LegalZoom Reports Loss on Higher Revenue in First Quarterly Report

Legal technology company LegalZoom.com Inc. shared its second quarter results in its first earnings call as a publicly traded company.The Glendale-based company reported a net loss of $38.4 million (-31 cents a share) for the quarter ended June 30, compared to a loss of $4 million (-3 cents) for the same quarter last year. Revenue climbed 36 percent, to $150 million.Performance was led by $73.4 million in transaction revenue, up 45 percent year-over-year.“We saw a mix shift toward business formations, which helped drive higher average order values in the period,” Chief Executive Officer Dan Wernikoff said in a conference call. “This shift is a positive signal that our efforts to reposition the LegalZoom brand are resonating with small businesses.”LegalZoom reported 1.2 million subscriptions as of June 30, with 69,000 net subscription units added in the quarter. Approximately 85 percent of LegalZoom’s subscriptions are billed upfront on annual terms, which Chief Financial Officer Noel Watson said provides a favorable working capital dynamic.Watson said that quarterly growth rates in 2021 will be impacted by the effect COVID-19 had on business formations in 2020.The company expects its revenue for next quarter to be between $143 million and $147 million. For the full year, revenue is expected to be in the range of $570 million and $578 million.“We’re pleased by our financial results in the quarter, which reflect strength across the business,” Watson said during the call. “We continue to focus on executing against our primary growth vectors, which we believe will maximize long-term shareholder value.”Shares of LegalZoom (LZ) closed Friday down 16 cents, or a fraction of a percent, to $34.84 on the Nasdaq, a market that closed up a fraction of a percent.