Dara Khosrowshahi EVP & CFO, IAC

Dara KhosrowshahiEVP & CFO, IAC

Piper Jaffray Technology ConferenceMay 20, 2004

Prepared 5/20/04 - Read important disclaimer(s)

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$60 Billion in Demand

IAC

Tickets = $5B

Travel = $10B Goods = $2B

Mortgages = $36B

40 MM customers180 MM transactions

140K suppliers

Personals = $0.2B

Customer data includes duplication.

LocalTransactions = $7B


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Beneficial Relationships

World Leading Consumer

Brands

Technology &Innovation

Scale &Infrastructure

MerchandisingExpertise

Multi-Vertical

Capital

Customer Acquisition

Multiple Distribution Channels

Market Segmentation

Marketing Strength

Yield Management

Choice / Product Depth

Convenience / Ease of Use

Great Values

Information / Local Relevance

Exclusivity / Uniqueness

SUPPLIERS IAC aggregates

CONSUMERS


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IAC’s BrandsElectronic Retailing TicketingIAC Travel

IAC Local & Media Services

Financial Services & Real EstatePersonals


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Segment Results LTM

Electronic Retailing TicketingIAC Travel



$1,813

$548

IAC Travel assumes Hotels.com revenue on a net basis. Financial Services & Real Estate includes LendingTree for the full period.

Revenue

OIBA

–

–

$ in millions

$2,288

$202

Revenue

OIBA

–

–

$750

$150

Revenue

OIBA

–

–

$193

$35

Revenue

OIBA

–

–

$254

$19

Revenue

OIBA

–

–

$161

$21

Revenue

OIBA

–

–

30% – Margin 9% – Margin 20% – Margin

18% – Margin 8% – Margin 13% – Margin


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Category Leaders U.S.

Electronic Retailing TicketingIAC Travel



Ticketing includes event and movie ticketing. Data based on Jupiter and IAC estimates. Local includes directional advertising (newspapers, yellow pages, and coupons) only; excludes local TV/radio.

$2T total

$6B TV / $53B online

28% TV share

#2 position

$28B total

$3B online

66% online share

#1 position

$1.5B total

$450M online

30% online share

#1 position

$60B total

$4B online

$5T total

$185B online

20% online share

#2 position

$220B total

$44B online

20% online share

#1 position


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Large Opportunities in Every Business Electronic Retailing TicketingIAC Travel



• U.S. travel only ~25% online

• Int’l travel = $630B • Corporate travel =

$125B

• QVC = 2.2x revenue, 4.5x EBITDA

• “Love the Customer”

• 525 mm tickets in our system; 61% go unsold

• Box office migration• Direct marketing to 20

mm registered users

• $450 mm category• 1 mm subscribers• 22 mm worldwide

monthly unique users

• U.S. local advertising = $60B

• U.S. local search = $1B

• 14 mm merchants; 80,000 IAC customers

• Consumer lending = $5T• LendingTree 0.7% share;

broadening product base• Real estate = $60B in

commissions

Local includes directional advertising (newspapers, yellow pages, and coupons) only; excludes local TV/radio.


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Travel Strategy


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IACT Portfolio of Brands

Air ticketsHotel roomsRental cars

PackagesComplex itinerariesBusiness travel

$$$$

$

Simple Complex


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IACT Portfolio vs. Competitors


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IACT: Outpacing the Market Gross Bookings

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

Q1 '02 Q2 '02 Q3 '02 Q4 '02 Q1 '03 Q2 '03 Q3 '03 Q4 '03 Q1 '04

Expedia

TravelocityOrbitz

Hotels.comPricelineTrip Network

$ in millions


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Worldwide Travel Opportunity

