렌딩트리(TREE) 2026년 3분기 실적발표 전화회의: 보험 부문 성장, 14% EBITDA 전망

렌딩트리(LendingTree, Inc., NASDAQ: TREE)는 모기지 시장의 지속적인 역풍에도 불구하고 보험 부문의 성장과 소상공인 대출 개선에 힘입어 2026년 3분기 실적이 자체 전망치를 상회했다고 발표했다. 회사는 올해 전체 조정 EBITDA 성장률 전망치를 중간값 기준 14%로 상향 조정했다.

핵심 요약

• 2026년 전체 실적 전망은 중간값 기준 14%의 조정 EBITDA 성장을 가정하며, 비용은 약 3% 증가할 것으로 예상된다.
• 3분기까지의 직전 12개월 잉여현금흐름은 소송 관련 지급금을 제외하고 1억 달러를 기록했다.
• 렌딩트리는 이번 분기 동안 6,000만 달러의 부채를 상환하여 총부채를 전 분기 3억 9,700만 달러에서 3억 3,600만 달러로 줄였다. 장기 총부채 목표는 2억 달러다.
• 보험은 가장 견조한 사업 부문으로 남아있으며, 보험사의 수익성, 경쟁적인 고객 유치 예산, 렌딩트리의 최대 고객사와 진행한 예상보다 빠른 입찰 플랫폼 도입 등의 수혜를 입었다.
• 소상공인 대출은 2분기 저점에서 반등했다. 대출 수수료율(take rate)과 평균 대출 규모는 이전 최고치에 미치지 못했지만, 9월과 10월은 2026년 1월 이후 가장 강력한 SMB 컨시어지 매출을 기록한 달이었다.
• 경영진은 회사의 잉여현금흐름 창출 능력을 바탕으로 부채 상환을 계속하는 한편 4분기에 자사주 매입을 추진할 계획이다.

주요 재무 데이터

9,900만 달러의 영업권 손상은 9월 30일 무렵의 렌딩트리 시가총액을 고려한 손상 검사를 반영한 것이다. 경영진은 이 비용 계상이 주택 또는 소비자 부문에 대한 회사의 전망 변화를 의미하지는 않는다고 밝혔다.

사업 및 운영 실적

보험

손해 및 손상 보험(P&C)은 렌딩트리의 주된 성장 동력으로 유지되었다. 경영진은 산업 주기가 안정적이고 수익성이 높으며, 여러 고객사가 플랫폼상에서 빠르게 확장하고 있다고 설명했다.

렌딩트리의 최대 보험 고객사를 위한 신규 입찰 플랫폼이 예상보다 빠르게 도입되어 이번 분기 실적에 기여했다. 경영진은 재개되는 인플레이션이나 보험사의 소비자 가격 대폭 인하와 같은 주요 변수가 없다면 우호적인 보험 환경이 2027년, 2028년 및 그 이후까지 이어질 것으로 예상하고 있다.

렌딩트리는 보험 온라인 성과형 마케팅에서 자사의 점유율이 20%를 크게 밑도는 것으로 추정하고 있어, 광범위한 시장 확장에 따라 점유율을 확대할 여지가 충분하다고 보고 있다.

소비자 및 소상공인 대출

소상공인 대출은 2분기에 저점을 찍은 후 전분기 대비 강한 회복세를 보였다. 대출 실적이 안정적으로 유지되면서 대출 기관의 심리가 회복되었고, 대출 기관들은 1년 전과 유사한 금리와 조건으로 대출 제공을 재개했다.

가맹점 수요는 더 더디게 회복되었다. 대출 승인율과 평균 대출 규모는 2025년 4분기 및 2026년 1분기에 기록한 사상 최고치 이하에 머물러 있어, 중소기업들의 지속적인 신중함을 반영하고 있다.

경영진은 SMB 부문이 회사의 당초 예산대로 실적을 냈다면 연간 조정 EBITDA가 1억 6,000만 달러를 초과했을 것이라고 밝혔다. 신용 공급의 원활함, 양호한 대출 실적, 낮은 실업률에 힘입어 개인 대출 및 기타 소비자 대출 부문은 건전성을 유지했다.

주택

주택(Home) 부문은 장기 금리 상승과 어려운 모기지 시장 여건에도 불구하고 매출과 가변 마케팅 달러(VMD) 모두에서 전년 동기 대비 성장을 기록했다. 경영진은 렌딩트리가 시장 점유율을 확대하고 있으며 소비자 트래픽 투자 효과를 보고 있다고 판단하고 있다.

