UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):  February 3, 2009

IAC/INTERACTIVECORP

(Exact name of registrant as specified in charter)

Registrant’s telephone number, including area code:  (212) 314-7300

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02   Results of Operations and Financial Condition.

Item 7.01   Regulation FD Disclosure.

On February 3, 2009, the Registrant issued a press release announcing its results for the quarter ended December 31, 2008.  The full text of the press release, appearing in Exhibit 99.1 hereto, is incorporated herein by reference.

The attached document is furnished under both Item 2.02 “Results of Operations and Financial Condition” and Item 7.01 “Regulation FD Disclosure.”

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:  February 3, 2009

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EXHIBIT INDEX

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Exhibit 99.1

IAC REPORTS Q4 RESULTS

NEW YORK— February 3, 2009—IAC (Nasdaq: IACI) released fourth quarter 2008 results today.

SUMMARY RESULTS

$ in millions (except per share amounts)

See reconciliation of GAAP to non-GAAP measures beginning on page 9.

Information Regarding the Results:

·                  Q4 Operating Income Before Amortization grew 64%, excluding $4.1 million in spin-off expenses in the prior year period.

·                  The sale of our investment in Jupiter Shop Channel on December 8, 2008 benefited Net Income and Adjusted Net Income by $242.5 million and GAAP EPS and Adjusted EPS by $1.67 and $1.64, respectively.

·                  Q4 Net Income includes a $26.4 million write-down of our investment portfolio, reflecting:

·                  A $7.6 million write-down of our investment in Arcandor AG which impacted GAAP EPS by $0.05. The write down of Arcandor AG did not impact Adjusted Net Income or Adjusted EPS.

·                  An $18.8 million write-down on other investments impacting both GAAP EPS and Adjusted EPS by $0.13.

·                  Q4 Net Income also includes $10.3 million in goodwill and intangible asset impairment charges which impacted GAAP EPS by $0.07. These charges did not impact Adjusted Net Income or Adjusted EPS.

·                  Free Cash Flow for the twelve months of 2008 was $44.4 million, up $143.9 million over the prior year, while cash flow from operating activities attributable to continuing operations increased by $134.2 million over the prior year to $107.7 million.

Principal Areas of Focus:

·                  Search: Relaunched Ask.com in October 2008 and in January 2009 became the official search engine of NASCAR, the second most watched sport in the US with an audience of approximately 75 million. Today, Ask.com announced a partnership with Symantec, the market leader in online security, to power search for the new Norton “Safe Web” product.

·                  Local: Grew the number of local merchants, users and user reviews strongly in Q4. Relaunched Citysearch in beta in November to positive early results including increased registrations and page views. Citysearch’s iPhone application was downloaded over 100,000 times. ServiceMagic completed an investment in Zip Express on November 20.

·                  Personals: Match.com worldwide subscribers grew 5% in Q4 and achieved its highest paid member count ever during the quarter. Subscriptions to Match Mobile, launched late in 2007, continue to grow strongly.

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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DISCUSSION OF FINANCIAL AND OPERATING RESULTS

Media & Advertising

Media & Advertising consists of proprietary search properties such as Ask.com, Fun Web Products, and Dictionary.com, and our proprietary local site, Citysearch, and network properties which include distributed search, sponsored listings and toolbars. Proprietary revenue now represents 70.8% of total Media & Advertising revenue, versus 52.1% in the prior year period.

Media & Advertising revenue reflects a sharp decline in network revenue, resulting from the de-emphasis of relationships with certain partners during 2008 in conjunction with the renewed partnership with Google. Revenue declines also reflect fewer queries across proprietary properties, particularly at Ask.com and Fun Web Products, partially offset by the inclusion of Dictionary.com (acquired July 3, 2008). Revenue declines were also mitigated by overall growth in revenue per query across proprietary properties, due to improved economics associated with the renewed Google partnership, and growth from the Ask toolbar business, which continues to add partners and queries. Query declines at Ask.com reflect significantly lower marketing spend in the period, while revenue per query declines reflect fewer clicks per visit as users find what they are searching for sooner due to the relaunched site’s improved user experience. Citysearch grew revenue slightly during the quarter while users, user reviews and the number of locations containing Citysearch’s editorial voice continued to grow.

