How Do Buybacks and Profitability Shape IAC's (IAC) Growth Outlook Amid Revenue Declines?

• IAC Inc. recently reported its second quarter 2025 results, posting net income of US$211.45 million compared to a net loss a year ago, alongside ongoing share repurchases that have amounted to over 8.8 million shares since 2020.
• Remarkably, the company achieved this earnings turnaround despite a decline in quarterly and year-to-date revenues, highlighting improved profitability and margin execution.
• We'll explore how IAC's return to profitability and steady buybacks may influence the investment narrative and future growth expectations.

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IAC Investment Narrative Recap

To own shares in IAC today, an investor must believe in the company's ability to boost profitability through focused margin execution and capital returns, even amid shrinking revenue and digital advertising headwinds. The recent swing to net income is significant for sentiment but does not materially alter the biggest short-term catalyst, successful monetization from new product initiatives, or the central risk, ongoing weakness in digital ad pricing and secular pressure on search-driven traffic.

Among recent updates, IAC’s steady share repurchase program stands out, with over 8.8 million shares bought back since 2020. This move has consistently signaled management’s confidence while supporting the share price; however, with ongoing revenue declines, future buybacks may not fully offset the impact of external industry risks on value creation.

Yet, despite this renewed profitability, investors should be aware that ongoing market shifts in digital ad budgets could still pose...

Read the full narrative on IAC (it's free!)

IAC's narrative projects $2.5 billion revenue and $170.0 million earnings by 2028. This requires a 12.1% yearly revenue decline and a $989.9 million increase in earnings from the current -$819.9 million.

Uncover how IAC's forecasts yield a $51.00 fair value, a 47% upside to its current price.

Exploring Other Perspectives

Three investors in the Simply Wall St Community estimate IAC’s fair value between US$46.26 and US$177.63 per share. While some see significant upside, persistent pressure on advertising revenue remains a central concern for the company’s outlook, explore the full range of market opinions.

Explore 3 other fair value estimates on IAC - why the stock might be worth over 5x more than the current price!

Build Your Own IAC Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your IAC research is our analysis highlighting 4 key rewards that could impact your investment decision.
• Our free IAC research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate IAC's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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