주택담보대출 및 주택담보 신용대출(HELOC)이 해당 부문에서 차지하는 비중이 커졌다. 경영진은 이러한 상품들이 구매용 모기지나 재융자보다 금리 민감도가 낮다고 보고 있으며, 주택 지분(Home Equity) 기반 상품이 2027년으로 들어서면서 주요 성장 기회가 될 것으로 기대하고 있다.

경영진은 정상화된 경기 중간 주기에서의 주택 부문 이익이 현재 수준보다 약 5,000만 달러 많은 VMD를 창출할 수 있으며, 그 증가분의 대부분이 EBITDA로 연결될 것으로 추산했다. 다만 회사는 모기지 환경이 언제 회복될지 예측할 수 없다고 덧붙였다.

AI 및 노스스타 전략

렌딩트리는 재방문 고객, 추천 및 로그인 사용자 성장을 지속적으로 최우선 과제로 두고 있다. 제품 개발에는 부채 관리 도구, AI 생성 추천, 시나리오 분석, 음성 및 텍스트 AI, 자동 쇼핑 지원 등이 포함된다.

AI 제안 개요 기능은 로그인 사용자 대상에서 모든 LendingTree.com 브랜드 사용자 전체로 확대되었다. 회사는 2027년 초까지 모든 소비자 제품에 AI 개요를 도입할 계획이다.

경영진은 또한 소셜 미디어, 사업 개발, 퍼블리셔 및 광고 기술에 더 많은 투자를 할 계획이다. 이는 경쟁사에 비해 렌딩트리의 입지가 다소 미흡하다고 판단하는 분야다.

렌딩트리는 700개 이상의 보험사 및 대출 기관으로 구성된 네트워크를 구조적 강점으로 보고 있다. 이들 파트너의 약 절반에서 4분의 3은 공개 온라인 견적이 아닌 백엔드 API 접속을 통해서만 견적을 제공하므로, 범용 AI 에이전트가 회사의 비교 마켓플레이스를 복제하는 데 한계가 있다.

경영진 가이던스

2026년 전체 가이던스는 중간값 기준 14%의 조정 EBITDA 성장을 가정한다. 경영진은 운영 규율과 AI 기반 생산성에 힘입어 비용 증가율이 약 3% 수준일 것으로 예상한다.

4분기 주택 부문은 계절적 감소가 예상되며, 모기지 환경으로 인해 약세가 일반적인 계절적 수준을 넘어설 가능성이 있다. 소비자 부문은 계절적으로 강화된 SMB 활동이 개인 대출의 계절적 약세를 상쇄하면서 전분기 대비 거의 보합세를 보일 것으로 예상된다.

보험 부문은 4분기 불확실성의 가장 큰 요인이다. 가이던스에는 보험사 예산의 계절적 증가가 반영되어 있지만, 최근 몇 년 동안 받았던 이례적으로 큰 연말 예산은 포함되지 않았다.

회사는 2027년 계획 수립 단계에 있으며 구체적인 숫자 가이던스를 제공하지 않았다. 경영진은 우호적인 보험 여건, 주택 부문의 주택 지분 주도 성장, 가맹점 심리 회복 시 추가적인 SMB 개선을 기대하고 있다. AI 투자가 증가할 수 있으나, 경영진은 생산성 향상을 통해 지출의 일부를 상쇄할 수 있을 것으로 예상한다.

위험 및 중점 분야

• 장기 금리 상승과 주택 거래 침체가 모기지 수요를 계속 제약하고 있다.
• SMB 가맹점 심리가 완전히 회복되지 않아 대출 수수료율과 평균 대출 규모가 이전 최고치 수준을 밑돌고 있다.
• 4분기 보험 실적은 보험사 예산의 집행 시기와 규모에 부분적으로 의존한다.
• 인플레이션 재상승이나 보험료 인하는 보험사의 수익성과 고객 유치 지출을 약화시킬 수 있다.
• 렌딩트리는 AI, 데이터 인프라 및 고객 유치에 대한 추가 투자를 계획하고 있어 2027년 비용 궤적에 대한 불확실성을 유발한다.
• 경영진은 LLM 플랫폼이 단기 또는 중기적으로 심각한 트래픽 손실을 일으킬 것으로 예상하지 않지만, 연동 및 에이전트 간 통신 프로토콜에 대한 투자를 지속하고 있다.

분석가 Q&A 하이라이트

분석가들은 보험 성장의 지속 가능성, SMB 회복 속도, AI 투자 요구 사항 및 자본 배분에 집중했다.

