MeridianLink (MLNK) Q4 2024 earnings summary

Executive summary

• Achieved GAAP revenue of $79.4 million in Q4 2024, up 7% year-over-year, and $316.3 million for the full year, up 4% year-over-year.

• Adjusted EBITDA reached $33.4 million in Q4 (42% margin) and $130.7 million for the year (41% margin), both showing margin expansion.

• Record bookings for the second consecutive year, with best new logo quarter in two years and strong cross-sell and new logo performance.

• Continued innovation and product launches, including new Share-of-Wallet add-on, data-rich cross-sell tools, and partnerships with ScoreNavigator and Zest AI.

• Board authorized a new $129.5 million stock repurchase program, effective immediately.

Financial highlights

• Q4 subscription revenue grew 5% year-over-year, making up 82% of total revenue; services revenue grew 6%, and other revenue 40%.

• Lending software revenue grew 7% in Q4 and 7% for the year; consumer lending revenue up 9% year-over-year, mortgage lending down 7%.

• Data verification software revenue was $15.7M in Q4 and $66.9M for FY 2024, down 1% year-over-year due to a large customer downsell.

• Adjusted gross profit margin improved to 74% in Q4 and 73% for the year; Q4 non-GAAP operating margin was 22%.

• Free cash flow was $12.1 million in Q4 (15% of revenue) and $70.3 million for the year (22% of revenue).

Outlook and guidance

• 2025 GAAP revenue expected between $326 million and $334 million, representing 3%-6% growth.

• Adjusted EBITDA guidance for 2025 is $131.5 million to $137.5 million, with a margin of approximately 41%.

• Consumer lending expected to grow 7% in 2025; mortgage market to contribute about 18.5% of revenue.

• Investments in R&D and sales/marketing to increase by about 100 basis points of revenue in 2025.

• Shift to annual guidance updates, no longer providing quarterly guidance.