IAC NASDAQ: IAC used its first-quarter 2026 earnings call to outline a simplified corporate structure and a sharper focus on two primary assets: People Inc. and its stake in MGM Resorts. Christopher Halpin, IAC’s COO and CFO, was joined by Chairman and Senior Executive Barry Diller, People Inc. CEO Neil Vogel, and People Inc. CFO Tim Quinn, who discussed operating trends at People Inc., capital allocation priorities, and a consolidation plan intended to reduce overlapping corporate costs.
People Inc. posts digital growth and margin expansion
Vogel said People Inc. delivered “a very solid quarter,” with 8% digital revenue growth, marking its 10th consecutive quarter of growth. He added that digital adjusted EBITDA margins expanded to 20% from 18% in the year-ago period.
Vogel emphasized that People Inc.’s performance was supported by a diversified audience and revenue mix and an increasing shift toward “off-platform audiences.” On slide six, he said core web sessions remain challenged and Google Search traffic “declined as expected,” with the company expecting that trend to continue. However, he noted that off-platform audiences grew 27% in the quarter across channels including Apple News, TikTok, Instagram, YouTube, and syndication partners.
He also highlighted growth in “non-sessions-based” revenue, which he said increased 24% year-over-year and rose to 41% of digital revenue from 35% a year earlier. Vogel attributed that performance to D/Cipher, social and custom ad programs, Apple News, and licensing—specifically mentioning the addition of a Meta deal.
Product launches and “inversion projects” expand beyond publishing
Vogel said People Inc. continued investing in new products and services, including what the company calls “inversion projects”—businesses built from its brands that “extend and transcend traditional publishing models.” He cited traction in MyRecipes and its Recipe Locker tool, the People app, and InStyle’s social series “The Intern” and “The Boss.”
Among the metrics shared on the call:
- Recipe Locker has 3.5 million registered users and 40 million recipes saved, according to Vogel.
- The People app reached 430,000 users since the prior call, and Vogel said app visits are about three times as long as web visits, with games driving roughly 20-minute visits.
- InStyle’s “The Intern” generated 45 million views across episodes over about a year, with sponsorship revenue attached to seasons of content, management said.
Vogel said the company expects to roll out in the second quarter a membership club for Southern Living “super fans,” with plans to follow with a similar program for Food & Wine. He also described an upcoming “social shopping tool” based on learnings from the company’s commerce business.
Diller and Vogel discussed additional brand extensions under Southern Living, including a “Southern Living Sweet Tea” product and a business selling architectural plans for Southern-style houses. Diller also raised the possibility of developing a branded “Southern Living” housing community, describing these as examples of initiatives that could become standalone businesses.
People Inc. financial update, segment reporting change, and guidance
Quinn said People Inc. generated “really solid and predictable free cash flow of almost $50 million in the quarter,” and said the company remained on track to exceed $150 million in free cash flow for the year. He noted net debt of about $1.1 billion and said the company felt good about its balance sheet and ability to deleverage.
Quinn also said print EBITDA declined as expected and reiterated the expectation that full-year print EBITDA will cover People Inc. overhead, “excluding the estimated $15 million of Google litigation expense.”
On segment reporting, Quinn said People Inc. reclassified a legacy media agency business called M&I from print to digital because it now operates under the D/Cipher team. He said the move creates opportunities to distribute D/Cipher through independent agencies and political advertisers and to improve product performance and margins. Quinn added that People Inc. historically has not run political ads on its branded properties, but can target political ads on third-party sites using D/Cipher.
The reclassification created “about a 200 basis points drag” on reported Q1 digital revenue growth, Quinn said, noting growth would have been 10% rather than 8% absent the change. Still, he said guidance was unchanged, reiterating expectations for mid- to high-single-digit digital revenue growth and total company adjusted EBITDA of $310 million to $340 million.
IAC simplification: Care.com sale, Search shutdown, and rebrand plan
Halpin said IAC completed the sale of Care.com in March, generating $296 million in net proceeds, and noted Care.com is now classified as a discontinued operation in the consolidated financials. He suggested that this accounting shift contributed to confusion in market reactions to IAC’s reported results and guidance.
Halpin also said IAC shut down its Search segment operations in April after Google notified the company it would not renew its search contract under the existing terms. After negotiations, IAC determined it could not “confidently operate the business profitably” under the new terms. The shutdown resulted in $7 million in costs tied to severance and the write-off of prepaid software. Search will be classified as a discontinued operation starting in the second quarter.
Separately, Halpin said IAC sold an unutilized domain name for $7.5 million and will evaluate monetizing other domains, including Ask.com.
Halpin also detailed a consolidation of corporate functions tied to IAC’s planned rebrand as People Inc. He said that with People Inc. as the primary operating business and MGM Resorts as the other major asset, “two layers of corporate expense” no longer make sense. The company expects the transition to run through February 2027, with projected annual run-rate savings of $40 million in operating expenses and $20 million to $25 million less in stock-based compensation. One-time expenses are expected to total $63 million (including $15 million in cash severance and related expenses, and $48 million in stock-based compensation expense).
Halpin said he and Chief Legal Officer Kendall Handler plan to leave in mid-August after the second-quarter filing, remaining as advisors through March 2027. He added the company expects Vogel to become CEO of the parent company (newly renamed People Inc.) and Quinn to become CFO around the same mid-August timeframe.
Capital allocation: buybacks, MGM, and potential dividend
Halpin said IAC repurchased 2.9 million shares for $111 million since the prior earnings call, bringing total repurchases to 13% of IAC shares since the beginning of 2025. He also said IAC purchased an additional 1 million shares of MGM for $37 million, lifting IAC’s ownership to 26%.
Diller said the company intends to continue opportunistically buying back shares and investing in MGM. He also addressed questions about dividends, saying, “I hope, as we build up cash, I think we should be a dividend-paying operation,” adding that he would “expect that to happen in the future.” On M&A, Diller said the company is “not that anymore,” noting IAC is collapsing a previously large M&A group into a “very small” one and expects investments to be primarily inside People’s operations.
On MGM, Diller said he views its prospects as “outstanding,” pointing to a large resort project in Japan that he described as a $12 billion development expected to open around 2029 or 2030. He also commented on Las Vegas demand cycles and mentioned reduced visitation from Canada as a current headwind, attributing it to U.S. policies and other one-time factors.
On Turo, Halpin said the company returned to double-digit revenue growth in the first quarter, led by volume increases, after experiencing a slowdown following the pandemic. Diller said he previously leaned toward selling the stake but described the business as “now performing very well,” adding that unless a buyer “throws a big old brick on our table,” IAC would keep the interest as it grows and potentially see it go public or be acquired later.
In closing comments, Diller and Halpin returned to concerns about market misunderstanding following the Care.com discontinued-operations presentation, with Diller saying he hoped the company could “straighten out these numbers” so that the quarter would not be “misinterpreted as something other than” a strong period.
About IAC NASDAQ: IAC
IAC NASDAQ: IAC is a publicly traded holding company headquartered in New York City that builds and invests in consumer-focused internet businesses. Through its portfolio of digital media brands, online marketplaces and subscription services, IAC delivers content and connections across a range of verticals, including lifestyle, finance, home services and personal care. The company's operations span North America and parts of Europe, where its brands reach millions of visitors each month.
In the digital publishing space, IAC's Dotdash Meredith division develops original content and data‐driven journalism across more than a dozen specialty sites.
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