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Q2 Earnings Roundup: LegalZoom (NASDAQ:LZ) And The Rest Of The Online Marketplace Segment

StockStory - Fri Oct 20, 2023

LZ Cover Image

Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at LegalZoom (NASDAQ:LZ), and the best and worst performers in the online marketplace group.

Marketplaces have existed for centuries. Where once it was a main street in a small town or a mall in the suburbs, sellers benefitted from proximity to one another because they could draw customers by offering convenience and selection. Today, a myriad of online marketplaces fulfill that same role, aggregating large customer bases, which attracts commission-paying sellers, generating flywheel scale effects that feed back into further customer acquisition.

The 11 online marketplace stocks we track reported a weaker Q2; on average, revenues missed analyst consensus estimates by 0.54% while next quarter's revenue guidance was 1.72% below consensus. Tech valuation multiples have reverted to their historical means after reaching highs in early 2021, and online marketplace stocks have not been spared, with share prices down 25.6% on average, since the previous earnings results.

LegalZoom (NASDAQ:LZ)

LegalZoom (NASDAQ:LZ) is an online platform that provides online legal services to individuals and small businesses. The company’s co-founders found it difficult and expensive to find lawyers and file paperwork when trying to start a business so they started LegalZoom instead to address this pain point.

LegalZoom reported revenues of $168.9 million, up 3.04% year on year, topping analyst expectations by 1.1%. It was a mixed quarter for the company, with solid growth in its user base but slow revenue growth.

“The recent launch of LZ Books reaches across all our strategic growth pillars while solving a large gap in the market. We are setting ourselves apart as the sole online platform providing solutions for small business needs required right at the time of formation and beyond, all under one roof,” said Dan Wernikoff, LegalZoom’s Chief Executive Officer.

LegalZoom Total Revenue

The stock is down 33.2% since the results and currently trades at $10.26.

Read our full report on LegalZoom here, it's free.

Best Q2: MercadoLibre (NASDAQ:MELI)

Originally started as an online auction platform, MercadoLibre (NASDAQ:MELI) is a one-stop e-commerce marketplace and fintech platform in Latin America.

MercadoLibre reported revenues of $3.42 billion, up 31.5% year on year, outperforming analyst expectations by 4.4%. It was a very strong quarter for the company, with impressive growth in its user base and a decent beat of analysts' revenue estimates.

MercadoLibre Total Revenue

MercadoLibre scored the biggest analyst estimates beat and fastest revenue growth among its peers. The company reported 109 million daily active users, up 29.8% year on year. The stock is down 0.46% since the results and currently trades at $1,159.3.

Is now the time to buy MercadoLibre? Access our full analysis of the earnings results here, it's free.

Weakest Q2: Sea (NYSE:SE)

Founded in 2009 and a publicly-traded company since 2017, Sea (NYSE:SE) started as a gaming platform and has since expanded to offer a variety of services such as e-commerce, digital payments, and financial services across Southeast Asia.

Sea reported revenues of $3.1 billion, up 5.2% year on year, falling short of analyst expectations by 4.68%. It was a weak quarter for the company, with a decline in its user base and a miss of analysts' revenue estimates.

The stock is down 22.6% since the results and currently trades at $43.93.

Read our full analysis of Sea's results here.

Teladoc (NYSE:TDOC)

Founded to help people in rural areas get online medical consultations, Teladoc Health (NYSE:TDOC) is a telemedicine platform that facilitates remote doctor’s visits.

Teladoc reported revenues of $652.4 million, up 10.1% year on year, in line with analyst expectations. It was a mixed quarter for the company, with slow revenue growth.

The company reported 85.9 million users, up 6.58% year on year. The stock is down 18.8% since the results and currently trades at $18.5.

Read our full, actionable report on Teladoc here, it's free.

Airbnb (NASDAQ:ABNB)

Founded by Joe Gebbia and Brian Chesky by renting out a blowup bed on the floor of their San Francisco apartment, Airbnb (NASDAQ:ABNB) is the world’s largest online marketplace for lodging, primarily homestays.

Airbnb reported revenues of $2.48 billion, up 18.1% year on year, surpassing analyst expectations by 2.69%. It was a solid quarter for the company, with optimistic revenue guidance for the next quarter.

The company reported 115.1 million nights booked, up 11% year on year. The stock is down 15.3% since the results and currently trades at $119.29.

Read our full, actionable report on Airbnb here, it's free.

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The author has no position in any of the stocks mentioned