경영진은 보험사의 수익성과 고객 트래픽 확보 경쟁이 높은 수준을 유지하고 있어 보험 시장이 이례적으로 강력한 다년간의 가시성을 제공한다고 밝혔다. 또한 렌딩트리는 온라인 보험 성과형 마케팅 내 점유율을 높일 기회가 있다고 보고 있다.

SMB와 관련해 경영진은 지정학적 우려와 연료 가격 상승 속에서 대출 기관과 가맹점의 신중한 태도가 2분기 약세의 원인이었다고 설명했다. 대출 기관의 수요는 이후 회복되었으나, 가맹점 신뢰도, 대출 승인율, 평균 대출 규모는 여전히 최고 수준을 밑돌고 있다.

AI와 관련해 회사는 주요 LLM 및 AI 플랫폼과 활발히 협력하고 있다. 외부 AI 에이전트가 렌딩트리의 전용 에이전트와 통신할 수 있도록 인프라를 구축하고 있으며, 보험사들은 공개 웹사이트보다는 인증된 로그인 환경 내에서 요율을 제공하려는 더 큰 의향을 보였다.

자본 배분과 관련해 경영진은 레버리지 감소와 소송을 제외한 직전 12개월 잉여현금흐름 1억 달러의 조합이 지속적인 부채 상환과 4분기 시작되는 자사주 매입을 모두 뒷받침한다고 밝혔다.

실적 발표 컨퍼런스 콜 전문

전체 실적 발표 컨퍼런스 콜 녹취록

경영진 발표

Operator

Good day, and thank you for standing by. Welcome to LendingTree, Inc.'s Third Quarter 2026 Earnings Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your first speaker today, Andrew Wessel, Head of Investor Relations. Please go ahead.

Andrew Wessel

Thank you, James. Hello to everyone joining us on the call to discuss our third quarter 2026 financial results. On with us are Scott Peyree, President and CEO; and Jason Bengel, CFO.

This afternoon, we posted a detailed letter to shareholders and our investor presentation on our Investor Relations website. For the purposes of today's discussion, we'll assume that listeners have gone through those materials, and we'll focus on Q&A.

Before I hand the call over to Scott for his remarks, I remind everyone that during this call, we may discuss our expectations for future performance. Any forward-looking statements that we make are subject to risks and uncertainties, and our actual results could differ materially from the views expressed today. Many but not all of those risks we face are described in our periodic reports filed with the SEC. We will also discuss a variety of non-GAAP measures on the call, and I refer you to today's press release and shareholder letter, both available on our website for the comparable GAAP definitions and full reconciliations of non-GAAP measures to GAAP.

And with that, Scott, please go ahead.

Scott Peyree

Thank you, Andrew. Jason and I have a few opening comments before we get into Q&A. First off, we're very excited to provide strong financial results in Q3 that handily beat guidance we put out as well as our updated guidance for the full year assumes adjusted EBITDA growth by 14% at the midpoint despite ongoing headwinds in the mortgage business. This result highlights the durability of our diversified business model.

To hit very briefly on each of our main businesses, starting with insurance. The property and casualty industry cycle remains steady and very strong. We have multiple clients growing very quickly with us. The new bidding platform with our largest client that we were integrating with at the end of Q2 and beginning of Q3 went very well and rolled out faster than we fully expected to and provide a benefit to our business there throughout the quarter, the remainder of the quarter.

On the consumer side, as we expected and communicated in the Q2 earnings call, Q2 was a trough in the performance of the small business lending, and we did see strong sequential growth. We're still on the path to getting back to our all-time records of Q4 of last year and Q1 of this year, but we're feeling that the industry is in a much better position, and we are tracking to continued growth. As a matter of fact, September and October were our 2 best SMB concierge sales month since January of this year. So we definitely think it's heading in the right trajectory.

Just on the consumer lending side, in general, we're seeing strong -- from a client perspective, we're seeing strong lender performance. Credit availability remains very strong. Loan performance remains good. Unemployment rate, which is a big leading indicator a lot of the lenders look at remains very low. So personal loans and the other consumer lending areas remain in a strong and healthy place.

On the Home side, long-term interest rates and overall have definitely gone in the wrong direction this year, which has provided some headwinds. That said, even in those headwinds, we provided strong year-over-year growth in both revenue and VMD. So we're very proud of that. We feel like we're taking market share there. We feel like a number of the investments there we've done to grow consumer traffic have been effective. There still is very strong demand from clients in that space. It's really a matter of finding those qualified consumers that are looking for the loans. But as we mentioned in the letter, home equity has become and HELOC has become a major part of that business, and that business is much less interest rate sensitive and purchase or refinance mortgage. And so we believe heading into next year, we can continue to see growth in the home equity side of that business.

