| Metric | Value ($ M) | Q1 FY26 | Q2 FY25 |
|---|---|---|---|
| Revenue | 205.29 | 0.7% | 6.6% |
| Total Income | 205.29 | 0.7% | 6.6% |
| Expenditure | 194.64 | 4.6% | 0.5% |
| PBT | 12.15 | 218.1% | 2350.0% |
| Net Profit | 5.18 | 370.9% | 2018.5% |
| OPM | 5.19% | 3.85pp | 6.80pp |
| NPM | 2.52% | 1.99pp | 2.66pp |
| EPS | 0.03 | 200.0% |
LegalZoom Reports Q2 2026 Financial Results
06 Aug 2026 · 6 Aug, 1:44 am
Summary
LegalZoom announced its second quarter 2026 financial results, reporting revenue of $205.3 million, up 7% year-over-year, driven by an 11% increase in subscription revenue. The company achieved a net income of $5.2 million with a 3% net income margin, and Adjusted EBITDA of $45.9 million with a 22% margin, both showing significant year-over-year improvement. Management is updating the full-year revenue outlook to $795.0–$805.0 million and Adjusted EBITDA to $190.0–$195.0 million, reflecting industry shifts in customer discovery while maintaining margin discipline.
Key Highlights
- 1
LegalZoom reported second quarter 2026 revenue of $205.3 million, an increase of 7% year-over-year.
- 2
Subscription revenue grew 11% year-over-year to $133.4 million, marking the fifth consecutive quarter of double-digit subscription revenue growth.
- 3
Net income for the quarter was $5.2 million, with a net income margin of 3%, an improvement of approximately 260 basis points year-over-year.
- 4
Adjusted EBITDA reached $45.9 million, representing a margin of 22%, exceeding the high end of the guidance range and increasing approximately 220 basis points year-over-year.
- 5
The company completed $45.5 million of share repurchases in the quarter, with approximately $80.4 million remaining under the existing authorization.
- 6
LegalZoom ended the quarter with $167.2 million in cash and cash equivalents and generated $33.7 million in free cash flow.
- 7
The full-year 2026 revenue outlook was updated to $795.0–$805.0 million and Adjusted EBITDA to $190.0–$195.0 million.
Management Comments
Jeff Stibel
Since late 2024, we've deliberately repositioned LegalZoom around subscription relationships that pair AI with trusted human expertise. That strategy is working. While demand for what we do is intact, discovery is moving. We have been actively building new customer acquisition channels for more than a year, and our outlook fully reflects today's environment, with no recovery in traditional search assumed. In the AI channels where discovery is heading, every visit is incremental. We've partnered with the leading AI companies, we have more brand references across AI platforms than any competitor, and we haven't assumed how quickly this scales. That's the upside we're positioned to capture.
Noel Watson
We're updating our revenue expectations based on recent changes in the customer acquisition environment, while our profitability outlook reflects the discipline of our operating model. We continue to improve operating efficiency, expand margins and generate strong cash flow while investing behind the initiatives that support our long-term growth strategy.
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