One last influx of money from Charlotte-based Tree.coms former business model boosted the company into profitability in the second quarter, and executives point to a second straight period of record revenue as a sign theyll grow stronger going forward.
Net income fell 72 percent from a year ago, but its almost an apples-to-oranges comparison. The company has dramatically changed since then, selling off its home lending business to Discover Financial in a $56 million deal to focus solely on lead-generation.
Banks and other lenders pay Tree.com for access to the customers who come to its site looking for a mortgage.
The company lost money in its regular operations for the quarter, but was pushed into the black by the last $10 million payment from Discover Financial in the purchase of the home loan portfolio last year.
CEO Doug Lebda said on a conference call with analysts that the company has been taking money from its record-setting revenue and plowing it back into marketing and sales expenses.
LendingTree launched a large-scale media campaign in May with two new commercials that Lebda said weighed on financial performance but has yielded excellent results so far.
The company is now preparing to position itself for the moves in the broader mortgage market. Rising mortgage rates are tamping down demand for refinances, but also make banks value Tree.coms leads more.
Lebda said the company has seen double-digit increases in their price paid per lead.
Dunn: 704-358-5235 Twitter: @andrew_dunn
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