Media & Advertising profit declines reflect lower revenue, partially offset by a reduction in marketing spend at Ask.com and a shift in revenues from network to higher margin proprietary properties. Operating income in the current year was negatively impacted by a $9.2 million impairment charge related to intangible assets, reflecting a decline in the performance of our Excite, iWon and MyWay portals businesses, partially offset by a decrease of $5.9 million in amortization of non-cash marketing.

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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Match

Revenue declines reflect a 21% decrease in revenue per subscriber in international markets, due primarily to the unfavorable impact of foreign exchange rates. Excluding the impact of foreign exchange rates, revenue grew 1% as international revenue declines were offset by a 6% and 1% increase in North American subscribers and revenue per subscriber, respectively, due in part to continuing improvements in the site’s features and functionality. Operating Income Before Amortization growth reflects lower customer acquisition costs as a percentage of revenue, due to a shift in the timing of marketing spend to Q4 in the prior year period and lower partner related costs in the current period. Operating income further benefited from a decrease in amortization of non-cash marketing and intangibles of $0.8 million and $0.6 million, respectively.

ServiceMagic

ServiceMagic revenue benefited from an increase in active service providers and an 18% increase in service requests driven by increased marketing efforts. Operating Income Before Amortization slight declines reflect increased marketing costs and higher operating expenses primarily associated with the expansion of the sales force. Revenue and profits were also impacted by slower growth from higher margin discretionary home repair and improvement requests, which we believe is due, in part, to the general economic slowdown. Operating income was impacted by higher non-cash compensation expense.

Emerging Businesses

Emerging Businesses include Shoebuy, Pronto.com, Gifts.com, InstantAction.com, Connected Ventures, RushmoreDrive.com, Life123.com and The Daily Beast. Revenue for the period primarily reflects strong growth at Pronto.com, driven primarily by continued improvements in customer acquisition and monetization. Operating Income Before Amortization declines are due primarily to investment in The Daily Beast, which was not in the year ago figures, as well as InstantAction.com, partially offset by profit growth at Pronto.com. Operating loss was also impacted in Q4 2008 by a $15.0 million impairment charge related to the goodwill and intangible assets of Connected Ventures, partially offset by a decrease in amortization of non-cash marketing of $1.9 million and a decrease in amortization of intangibles of $1.1 million, excluding the impairment charge.

Corporate

Corporate expense for the prior year period included $4.1 million in expenses related to the spin-offs and $2.7 million in additional payroll taxes paid related to the exercise of options during the quarter. Corporate expense in the current year period benefited from a reduction in insurance reserves due to favorable loss experience, lower professional fees, payroll expense and depreciation. Operating loss was also impacted by a decrease of $10.9 million in non-cash compensation expense, due in part, to the reversal of the cumulative expense related to performance-based RSUs which are not probable of vesting.

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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OTHER ITEMS

The sale of our investment in Jupiter Shop Channel on December 8, 2008 for $493 million resulted in a pre-tax gain of $352 million, which is reflected within Q4 other income (expense) as a gain on sale of long-term investments.

During Q4 2008, the Company concluded the decline in the value of its 5.5 million shares of Arcandor AG, received in connection with the sale of HSE24, was other than temporary and thus recorded a $34.1 million impairment charge to write down the value of that investment, which is reflected in other (expense) income. Q4 2007 includes a gain of $16.4 million related to the increase in the value of the derivative asset received in connection with the sale of HSE24; there was no net change in the value of this asset in Q4 2008 and its carrying value was $57.2 million at December 31, 2008. Q4 2008 other income (expense) also includes an $18.8 million impairment charge related to certain investments which the Company has determined to be other than temporarily impaired.

