Companies /Industrials

LegalZoom.com Inc

NASDAQ: LZ Specialty Business Services
$6.05
â–² $0.15 (+2.54%) today
Markets closed · 5:56pm ET

Q4 2025 Earnings

Reported Feb 19, 2026, 11:04am ET · SEC source
$0.17
Miss −4.17%
EPS · est. $0.18
$190.3M
Beat +2.93%
Revenue · est. $184.9M
−6.7%
Trailing market
LZ vs S&P since report
1 quarter
Consecutive EPS beats

Market Reaction

% change · around the report
−8%−4%0+4%Feb 19Feb 20report 11:04am ETearnings+0.7%−7.3%
−8%−4%0+4%Feb 19Feb 20earnings+0.7%−7.3%
LZ −7.3%S&P 500 +0.7%
−8%−4%0+4%Feb 19Feb 20report 11:04am ETearnings+0.8%−7.3%
−8%−4%0+4%Feb 19Feb 20earnings+0.8%−7.3%
LZ −7.3%NASDAQ +0.8%
−10%−5%0Feb 18Feb 27report 11:04am ETearnings+0.1%−2.3%
−10%−5%0Feb 18Feb 27earnings+0.1%−2.3%
LZ −2.3%S&P 500 +0.1%
−10%−5%0Feb 18Feb 27report 11:04am ETearnings+0.5%−2.3%
−10%−5%0Feb 18Feb 27earnings+0.5%−2.3%
LZ −2.3%NASDAQ +0.5%
+1.15%
Day of report
−6.95%
Next session
−0.57%
One week
−10.92%
30 days

S&P 500 over the same 30 days: −4.25%.

Did LZ Beat Earnings? Q4 2025 Results

LegalZoom posted a mixed fourth quarter for fiscal 2025, beating on revenue while falling just short on the bottom line — a split verdict that underscores both the momentum and the cost pressures shaping the company's growth story. Revenue came in at $190.27 million, up 17.7% year-over-year and ahead of the $184.67 million consensus, powered by a 20% surge in subscription revenue to $130.95 million as the company continues steering customers toward its higher-value, human-in-the-loop service model. On earnings, however, LegalZoom delivered $0.17 per share, <a href="https://247wallst.com/investing/2026/02/26/one-quarter-ago-zoom-beat-by-148-this-quarter-it-missed/">missing the $0.1774 estimate</a> by 4.17%, as sales and marketing expenses ballooned to $62.95 million from $47.51 million a year ago, weighing on GAAP net income despite adjusted EBITDA growing 13% to $49.89 million. The company enters 2026 with record free cash flow of $147.92 million and a clean balance sheet carrying $203.10 million in cash and no debt, guiding full-year revenue to $805–$825 million and adjusted EBITDA of $190–$200 million as it leans into AI-driven legal services.

Key Takeaways
  • Subscription revenue growth of 20% YoY in Q4 driven by higher-value customers and differentiated human-in-the-loop service offerings
  • Formation Nation acquisition contributions to revenue growth
  • Transaction revenue growth of 12% YoY in Q4
  • Business formations up 17% YoY in Q4 to 112 thousand
  • Average order value increased 13% YoY to $248 in Q4
  • Subscription units at period end grew 10% YoY to 1,939 thousand
  • ARPU increased 1% YoY to $266

“LegalZoom is built for where the market is going. AI is transforming how legal work starts, which is opening up new markets. We are winning by delivering customers to the finish line with trust, judgment, and execution.”

LegalZoom CEO, on the earnings call

Forward Guidance & Outlook

For Q1 2026, LegalZoom expects revenue of $200-$203 million (10% YoY growth at midpoint) and Adjusted EBITDA of $34-$36 million (5% YoY decrease at midpoint due to shifted marketing investment timing). For full-year 2026, the company guides revenue of $805-$825 million (approximately 8% YoY growth at midpoint) reflecting continued momentum of growth initiatives including higher-value customer acquisition and differentiated human-in-the-loop service offerings, and Adjusted EBITDA of $190-$200 million (13% YoY growth at midpoint) reflecting improved gross margins and disciplined cost management. Management believes growth will accelerate in future years.

LZ YoY Financials

Q4 2025 vs Q4 2024 · SEC filings Q4 2024 Q4 2025
$0$60.0M$120.0M$180.0M$161.7M$190.3MRevenue$108.3M$128.5MGross Profit$13.1M$12.6MOperating Income$12.9M$6.1MNet Income
$0$60.0M$120.0M$180.0MRevenueGross ProfitOperating IncomeNet Income

LZ Revenue by Segment

Subscription Revenue$130.9M+20.0%
Transaction Revenue$59.3M+12.0%

Figures from SEC filings and company reports. Not investment advice.