On the North Star strategy, execution continued and stayed strong. Just to remind everyone, we have -- our big focus is on return customers, referred customers and logged-in user growth. On the logged-in user side, we've been building and rolling out a number of tools we're excited about, debt management tools, AI-driven recommendations, scenario tools analysis. We're really looking forward to some of the things we'll be rolling out over the next few quarters, and we've got a long list of features that we think will create a very sticky log-in user base over the long run that will provide return consumers that we can proactively provide our financial and insurance product offering to without paying for those consumers to come through every time.

On just the consumer experience, the shopping experience, the [ Susie ] experience, as we call it internally, which is just to transform and dramatically improve the [ Susie ] experience. We're very happy with improvements we're making there. For example, voice and text AI, we continue to roll out in beta form on multiple fronts where we're bringing AI in to handle a lot of the shopping process on behalf of the consumer until they're closer to application-ready process before we hand them off to the client. We're seeing lots of positive signs on multiple fronts there, really looking to more rapidly and aggressively roll that out as we head into '27.

AI overviews that we're providing mainly to our personal loans customers right now. We've rolled it out from just our log-in users to now all of our branded LendingTree.com users. We're looking to roll out new versions of it for personal loans that are even better and improved on helping when you're sitting on 30 to 50 offers, helping to understand which offer you should select based off of your personal situation. We're seeing a lot of engagement from the consumers there. Our plan is as we get into '27 is to early in '27 to have versions of AI overviews for every product we're offering to the consumers coming through our website.

Moving on, just to hit briefly on -- there's been a lot of conversations that I've had. I'm sure questions will come up here. So I'll just preemptively talk about a little bit, just the AI threat, mainly the LLM threat to our business and our competitors' business versus maybe the reality we're all seeing right now. And I'll start with we have -- as we've looked at it and all the consumers out there, we have the ability to generate way higher increases in traffic through social business development and publishers then we have the threat of losing traffic to LLMs for any in the near or midterm. As we look at the marketplaces out there, there's just -- we're under-indexed in a lot of those categories. We've had a lot of success this year growing those categories. We're going -- we're actively investing heavier to grow at a faster rate in those categories.

And then when you look at the LLMs, I mean, they have been growing. They're taking bigger share. But an analysis I was given a few months ago, if you really look at the overall bucket and if you include search with LLMs is just like a pie of consumers, all of the LLMs added up together are 5% of the search bucket. And as we've seen, like which gets a lot of media, like when new items come out like news, what we're seeing is they're taking share away from the other LLM much more so than they're taking share away from like a Google AI overview search result.

So it's still growing. We're still actively involved. We've got a lot of resources commit to it, whether it's like we're building apps for the LLMs, whether we're making our content available for LLMs to access, whether we're advertising on the LLMs. But I think it's just fair to set the precedent that we don't expect any sort of massive growth in traffic from the LLMs anytime in the near future, nor do we expect any major loss of traffic we're getting from other sources to the LLMs anytime in the near future. And we're excited about the growth we know we can achieve from other areas where consumers are every day in shopping for products that we're offering.

To add to that, LendingTree's carrier and lender network is a big structural moat. We have 700-plus carriers and lenders in our network. Roughly half to 3/4 of these only quote via back-end API access, not open online quoting. So this whole concept of an LLM agent just going and filling out forms on behalf of the consumer, yes, that's true to some extent, but it's very limited in most of the industries we're in, where they can actually get a very good and quality set of comparison quotes. That's where we provide huge advantage. We feel that we can be an extremely useful platform in this world, not just from the breadth of offerings, but also from a compute standpoint with the agents to be a go-to source for the financial product quoting via AI agents.

For example, why would an LLM agent [ use ] burn compute hitting 20 separate personal loan sites when they could just come to our site and get those same 20 quotes by filling out one form through us. And even when I say filling out a form, the protocols of the agents working together, it's not even really they need to fill out a form. They're just communicating with our specialty agents that can provide that on their behalf. Our specialty agents that can be on the phone on behalf to get other quotes that you can only get over the phone. Like we're going to be building a lot of this stuff that the big LLMs just simply aren't going to put the attention to over any time in the near future.

So I just to round that out, I mean, I would say we are very excited about the Agentic AI capabilities we're building to both improve the current shopping experience and transform the shopping experience in general, whether it's consumers using our web-based platform to shop, whether it's LLMs or other Agentic AIs accessing our specialty AI agents to shop or whether it's logged in members to get the benefit of our Agentic AI doing secret shopping and/or actively preparing updated offers in real time on their behalf. We're more confident by the day that we can provide huge value to the consumer in the age of AI.

