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Acquisitions
 9 Months Ended
Mar. 31, 2026
Business Combination [Abstract]  
Acquisitions

6. Acquisitions

On January 2, 2026, the Company completed the acquisition of HomeBuddy, a technology enabled marketplace in the home services vertical that connects homeowners with contractors, to expand the Company’s home services footprint and strengthen its media and customer relationships. In exchange for all of the outstanding equity interests of HomeBuddy, the Company paid $114.8 million in cash at closing and is obligated to pay $75.0 million in post‑closing payments (“Anniversary Payments”), payable in equal annual installments over four years, beginning on the first anniversary of the closing date. The Anniversary Payments represent deferred consideration and were recorded at their present fair value at the acquisition date. The deferred consideration is accreted as interest expense over the four year term using the effective interest rate method.

The following table summarizes the Company’s preliminary calculation of the total purchase price as of the acquisition date (in thousands):

 

 

 

Estimated Fair Value

 

Cash

 

$

114,814

 

Anniversary payments fair value

 

 

64,889

 

Total

 

$

179,703

 

 

The acquisition was accounted for as a business combination and the results of operations of HomeBuddy have been included in the Company’s results of operations from January 2, 2026. Transaction costs related to the acquisition, consisting of advisory, accounting, and legal fees, were $1.3 million and $3.5 million for the three and nine months ended March 31, 2026, and were recognized within general and administrative expenses in the consolidated statements of operations.

The Company entered into continuation of service agreements with certain HomeBuddy personnel for continued service post-acquisition. The retention bonuses are treated as post-combination compensation expense, vest over 6, 12, or 18 month periods, and are contingent upon continued employment with the Company. Retention bonus expense was $0.9 million for the three and nine months ended March 31, 2026, and was recognized within cost of revenue and operating expenses in the consolidated statements of operations.

The Company allocated the preliminary purchase price to identifiable assets acquired and liabilities assumed based on their estimated fair values. The preliminary fair value of the assets acquired and liabilities assumed was determined by the Company. Management also engaged a third-party valuation specialist to assist with the measurement of the preliminary fair value of identifiable intangible assets. The estimated fair value of the identifiable assets acquired and liabilities assumed was based on management’s best estimates. The intangible assets acquired include customer relationships, tradename and trademarks, developed technology, and noncompetition agreements. The fair value of the customer relationships was determined using the multi-period excess earnings method. The significant

assumptions used in determining the preliminary fair values of the customer relationships intangible assets included revenue growth rates, gross margin, customer retention rate, and discount rate. The fair value of tradename and trademarks was determined using the relief-from-royalty method. The significant assumptions used in determining the preliminary fair values of the tradename and trademarks included trade name life, royalty rates and the discount rate. The fair value of developed technology was determined using the replacement cost method. The fair value of noncompetition agreement was determined using the with-and-without method.

The excess of the purchase price over the aggregate fair value of the identifiable assets acquired was recorded as goodwill and is primarily attributable to synergies the Company expects to achieve related to the acquisition. The goodwill is not deductible for tax purposes. The Company manages its operations as a single operating segment and allocates goodwill to the single reporting segment based on expected benefit from synergies.

The following table summarizes the preliminary allocation of the purchase price to the fair values of the identifiable assets acquired and liabilities assumed as of the acquisition date (in thousands):

 

 

 

Estimated Fair Value

 

Assets:

 

 

 

Cash and cash equivalents

 

$

8,789

 

Accounts receivable

 

 

6,638

 

Prepaid expenses and other assets

 

 

2,099

 

Intangible assets

 

 

49,500

 

Total identifiable assets acquired

 

 

67,026

 

 

 

 

 

Liabilities:

 

 

 

Accounts payable

 

 

2,545

 

Accrued liabilities

 

 

16,555

 

Deferred tax liabilities

 

 

4,965

 

Total identifiable liabilities assumed

 

 

24,065

 

 

 

 

 

Net identifiable assets acquired

 

 

42,961

 

Goodwill

 

 

136,742

 

Preliminary purchase price

 

$

179,703

 

 

The following table summarizes the preliminary fair values of the identifiable intangible assets acquired and the estimated useful lives as of the acquisition date (in thousands):

 

 

 

 

 

Estimated
Fair Value

 

 

Estimated Weighted Average Useful Life

Customer relationships

 

 

 

$

35,500

 

 

9 years

Tradename and trademarks

 

 

 

 

10,300

 

 

7 years

Developed technology

 

 

 

 

1,000

 

 

2 years

Noncompetition agreement

 

 

 

 

2,700

 

 

4 years

Total

 

 

 

$

49,500

 

 

 

 

The Company is still finalizing the purchase price and the allocation of the purchase price to the individual assets acquired. Accordingly, these preliminary estimates are subject to change during the measurement period, which is the period subsequent to the acquisition date during which the acquirer may adjust the provisional amounts recognized for a business combination, not to exceed one year from the acquisition date. The final purchase price allocation, which may include changes in the allocations within intangible assets and between intangible assets and goodwill, as well as changes in the estimated useful lives of the intangible assets, will be determined when the Company has completed the detailed review of underlying inputs and assumptions used in its preliminary purchase price allocation. Amortization of intangible assets acquired is recorded in either cost of revenue or operating expenses, based on the nature of the underlying asset.

The following table represents the amount of net revenue and net income from operations related to the HomeBuddy acquisition which has been included in the consolidated statements of operations for the periods indicated subsequent to the acquisition date (in thousands):

 

 

 

 

 

 

 

 

 

Three and Nine Months Ended March 31, 2026

 

Net revenue

 

 

 

 

 

 

 

$

39,078

 

Net income

 

 

 

 

 

 

 

 

1,159

 

 

The unaudited pro forma financial information in the table below summarizes the combined results of operations for the Company and the acquired business of HomeBuddy as though this acquisition had occurred as of the beginning of fiscal year 2025. The unaudited pro forma financial information is presented for illustrative purposes only and does not necessarily reflect what the combined company’s results of operations would have been had the acquisition occurred as of the beginning of fiscal year 2025, nor is it necessarily indicative of the future results of operations of the combined company (in thousands):

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

March 31,

 

 

March 31,

 

 

 

2026

 

 

2025

 

 

2026

 

 

2025

 

Net revenue

 

$

346,095

 

 

$

299,285

 

 

$

1,002,395

 

 

$

926,719

 

Net income

 

 

11,747

 

 

 

3,570

 

 

 

69,439

 

 

 

(943

)

 

The pro forma financial information presented above has been calculated after adjusting the results of Quinstreet, Inc. and HomeBuddy to reflect certain business combination and one-time accounting effects such as fair value adjustment of amortization expense from acquired intangible assets, interest expense on the amounts drawn under the Revolving Credit Facility to finance the acquisition, accretion of post-closing acquisition payments, and acquisition costs. The historical consolidated financial information has been adjusted in the pro forma combined financial results to give effect to pro forma events that are directly attributable to the business combination, reasonably estimable and factually supportable.

The unaudited pro forma financial information above includes a nonrecurring significant adjustment made to account for certain costs incurred as if the acquisition had been completed as of the beginning of fiscal year 2025. Transaction costs of $1.3 million and $3.5 million were excluded from the unaudited pro forma financial information for the three and nine months ended March 31, 2026, but included for the three and nine months ended March 31, 2025.