MeridianLink, Inc. reported its financial results for the third quarter and nine months ended September 30, 2024, highlighting a mixed performance in revenue and profitability compared to the previous fiscal period. The company generated revenues of $80.4 million for the third quarter, a 5% increase from $76.5 million in the same period of 2023. For the nine months, revenues rose to $236.9 million, up 3% from $229.0 million year-over-year. The growth was primarily driven by Lending Software Solutions, although it was partially offset by decreased revenue from Data Verification Services due to lower mortgage-related volumes.

Gross profit for the third quarter increased to $52.7 million, a 7% rise from $49.5 million in Q3 2023. However, total operating expenses surged to $50.2 million, up 14% from $43.9 million in the prior year, leading to a decline in operating income to $2.6 million from $5.6 million. The net loss for the third quarter widened to $7.1 million, compared to a loss of $2.1 million in Q3 2023. For the nine-month period, the net loss increased to $22.0 million from $13.0 million in the previous year.

The company’s accumulated deficit grew significantly to $(274.1 million) as of September 30, 2024, compared to $(146.5 million) at the end of 2023. Total liabilities rose to $549.6 million, up from $488.0 million, while total stockholders’ equity decreased to $418.3 million from $508.2 million.

MeridianLink has been actively managing its workforce, completing a 12% reduction as part of its 2024 Realignment Plan, which incurred restructuring charges of $4.2 million. The company also authorized a stock repurchase program in January 2024 for up to $125 million, with approximately $31.3 million utilized for repurchases in Q3 2024.

In terms of strategic developments, MeridianLink completed a secondary offering of 6 million shares at $21.05 per share on September 30, 2024, with associated costs of $0.7 million. The company continues to focus on enhancing its cloud-based offerings and has identified a material weakness in its internal controls over financial reporting, particularly related to customer contract setup and billing.

Overall, while MeridianLink experienced revenue growth, it faced challenges in profitability and operational efficiency, necessitating ongoing adjustments to its business strategy in response to market conditions and internal assessments.