QuinStreet, Inc. (NASDAQ:QNST) Q3 2022 Earnings Conference Call May 4, 2022 5:00 PM ET

Company Participants

Hayden Blair - IR

Douglas Valenti - CEO

Gregory Wong - CFO

Conference Call Participants

John Campbell - Stephens

Jason Kreyer - Craig-Hallum

Jim Goss - Barrington Research

Chris Sakai - Singular Research

Operator

Good day, and welcome to the QuinnStreet Third Quarter Fiscal 2022 Financial Results Conference Call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Mr. Hayden Blair, please go ahead, sir.

Hayden Blair

Thank you, Jenny. Thank you to everyone joining us as we report QuinnStreet's Third Quarter Fiscal year 2022 financial results. Joining me on the call today are Chief Executive Officer, Doug Valenti, and Chief Financial Officer, Greg Wong.

Before we begin, I would like to remind you that the following discussion will contain forward-looking statements. Forward-looking statements involve a number of risks and uncertainties that may cause actual results to differ materially from those projected by such statements and are not guarantees of future performance. Factors that may cause results to differ from our forward-looking statements are discussed in our recent SEC filings, including our most recent 8-K filing made today and our most recent 10-Q filing. Forward-looking statements are based on assumptions as of today, and the company undertakes no obligation to update these statements. Today, we will be discussing both GAAP and non-GAAP measures. Our reconciliation of GAAP to non-GAAP financial measures are included in today's earnings press release, which is available on our investor relations website at investor.quinnstreet.com. With that, I will turn the call over to Doug Valenti. Please go ahead, sir.

Douglas Valenti

Thank you, Hayden. Welcome, everyone. Increased claims costs continue to suppress insurance carrier marketing spend and in turn, revenue in our auto insurance client vertical. The good news is that those effects on our insurance clients and their business economics are transitory.

Further good news, is that revenue and our insurance client vertical appears to be at or near a bottom. Carriers are working diligently through the well-honed process of rerating or repricing their policy products to reflect the new environment. We now have a number of examples of successful client rerating where they have reestablished or increased marketing spend that had been previously paused or reduced.

That's another way the environment and insurance remains generally complicated and dynamic, but the client back out to the other side of this adjustment and transition period certainly appears to have begun. Importantly, we and carriers continue to expect strong marketing spend and consumer shopping on the other side of this rerating cycle. Carrier economics will be renewed and consumers are expected to shop aggressively in response to higher rates.