So with that said, before passing over to Jason to comments on the bigger picture financial performance, I just want to reiterate our excitement about the growth we see ahead of us. The North Star is starting to really show real results on our consumers. We've done a lot of testing throughout '26 of millions of different things of how we can use AI and Agentic AI to transform the shopping experience. We feel like we've identified a number of things that can be used across all of the industries we operate in, and we'll be really investing heavily in rolling that all out on a broad macro basis in 2027 and beyond.

So with that, Jason, go ahead.

Jason Bengel

Thanks, Scott. And I think it's useful just to take a step back. And when you look at the midpoint of our guide versus 2023, you're looking at a 25% EBITDA CAGR. You're looking at expenses with a 3% CAGR, in line with inflation essentially. You're looking at net leverage moving from 5.3 to 1.7. So we've made tremendous progress over the last few years. And looking at 2026, we've had some headwinds in 2026, right, but we're still growing EBITDA well into double digits, 14% when you're looking at the midpoint of the guide. That's because we have a diversified portfolio, like Scott alluded to.

You're looking at within 2026, expenses growing around 3% at the midpoint. That's the result of discipline and a focus on driving internal efficiencies with the use of AI. We expect all that to continue into 2027. And I think what's also interesting is when you look at our cash flow, look at our Q3 LTM cash flow, free cash flow, excluding litigation, it's $100 million. So that's a lot of cash available to return to shareholders. And so coming back to the diversified business point, Insurance is performing extremely well, and we expect it to continue to perform extremely well. Home is in a difficult environment. Mortgage is hard right now. But when you look at that segment, you look at sort of the mid-cycle earnings averaging -- just averaging the peak and the trough of Home, that's about $50 million of VMD, higher than where we are today. And the majority of that would drop to EBITDA. We just can't really get confident that's going to happen soon, but there is a massive potential there for that segment because we have a diversified strong business with a great lender network.

This quarter, we paid down $60 million of debt. We saved $5 million in interest expense, bringing our gross debt down to $336 million, pretty -- approaching pretty close to our $200 million longer-term goal. You'll see in our financials, we did take a noncash goodwill impairment of $99 million in Home and Consumer. And that's really involving testing for impairment where we had to consider our market cap on and around September 30. That resulted in the charge. This doesn't reflect a change in our expectations for these segments, but it does reflect a market cap that implies a free cash flow yield ex litigation north of 25%. So we see the attractiveness in these numbers. We see the attractiveness and the upside in our stock. And so in Q4, we're going to be buying back stock, and we're going to continue paying down debt.

And so with that, I'll hand it over to the operator for Q&A.

Operator

[Operator Instructions] Our first question comes from the line of Jed Kelly from Oppenheimer & Co.

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Jed Kelly

Just diving into Insurance, I think one of your competitors last night said they expect this soft market cycle or higher favorable profitability cycle to continue potentially into '28, '29. Are you seeing like the same thing? And do you just have like a good multiyear visibility into insurance over the next couple of years?

Scott Peyree

Yes. I would -- thanks for the question, Jed. I would generally agree with that sentiment you heard yesterday, and it's a very stable industry at this point in the game. And I would say there's probably long term -- it's easier to look out long term and project continued long-term growth today than almost it's ever been. Not that there can't be a big turn where inflation goes way up again or which could affect the insurance companies or they start giving some rate back to the consumers, which affects their profitability.

But yes, I think the industry is more stable now than it's been in a long, long time. It's very profitable. In general, we're seeing -- and I'm sure not just us, our competitors as well are just seeing more players get more aggressive with budget, which is very good for a marketplace business like ours where you have more competition for those consumer clicks. Yes, I would say to '28 and beyond, I mean, outside of some major shift, there's a lot of continued growth, I would expect in that industry.

Another interesting thing I would comment there is like when we look at just the -- like when we look at our market share versus the overall industry, like in insurance, in online performance marketing, which is essentially where we sit in insurance, we probably actually have a lower market share than just about any other industry we're in, even with as big as insurance is for our business. My guess is we are well below 20% market share just within our group. So like there's the whole industry that's going to keep growing for the next few years, and then there's the ability to grow our market share within that industry. So yes, I would have very positive outlook for the insurance industry right now.

