Wednesday, July 23, 2014

Angie's List's Share Price Down Sharply In After Hours Trading As Losses Mount

Angie's List has been in business for nearly two decades but has never turned a profit. Second quarter earnings reported by the company at the close of the stock market today didn't disappoint the company's many skeptics. Despite a 33% increase in revenues over the same period a year ago, the company reported losses of $18.4 million for the quarter, up from $14.3 million from the prior period last year. That's a larger than expected loss at the same time its second quarter revenues of $78.9 million was lower than expected. Net losses for the year topped $22 million, almost exactly where the company's losses stood at this point last year. The company's stock was trading down nearly 15% an hour after the markets closed, trading well below $9 a share.

Perhaps the most disturbing trend in the numbers is Angie's List's growing reliance on its revenues from service providers. Service provider revenues are growing faster than revenues from memberships sold to consumers who supposedly rate those service providers. Angie's List now relies on 77% of its revenues from service providers. In addition, its marketing costs continue to soar. The cost of signing up a new member increased from $80 a year ago to $90 for the most recent quarter according to Seeking Alpha's David Trainer. "These two numbers reinforce the fact that ANGI, which markets itself as a 'consumer driven organization' is actually beholden to service providers, and consumers recognize that fact," Trainer notes in questioning the reliability of its ratings.


Anonymous said...

How can any business exist for decades and never turn a profit? How does it pay its bills and own several blocks of downtown Indianapolis?

The fact that Angie's List now relies on 77% of its revenues from service providers, to me makes it UNRELIABLE as a consumer reporting agency.

I was defrauded by a paying service provider, and Angie's List kept extending the time to respond and then removed my negative report after the company reimbursed me for the second service call of another provider to confirm that they attempted to defraud me.

Gary R. Welsh said...

Ask Sir Mickey Maurer. He sits on their board of directors and sings the praises of its CEO. It's Fantasy Land if you ask me, but it's made Angie and Bill multi-millionaires. I don't believe it has operated much differently than your garden variety Ponzi scheme. Maybe we should rename the law school that bears Maurer's name the Mickey Mouse School of Law.

Anonymous said...


Several downgrades.


Anonymous said...

Day low is $7.77.

So far.

More ouch.

This thing has no earnings. What's to stop every investor from heading for the exits?

Anonymous said...

Let's not forget the world's worst City Councilors who helped Oesterle achieve what he did for Angie's List- some or most to the detriment of the Marion County taxpayers. Let's not forget the former Center Township Chair, his Co-Chair, and all his special interest friends involved. Let's not forget a former CCC now residing in a southern border state who was a pawn for all the pie-in-the-sky about Angie's List... But hey, what do I know? I only had a front row seat on the third floor of the Columbia Club the first Wednesday of almost every month...

Anonymous said...

Center Township? -Did 10:36 mention the corruption of Center Township?