$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000

US Travel International Travel Global Travel &Tourism

Travel

Destination Services

$2.6 trillion

$850 billion

Europe

Other

$220 billion

US$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000


Travel


$2.6 trillion

$850 billion

Europe

Other

$220 billion

US$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000


Travel


$2.6 trillion

$850 billion

Europe

Other

$220 billion

US$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000


Travel


$2.6 trillion

$850 billion

Europe

Other

$220 billion

US$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000


Travel


$2.6 trillion

$850 billion

Europe

Other

$220 billion

US$-

$500

$1,000

$1,500

$2,000

$2,500

$3,000


Travel


$2.6 trillion

$850 billion

Europe

Other

$220 billion

US


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Long Term Goals

Goods

Travel

Ticketing Financial & Realty

xPersonals Local Services

$2,000

$550

$280

$130

$100

$524

$223

$144$1

$31$26

2003OIBA = $860

5-Year OIBA Goal = $3,000

CAGR Goal

$150

25% to 35%

20% to 25%

15% to 20%80% to 90%25% to 30%45% to 50%

$ in millions

2003 and 2008 total OIBA is after corporate and other expenses.


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IAC’s Competitive Advantage 43 leading brands Strong balance sheet Ability to invest aggressively in new

growth areas Shared learning and natural

relationships across Businesses Diversity & reduced volatility

Harnessing the power of interactivity to make people’s lives easier,

everywhere and everyday.


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ImportantSafe Harbor Statement Under The Private Securities Litigation Reform Act Of 1995 This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, particularly statements anticipating future growth in revenues and operating income before amortization. Words such as “believes,” “could,” “expects,” “anticipates,” “estimates,” “intends,” “plans,” “projects,” “seeks,” or similar expressions used in connection with any discussion of future operating or financial performance identify forward-looking statements. These forward-looking statements are necessarily estimates reflecting the best judgment of IAC’s senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. These risks and uncertainties are described in IAC’s filings with the U.S. Securities and Exchange Commission (the “SEC”), including its Annual Report on Form 10-K for the fiscal year ended 2003, especially in the Risk Factors and the Management’s Discussion and Analysis sections, its Quarterly Reports on Form 10-Q and its Current Reports on Form 8-K. Other unknown or unpredictable factors also could have material adverse effects on IAC’s future results, performance or achievements. In light of these risks and uncertainties, the forward-looking events discussed in this presentation may not occur. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date stated, or if no date is stated, as of the date of this presentation. IAC is not under any obligation and does not intend to make publicly available any update or other revisions to any of the forward-looking statements contained in this presentation to reflect circumstances existing after the date of this presentation or to reflect the occurrence of future events even if experience or future events make it clear that any expected results expressed or implied by those forward-looking statements will not be realized.


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Reconciliations$ in millionsRECONCILIATION OF LTM OPERATING INCOME BEFORE AMORTIZATION TO OPERATING INCOME

IAC Local & FinancialElectronic Media Services &

IAC Travel Retailing Ticketing Personals Services Real Estate

Operating Income Before Amortization 548$ 202$ 150$ 35$ 19$ 21$ Amortization and merger costs (186) (53) (27) (18) (57) (25) Operating Income 362$ 148$ 123$ 16$ (38)$ (4)$

Operating Income margin 20% 6% 16% 8% -15% -3%

LTM results for Financial Services and Real Estate include LendiingTree as of Q1 2003.

RECONCILIATION OF 2003 AND 2008 OPERATING INCOME BEFORE AMORTIZATION TO OPERATING INCOME

IAC Travel Electronic Retailing Ticketing2003 2008 2003 2008 2003 2008

Operating Income Before Amortization 524$ 2,000$ 201$ 550$ 145$ 280$ Amortization and merger costs (177) (38) (52) (1) (28) (12)

Operating Income 347$ 1,962$ 149$ 549$ 117$ 268$

Personals Local Services Financial Services & Real Estate2003 2008 2003 2008 2003 2008

Operating Income Before Amortization 31$ 100$ 26$ 150$ 1$ 130$ Amortization and merger costs (17) - (56) (5) (18) (8)

Operating Income 14$ 100$ (29)$ 145$ (17)$ 122$

Teleservices Corporate and Other Total IAC2003 2008 2003 2008 2003 2008

Operating Income Before Amortization 13$ 35$ (80)$ (210)$ 860$ 3,000$ Amortization and merger costs - - (113) (111) (460) (176)

Operating Income 13$ 35$ (193)$ (321)$ 400$ 2,824$

Dara Khosrowshahi EVP & CFO, IAC

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