Jed Kelly

Great. And then I think, Jason, you mentioned expenses have grown about 3%. Just with AI, how do you feel like relative to your competitors, your opportunity, how do you think you're invested in AI? Do you think -- I mean, do you think you can continue growing expenses at 3%, 4%? Or do you think you're going to have to invest more so you can kind of better harvest this technology? Thanks.

Jason Bengel

Yes. I mean it's -- we're not -- we're still in the 2027 planning phases, I guess. So it's hard to put out a number at this point. But we've had a lot of success using tools that we have today to drive a lot of efficiency on the AI front. When you look at how we run marketing and just using data agents, for example, within marketing, the amount that we've been able to upskill our marketing team by using agents to handle sort of the data gathering and analysis part of their jobs allows them to become much, much more efficient marketers.

And so we're using the tools that we have today with a lot of success, and we fully intend to keep doing that. It is possible that as we move into 2027, we do wind up investing more in AI, but we would expect an outsized increase in productivity moving forward.

Scott Peyree

Yes. And I would just add in there. Yes, it's a little bit of both. Like there's areas we're going to invest into. Like data is a critically important area to have quality of data infrastructure for AI to work effectively, log-in experience, like I was saying. So -- but you can -- just like everyone, you can get so much more done with fewer people in this age of AI. And then at the same time, we're looking where AI can provide efficiencies. So it kind of levels out to some extent when you look at it that way.

Operator

Our next question comes from the line of Youssef Squali from Truist.

Youssef Squali

Scott, I was intrigued by your comments about working with LLM platforms, at least in theory to integrate some of your capabilities within the agent results. Are you actually talking to some of these platforms? And kind of what kind of feedback are you getting from? What kind of reception are you getting from? And I have a follow-up.

Scott Peyree

Yes. We're actively engaged in some platforms more so than others. But it's -- yes, honestly, these companies are growing so fast. They help you where they can. They give you directional information as far as like a lot of these times, they don't even know how their systems work any more than anyone else knows how it works. So they're trying to give you directional like, okay, here's where we believe the AI is finding value and not finding value. There's definitely a number of -- like -- and this is more of a recent thing. A number of, I guess I'll call them Internet protocols are starting to be developed that makes it easier for like AI agents to communicate with companies like ours.

And so I think the fact that we're making sure we're building our platforms to be able to easily communicate with LLM agents, like because not everyone is going to be doing that, obviously, not that we're the only ones doing it. But I mean, the group of us are going to be front end doing that, we'll do it. But yes, I mean, I would say all the major LLMs or just AI companies we've got relationships with. There's only so much they know or they can tell you, but they can help you direct you the way it should be going.

Youssef Squali

Got it. Okay. And then maybe on the other 2 subsegments, Home and Consumer, it's very encouraging to see that you guys still posted positive growth. As we look at 2027, can you maybe just kind of share your initial outlook as to kind of the potential growth prospects for these and still the headwinds ahead ex maybe just rates, which God knows what's going to happen there.

Jason Bengel

Yes. I mean I'll start and then Scott can chime in here. I mean, like I said, we're still a little early in our planning for 2027. So we're not putting out guidance or numbers really at this point. But just thinking about the backdrop, like Scott said, insurance, we expect continued tailwinds for a while. Combined ratios are still very low. I think carriers are going to very carefully manage those combined ratios. Competitiveness is very high. And so I think we'll have a very favorable environment in insurance moving into 2027 and beyond.

Home, like you said, it's a bit more challenging, right? Like it's -- mortgage is in a hard spot. The home sales are at a very, very low level. I want to say 20, 40-year low. So it's hard to be excited about mortgage. But at this point, is really driven by Home equity. And there are record home equity balances and people are renovating their homes. So like there's a real opportunity within home equity to drive growth.

I guess I would say we're really excited about the opportunity to drive traffic. And Scott touched on it, but we're under-indexed in several channels that we fully intend to lean into in 2027 and beyond. And our strategy is focused on driving organic traffic. And we think we can have a real impact moving into 2027 and beyond there as well. So it's a little bit early to be putting out numbers, but I think the backdrop is generally favorable for insurance. It's a little bit complex with home, but it's going to be home equity driven. Consumer, it's really about SMB. We did see a lot of headwinds in SMB early in the year. That's improved. It's been improving. I think we expect it to continue to improve, but it's hard to really guarantee that. So it's really more about how are we going to execute to find additional traffic moving into 2027 and make those investments to keep driving growth.

