ANGI Homeservices Inc

Angi reported an 11% year-over-year revenue decline in the second quarter, driven by a 34% drop in network revenue as the company reduced lower-quality marketing and homeowner demand shifted toward smaller projects. The company recorded a $235 million non-cash impairment charge for goodwill and trade names but said it does not affect liquidity. Management reallocated about $6 million of TV spending to higher-return channels and remains on track for approximately $50 million in annual adjusted EBITDA less capital expenditures. Angi is expanding partnerships with larger service businesses and migrating to an AI-first platform, with its homeowner AI agent now reaching 50% of traffic and converting users at three times the rate of non-interacting traffic. CEO Jeff Kip said core-business growth could return as early as 2027 if execution succeeds, though the company did not reinstate formal guidance.

StockStory identified three small-cap stocks it keeps off its radar: Angi, Donnelley Financial Solutions, and Lake City Bank. Angi, the home-services marketplace with a $222.1 million market cap, saw service requests fall 19.2% annually and faces a forecasted revenue decline of 3.6% over the next 12 months amid intense competition. Donnelley Financial Solutions, a $930.3 million regulatory software provider, posted a 3.4% annual sales decline over five years and EPS growth of just 8.4% annually, underperforming its sector. Lake City Bank, with a $1.52 billion market cap, recorded 5.1% annual revenue growth and 3.9% annual EPS growth over five years, both below typical banking peers, while net interest income grew only 6% annually.

Gig economy stocks reported mixed first-quarter results, with aggregate revenues in line with analyst estimates but next-quarter guidance coming in 4.7% below consensus. Among the six companies tracked, Upwork posted revenue of $195.5 million, up 1.4% year-on-year and in line with expectations, but its next-quarter revenue guidance significantly missed estimates, sending its stock down 25.6% since the report. Lyft was the best performer, with revenue of $1.65 billion beating expectations by 1% and strong user growth of 16.9% to 28.3 million, though its shares traded sideways. DoorDash delivered the fastest revenue growth at 33.1% to $4.04 billion but fell short of analyst estimates by 2.8%, while Uber's revenue rose 14.5% to $13.2 billion, slightly missing expectations, and Angi's revenue declined 3.2% to $238.2 million, missing estimates by 1% and causing its stock to drop 31.6%.