IAC (IAC) J.P. Morgan 54th Annual Global Technology, Media and Communications Conference summary

Strategic transformation and corporate restructuring

• Transitioning from a holding company to People Inc., consolidating corporate functions and selling non-core assets, including Care and winding down the search business.

• Focused on two primary assets: People Inc. as a digital media leader and a 26% equity stake in MGM, with plans to keep both together for now.

• Ongoing liquidation of non-core assets like Turo and Vivian, with sales timed opportunistically based on market conditions and asset performance.

• Capital allocation priorities are now focused on share buybacks, increasing MGM ownership, and selective M&A through People Inc.

• Clearer, more disciplined capital allocation strategy, moving away from broad M&A activity.

Business model evolution and growth strategies

• People Inc. is the largest U.S. publisher, with 70% of revenue and 90% of profitability from digital media.

• Non-session-based revenue (off-platform) is the fastest-growing segment, including content on Apple News, Instagram, TikTok, and AI licensing.

• D/Cipher, a proprietary ad targeting tool, extends premium ad performance off-platform and is expected to add 100 basis points to growth in the second half of the year.

• AI licensing deals (e.g., with OpenAI and Microsoft) are high-margin and expected to become a meaningful growth driver as the industry shifts to pay-per-use and all-you-can-eat models.

• The "inversion" strategy focuses on building new business models and products, such as MyRecipes, to create durable, brand-driven revenue streams beyond traditional digital and print.

Financial performance and margin outlook

• Digital margins improved by 200 basis points year-over-year in Q1, with strong performance expected to continue.

• Non-session-based revenue streams, including content licensing and D/Cipher, have attractive, high-margin profiles.

• Investments in new initiatives are disciplined, using existing assets to seed projects before scaling, ensuring continued margin strength.