Scott Peyree

Yes. Then I would just add in briefly. Small business, if it continues to recover. I mean that's a big wildcard. If it gets back to where it was in Q4, Q1 this past year, which is very well good, that would be major growth in and of itself. So that's something we're excited about. And then as I said before, like a real focus on getting more and more users to sign up to become log-in members, which of LendingTree and active users, which increases our long-term value, decreases our cost of acquisition over the long run. Those are the major metrics. So I mean, so if we can start showing improving out those metrics, that will have a significant impact, not only on profitability, but just ability to drive more consumers on top of the funnel.

Operator

Our next question comes from the line of Ryan Tomasello from KBW.

Ryan Tomasello

Hi, everyone. Thanks for taking the questions. Hearing a lot of comments about the focus on growing organic traffic and investing there and understand that makes sense over the long term. But I just want to make sure we're understanding that properly, if there's anything you're telegraphing there around incremental investment next year? And how should we think about the ability to continue to sustain double-digit EBITDA growth even if we do see some incremental investment in parts of the business like that?

Scott Peyree

Yes, I'll hit on it. There's basically 2 lens. We think there's ability to grow a lot of organic traffic by a number of the things we're building in the log-in experience and just being better about more proactively. We've already been doing some testing about more proactively getting consumers that are upfront shopping for whatever product they're shopping for to get them to become log-in members. And I would say we're pretty excited about our ability to onboard members. And so then you got to create that long-term value. That would be like the organic growth.

But then we also feel that there's a lot of growth just in areas where we've arguably been under-indexed compared to our competitors over the last number of years. And that would be social media, which is a massive world of consumers, business development, publishers. We've been building a lot of ad tech around that over the past 9 months, and we'll probably continue investing even more heavily in that to just really get -- to have really good platforms that good ad tech where we can go and place our ads and have publishers and partners more easy to work with us. We feel like that's just a major -- like I would almost call it, if you build it, they will come situation, like we just got to build more of the stuff, onboard more partners, and that will just drive a lot more traffic there as well.

Ryan Tomasello

Great. I appreciate that. And then as a follow-up on SMB. Maybe, Scott, if you can just put a finer point on the -- how the recovery trajectory looked in that business coming out of the second quarter, whether or not you learned anything incremental on the drivers of the earlier weakness, what questions might still be out there and how you're thinking about that recovery progressing into next year?

Scott Peyree

Yes. I would say -- so in Q2, the biggest drivers we had bad for at least early Q2, bad lender sentiment and mainly because these lenders have written a lot of loans in the previous like 6 to 9 months, and they just kind of wanted to -- Iran war started, et cetera, they just want to take a time out and just make sure the loans were performing. And then you had bad merchant sentiment, which a lot of it was gas prices and the Iran war stuff. And I think small and medium-sized businesses are probably honestly even more sensitive to that than consumer lending even is.

And so when we got out of Q2, what we saw the lender sentiment completely turned around, where they're like, "Okay, our loans are performing. Everything is going great. Let's get back to business." We're just -- we're offering loans at the same rate and term that we were a year ago. So that's fully recovered. So that's a really good part. The merchant sentiment has recovered, but not fully. That's where we're still seeing the take rates on loans are lighter than they were in our peak Q4, Q1 peaks and then the average size of loan is a little lighter. And we just feel that's still just kind of a little bit of merchant sentiment, just concern on the macro economy and stuff. But I mean, that's something we fully -- once the sentiment turns around, we -- I mean, we have a long-term history of like what the take rate on loans generally is and what the average loan size really is and no reason to believe we won't be right back there.

Ryan Tomasello

Any way to quantify how far below you are on those take rates and average loan sizes?

Jason Bengel

I mean, I guess one way to look at it is comparing to our original budget. And if SMB was performing at the original budget, we would be north of $160 million EBITDA this year.

Operator

Our next question comes from the line of Danny Pfeiffer from JPMorgan.

Daniel Pfeiffer

For the first, as you have discussions with insurance carriers, can you talk about what their mindset is as it relates to partnering versus blocking AI agents and where LendingTree might fit in that equation?

And then on the second, on the topic of making progress on logged-in member experience, can you talk about your ambitions here? And if you could share any stats on the member base today in terms of like size, return frequency or monetization?

Scott Peyree

I'll start with the first part of the question, just with the insurance carriers. And I would say like, yes, insurance carriers historically, they just -- they don't want their rate tables publicly available to the world because they don't want to start this downward spiral of everyone having to give rate and it's like everyone has to low ball on the upfront rate. If you rewind the insurance industry like 30 years ago, it was a similar problem where they were more public with the rates, but then it was just -- they had to low ball for the first 6 months and then jack everyone's insurance rate up by 50% after 6 months, horrible consumer experience, like, they don't want to get back to that world, and they've made it very clear.

