LegalZoom.com (LZ) investor relations material

Strategic progress and business transformation

• Achieved business stability and re-accelerated subscription and top-line growth, both organically and via accretive M&A.

• Shifted focus from macroeconomic dependencies to operational levers, enabling resilience against external pressures.

• Diversified away from free and low-quality customer segments, repositioning as a premium brand and targeting higher-value customers.

• Expanded serviceable markets by targeting both new and existing businesses, and broadening offerings from DIY to Do-It-For-Me services.

• Integrated Formation Nation acquisition, enhancing segmentation and providing a high-touch sales force, with further cross-sell and upsell planned.

Market environment and customer trends

• Small business formation remains robust and countercyclical, with secular tailwinds supporting growth.

• Focused on quality share and premium positioning, targeting serious business starters rather than fringe or hobbyist customers.

• Customer funnel evolved significantly, with less reliance on Google search and more on brand, AI, affiliates, and partnerships.

• Enhanced ability to serve established businesses, opening new addressable markets through products like Compliance Concierge.

Financial performance and outlook

• ARPU and retention are both improving, with a focus on optimizing LTV rather than just ARPU peaks.

• Bundling and commercialization changes have shifted ARPU mix, but individual product pricing remains strong.

• Confident in achieving double-digit top-line growth and margin expansion, with EBITDA growth expected to outpace revenue.

• Strong free cash flow and cash position support ongoing share repurchases and opportunistic M&A, with a healthy acquisition pipeline.