The effective tax rates for continuing operations and Adjusted Net Income in Q4 2008 were 23% and 32%, respectively. These effective tax rates were lower than the statutory rate of 35% due principally to foreign tax credits generated by the sale of Jupiter Shop Channel and foreign income taxed at lower rates, partially offset by an increase in valuation allowances on deferred tax assets related to other than temporary losses related to investments. The effective tax rate for continuing operations was additionally impacted by a decrease in the valuation allowance on the deferred tax asset related to the Arcandor impairment.  In Q4 2007, the Company recorded a tax benefit of $1.0 million on continuing operations pre-tax income of $1.2 million.  The effective tax rate for this benefit was greater than the statutory rate of 35% due principally to foreign tax credits from investments in unconsolidated subsidiaries, tax-exempt interest income and foreign income taxed at lower rates, partially offset by interest on tax reserves.  The effective tax rate for Adjusted Net Income in Q4 2007 was 63% and was higher than the statutory rate of 35% due principally to interest on tax reserves.

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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LIQUIDITY AND CAPITAL RESOURCES

As of December 31, 2008, IAC had approximately $1.9 billion in cash and marketable securities, and $95.8 million in long-term debt.

DILUTIVE SECURITIES

IAC has various tranches of dilutive securities.  The table below details these securities as well as potential dilution at various stock prices (shares in millions, rounding differences may occur).

*On February 4th, 2009 two tranches of warrants representing 20.8 million shares will expire. One of the tranches, representing 12.5 million shares, has an exercise price of $13.09 per share. The other tranche, representing 8.3 million shares, has an exercise price of $34.29 per share.

OPERATING METRICS

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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CONFERENCE CALL

IAC will audiocast its conference call with investors and analysts discussing the Company’s Q4 financial results on Tuesday, February 3, 2009, at 11:00 a.m. Eastern Time (ET). This call will include the disclosure of certain information, including forward-looking information, which may be material to an investor’s understanding of IAC’s business.  The live audiocast is open to the public at www.iac.com/investors.htm.

GAAP FINANCIAL STATEMENTS

IAC CONSOLIDATED STATEMENT OF OPERATIONS

(unaudited; $ in thousands except per share amounts)

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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IAC CONSOLIDATED BALANCE SHEET

($ in thousands)

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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IAC CONSOLIDATED STATEMENT OF CASH FLOW

(unaudited; $ in thousands)

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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RECONCILIATIONS OF GAAP TO NON-GAAP MEASURES

IAC RECONCILIATION OF OPERATING CASH FLOW FROM CONTINUING OPERATIONS TO FREE CASH FLOW

(unaudited; $ in millions; rounding differences may occur)

For the twelve months ended December 31, 2008, consolidated Free Cash Flow increased by $143.9 million from the prior year period due principally to lower cash taxes paid and lower capital expenditures. Free Cash Flow in 2008 excludes cash tax payments related to the sale of the Company’s interests in Jupiter Shop Channel and HSE24 and cash tax refunds related to the sale of the Company’s interests in EPI and an internal restructuring. Free Cash Flow in 2007 excludes cash tax payments related to the sale of the Company’s interests in PRC and HSE24 and cash tax refunds related to the sale of the Company’s interests in VUE.  Free Cash Flow excludes these cash tax payments and refunds because the proceeds from these sales were not included in cash provided by operating activities.

IAC RECONCILIATION OF GAAP EPS TO ADJUSTED EPS

(unaudited; $ in thousands except per share amounts)

For Adjusted EPS purposes, the impact of RSUs on shares outstanding is based on the weighted average number of RSUs outstanding as compared with shares outstanding for GAAP purposes, which includes RSUs on a treasury method basis. The weighted average number of RSUs outstanding for Adjusted EPS purposes includes the weighted average number of performance-based RSUs that the Company believes are probable of vesting. There are no performance-based RSUs included for GAAP purposes.

SEE IMPORTANT NOTES AT END OF THIS DOCUMENT

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IAC RECONCILIATION OF DETAILED SEGMENT RESULTS TO GAAP

(unaudited; $ in millions; rounding differences may occur)