So when they look at like some of these agents like a news coming out and being able to scrape sites that provide rates publicly, which honestly is not a ton of carriers that do that, but there are some that do that. I think like I was saying in the market share of LLMs overall right now, the quantity of consumers actually using LLMs to shop for insurance, I don't think it's -- I don't think they're seeing the quantity that it really concerns them yet.

Now if they started all of a sudden seeing hundreds of thousands of unique rate requests a day, my guess is they would pretty quickly shut that down. Now where they work with us and after working with us, getting back to the logged-in experience, we've had a number of carriers already tell them we're actively building with some. They're like, okay, you're logged in. We don't want to show rates on your public-facing site, but you're logged-in users that are your users, we're more than happy to show rates and let you do secret shopping and provide a lot of value that way. And that's a perfect example where I think our platform is a Specialty Agentic AI platform in the Insurance and Financial services space will be much greater than what any LLM that has honestly much bigger fish to fry will accomplish.

And could you -- what was your second question?

Daniel Pfeiffer

Yes. And maybe on the second, if you could provide any stats or anything on the log-in user base in terms of anything like the size or return frequency or monetization?

Scott Peyree

No, we're not currently providing any stats on those front publicly.

Daniel Pfeiffer

Got it. Thank you.

Scott Peyree

Just for competitive reasons.

Operator

Our next question comes from the line of Mike Grondahl from Northland.

Mike Grondahl

A question on your 4Q guidance. Scott, would you say that, that pretty much reflects seasonality, typical seasonality in the business? Or is there, I don't know, a weakness in the business line you hadn't expected earlier in the year? Just trying to get a feel for how you're thinking about that 4Q.

Jason Bengel

Yes, I can start and then Scott will chime in. I mean we just go segment by segment, I guess, like Home is seasonally lower in Q4. It might be a little bit more low than normal seasonality just given the environment. Consumer is generally going to be flat sequentially Q3 to Q4 with sort of offsetting seasonality between personal loans and small business. Small business has a strong Q4. Personal loans tends to have a weaker Q4. The real uncertainty is with insurance. The last few years, we have gotten very large budgets towards the end of Q4, and so the guide isn't assuming the sort of budgets that we've gotten in prior years. We are assuming we do get sort of a seasonal uptick in insurance budgets, but just less than we have in the prior years. We're just being conservative there. So that is inherent in the guide. But no, there's no single business that's performing particularly poorly Q3 to Q4 to answer your question.

Scott Peyree

And just to add -- the only thing I would add on there is if you look year-over-year, the biggest driver probably is small business. So small business keeps improving from the Q2 trough. But again, I'll reiterate that Q4, Q1 were all-time highs last year for us. And so like even though we're improving and we're coming back, there's still a ways to go to get to those levels, and that's probably the single biggest driver if you look year-over-year.

Mike Grondahl

Got it. That's helpful. And then on the buyback, it seems like you signaled you're going to be engaging in that here in 4Q. Is there 1 or 2 metrics? I mean, I imagine maybe it's debt to adjusted EBITDA has gotten to a level where you're comfortable. It seems like the cost structure, you've got your arms around really tight with inflation growth. Help us think about your kind of appetite for buyback and amongst those metrics.

Jason Bengel

Yes. I mean we're looking at a lot of things. Our debt -- we declared our target debt level is $200 million. In last quarter, we were sitting on $397 million of gross debt in a rising interest rate environment relative to our $200 million target. So we made a big dent in that debt, and we're going to continue paying down debt and returning money to shareholders that way.

When it comes to the buybacks, when you look at where our stock is and has been compared to our free cash flow, it's just pretty obvious that it is an attractive opportunity that we're going to take advantage of. We drove -- like I said, we drove looking back trailing 12 months, $100 million of free cash flow when you exclude litigation payments and you look at that relative to our market cap, it becomes pretty compelling pretty quickly. So that's a big one that we're looking at as well as our EBITDA multiple and the growth implied in it. It all points to a pretty easy decision to lean in and buy back shares in Q4.

Mike Grondahl

Great. I know it's taken a lot of hard work in a couple of years to get there, but congratulations, guys.

Operator

Thank you. This concludes the question-and-answer session. I would now like to turn it back to CEO, Scott Peyree, for closing remarks.

Scott Peyree

Thank you. Just to close, we appreciate you all joining the call and asking the questions you asked. We're just looking forward to continuing to execute and being able to report on continued improvements in the business next quarter. Have a good evening.

Operator

Thank you for your participation in today's conference. This does conclude the program, and you may now disconnect.