate resources away from incremental improvements on its legacy technology stack.
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He outlined three priorities: moving the core business from Angi’s “old, brittle legacy stack” to a new AI-native platform; building agents to “multiply the effectiveness” of the customer experience, including what the company is calling the “Angi Pro Chief Revenue Officer”; and leveraging agentic coding to build both the platform and agents faster.
Kip cited assets he believes give the company leverage, including “30 years of brand equity,” “nearly 200,000 active pros across North America and Europe,” and what he called the industry’s “most powerful customer acquisition engine.” He also pointed to operational progress over the last three years, including improving Net Promoter Score by “30 points” and reducing pro churn by “30%.” Kip added that “50% of our homeowners now [touch] our AI helper in their path.”
Guidance withdrawn; focus shifts from quarterly targets
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In response to analyst questions, Kip reiterated that Angi chose not to provide guidance. He said the company does not view setting guidance as beneficial and sees it as a distraction from building what he characterized as a larger long-term opportunity. “We’re not gonna give guidance because there isn’t a reward for managing to quarterly or annual guidance,” he said.
While not providing guidance, Kip said Angi expects its existing business to continue producing “solid operating cash flow,” which he defined as adjusted EBITDA minus capital expenditures. He emphasized the company is not planning to use its balance sheet cash to fund the transformation and instead anticipates “continuing to build the cash on our balance sheet by continuing to produce cash flow.”
Story Continues
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Kip also offered directional commentary on a cash flow “cushion,” saying the company would be “happy with” something in the range of “$50 million a year” (adjusted EBITDA minus CapEx), while stressing that it was “not a goal, a budget, a commitment, or a plan or guidance.”
As for timing, Kip said the company is “targeting getting onto the new platform in the next 12 months or so,” and anticipates it may be able to “accelerate our revenue in 2027” as the new platform and agents roll out.
Q1 performance: revenue mix shift and EBITDA above prior range
On first-quarter performance, Kip said revenue was stronger in January and February, but March pushed results “to the lower end of our revenue range,” which he attributed primarily to macro factors and a mix shift toward smaller jobs. He said service request mix moved away from larger-job categories “where we have the most extra capacity,” such as roofing and HVAC, and toward smaller jobs. Kip added that Angi’s surveys of pros and homeowners indicated homeowners “backed away from projects” more in March, leading pros to reduce lead budgets because they expected to land fewer jobs.
CFO Julie Hoarau said adjusted EBITDA for the quarter was about “$23 million,” above the company’s prior guidance range of “$10 million-$15 million.” She cited two main factors: Angi “capitalized about $2 million more of engineering labor” than expected under its accounting policy, and the company saw “a couple one-time benefits and expense and some timing.” Kip added that management tends to focus on adjusted EBITDA minus CapEx and noted that capitalization swings do not change cash outcomes.
Angi Pro “Chief Revenue Officer” concept: improving lead-to-close
Kip positioned the Angi Pro Chief Revenue Officer initiative as a way to increase the percentage of homeowner jobs that are ultimately won by Angi’s pros. He described a gap in current marketplace outcomes: out of 10 homeowner job submissions, Angi sees about seven jobs completed, but “only 2 of those are won by our pros.” He said Angi’s stronger European brands win “more like 3.5,” and management believes “doubling that 2 is well within reach.”
In response to a question about total addressable market and long-term revenue goals, Kip reiterated that Angi references a “$700 billion” TAM based on total job value in residential construction and home services. He said Angi currently captures “below 1.5%” of that market, with “3%-4% share” among smaller pros and “under 0.5%” among larger pros. He suggested that replicating small-pro share in the larger-pro segment could drive a revenue opportunity, and also described how improving win rates could impact take rates.
When asked about the product itself, Kip provided a lead-to-close example of how agents could work, starting with an “AI call center and booking agent” that would contact homeowners, gather information, book appointments into a pro’s calendar, and manage reminders and rescheduling. He also described potential tools to help pros during the sales process, including recording and transcribing visits, coaching prompts, faster quote generation, and automated follow-up to improve quote delivery and closing rates. Kip said Angi’s “first agent” could be in its “first test” in the “next several weeks,” with additional agents developed sequentially. He said the company hopes to demonstrate the product at an investor day in the fall.
Kip also addressed the possibility of monetization beyond lead fees, acknowledging that there may be both a “lead market” and a “software market.” He said Angi’s research suggests that in addition to the $70 billion implied by a 10% take of the $700 billion job market, there may be a “comparably sized market” of “$50 billion-$70 billion maybe” in software and services sold to pros.
LLM traffic channels and capital allocation updates
Kip said Angi has been investing to be present on emerging LLM-driven traffic channels. He said the company has been “buying OpenAI ads successfully” and is “near break even on that buy,” and added that Angi is in OpenAI’s beta testing as OpenAI works on optimization. Kip also said Angi launched an app on ChatGPT and is working toward deeper integrations. He said Angi expects to launch on Amazon soon and is working on “multiple other integrations with major players,” which it expects to announce “in the next 2 months.” He noted that traffic from these sources remains “pretty low right now,” but management expects it to increase as consumer usage shifts.
On capital allocation, Hoarau said Angi is conservative on M&A and that the company has “capped our share repurchase ability until next year” due to limitations tied to the tax-free spin. She said Angi has repurchased about “20%” of shares outstanding at the time of the spin-off, which represents the safe harbor limit for a two-year period lasting until April 2027. Given that constraint, Hoarau said Angi viewed bond repurchases as an attractive use of capital, buying about “$100 million worth of bonds,” roughly “20% of the debt outstanding,” at an “almost, like, 9% discount.”
Kip said the company is not opposed to repurchasing shares or bonds at favorable prices but must remain mindful of “creeping tender” rules for debt repurchases and the structural limitations on buybacks until next year. He added that Angi remains disciplined on M&A and is not looking to deploy cash into deals outside its stated strategy.
About Angi (NASDAQ:ANGI)
Angi (NASDAQ: ANGI) operates a digital marketplace that connects homeowners and renters with service professionals for home improvement, maintenance and repair projects. Through its flagship platform, Angi provides user-friendly tools that allow consumers to research service providers, compare prices, read verified reviews and book appointments. The company's services span a wide range of home needs, including plumbing, electrical work, landscaping, painting, cleaning, remodeling and general handyman tasks.
Originally founded in 1995 as Angie's List, the company built its reputation on a subscription-based model and a comprehensive database of customer reviews.
The article "Angi Q1 Earnings Call Highlights" was originally published by MarketBeat.
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