Net Revenue increased by 4% year over year to a record $370 million
Net Income increased by 16% year over year to $44 million, reflecting a 12% margin
Adjusted EBITDA grew 10% year over year to $100 million, reflecting a 27% margin1
Narrows range of 2025 Net Revenue outlook to $1.465 billion to $1.475 billion; and Adjusted EBITDA2 outlook to $350 million to $360 million
Yelp Inc. (NYSE:YELP), the trusted platform that connects people with great local businesses, today announced its financial results for the second quarter ended June 30, 2025 in the Q2 2025 Shareholder Letter available on its Investor Relations website at yelp-ir.com.
"Our second quarter results reflect solid execution against our product-led strategy," said Jeremy Stoppelman, Yelp's co-founder and chief executive officer. "We continued to see encouraging momentum from our AI initiatives, including the growing adoption of Yelp Assistant, and we began live testing of Yelp Host, one of our AI-powered call answering services. We remain confident that our focus on Services and product innovation position us well to deliver long term shareholder value."
"Yelp's second quarter results demonstrate our commitment to delivering profitable growth," said David Schwarzbach, Yelp's chief financial officer. "We delivered record net revenue of $370 million and strong profitability, with net income margin expanding by one percentage point and adjusted EBITDA margin by two percentage points from the prior-year period. While overall growth moderated amid an uncertain macroeconomic environment, we believe our disciplined financial approach and continued investment in our product-led strategy will drive financial performance over the long-term."
Quarterly Conference Call
Yelp will host a live Q&A session today at 2:00 p.m. Pacific Time to discuss its second quarter financial results and outlook for the third quarter and full year 2025. The webcast of the Q&A can be accessed on the Yelp Investor Relations website at yelp-ir.com. A replay of the webcast will be available at the same website.
| ___________________ |
1 See "Non-GAAP Financial Measures" for definitions of adjusted EBITDA and adjusted EBITDA margin, as well as reconciliations of adjusted EBITDA to net income (loss) and adjusted EBITDA margin to net income (loss) margin, the most directly comparable financial measures calculated and presented in accordance with generally accepted accounting principles in the United States ("GAAP").
|
2 Yelp has not reconciled its adjusted EBITDA outlook to GAAP net income (loss) because it does not provide an outlook for GAAP net income (loss) due to the uncertainty and potential variability of other income, net and provision for (benefit from) income taxes, which are reconciling items between adjusted EBITDA and GAAP net income (loss). Because Yelp cannot reasonably predict such items, a reconciliation of the non-GAAP financial measure outlook to the corresponding GAAP measure is not available without unreasonable effort. We caution, however, that such items could have a significant impact on the calculation of GAAP net income (loss). For more information regarding the non-GAAP financial measures discussed in this release, please see "Non-GAAP Financial Measures" below. |
About Yelp
Yelp Inc. (yelp.com) is a community-driven platform that connects people with great local businesses. Millions of people rely on Yelp for useful and trusted local business information, reviews and photos to help inform their spending decisions. As a one-stop local platform, Yelp helps consumers easily discover, connect and transact with businesses across a broad range of categories by making it easy to request a quote for a service, book a table at a restaurant, and more. Yelp was founded in San Francisco in 2004.
Yelp intends to make future announcements of material financial and other information through its Investor Relations website. Yelp will also, from time to time, disclose this information through press releases, filings with the Securities and Exchange Commission, conference calls, or webcasts, as required by applicable law.
Forward-Looking Statements
This press release contains forward-looking statements relating to, among other things, Yelp's future performance, including its expected financial results for 2025, its ability to drive shareholder value over the long term and its ability to deliver long-term profitable growth, that are based on its current expectations, forecasts and assumptions that involve risks and uncertainties.
Yelp's actual results could differ materially from those predicted or implied and reported results should not be considered as an indication of future performance. Factors that could cause or contribute to such differences include, but are not limited to:
- macroeconomic uncertainty — including related to inflation, interest rates, tariffs, labor and supply chain issues, as well as severe weather events — and its effect on consumer behavior, user activity and advertiser spending;
- Yelp's ability to maintain and expand its base of advertisers, particularly if advertiser turnover substantially worsens and/or consumer demand significantly degrades;
- Yelp's ability to drive continued growth through its strategic initiatives;
- Yelp's ability to continue to operate effectively with a primarily remote work force and attract and retain key talent;
- Yelp's limited operating history in an evolving industry; and
- Yelp's ability to generate and maintain sufficient high-quality content from its users.
Factors that could cause or contribute to such differences also include, but are not limited to, those factors that could affect Yelp's business, operating results and stock price included under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Yelp's most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q at yelp-ir.com or the SEC's website at sec.gov.
YELP INC. CONDENSED CONSOLIDATED BALANCE SHEETS (In thousands) (Unaudited) |
|||||||
|
June 30,
|
|
December 31,
|
||||
Assets |
|
|
|
||||
Current assets: |
|
|
|
||||
Cash and cash equivalents |
$ |
197,687 |
|
|
$ |
217,325 |
|
Short-term marketable securities |
|
103,436 |
|
|
|
100,581 |
|
Accounts receivable, net |
|
155,996 |
|
|
|
155,325 |
|
Prepaid expenses and other current assets |
|
52,292 |
|
|
|
43,648 |
|
Total current assets |
|
509,411 |
|
|
|
516,879 |
|
Property, equipment and software, net |
|
84,234 |
|
|
|
75,669 |
|
Operating lease right-of-use assets |
|
19,865 |
|
|
|
24,112 |
|
Goodwill |
|
136,525 |
|
|
|
130,980 |
|
Intangibles, net |
|
53,944 |
|
|
|
58,787 |
|
Other non-current assets |
|
176,196 |
|
|
|
177,140 |
|
Total assets |
$ |
980,175 |
|
|
$ |
983,567 |
|
|
|
|
|
||||
Liabilities and Stockholders' Equity |
|
|
|
||||
Current liabilities: |
|
|
|
||||
Accounts payable and accrued liabilities |
$ |
142,036 |
|
|
$ |
131,322 |
|
Operating lease liabilities — current |
|
9,832 |
|
|
|
20,679 |
|
Deferred revenue |
|
3,865 |
|
|
|
2,973 |
|
Total current liabilities |
|
155,733 |
|
|
|
154,974 |
|
Operating lease liabilities — long-term |
|
20,746 |
|
|
|
22,470 |
|
Other long-term liabilities |
|
57,292 |
|
|
|
62,154 |
|
Total liabilities |
|
233,771 |
|
|
|
239,598 |
|
|
|
|
|
||||
Stockholders' equity: |
|
|
|
||||
Common stock |
|
— |
|
|
|
— |
|
Additional paid-in capital |
|
1,958,370 |
|
|
|
1,903,598 |
|
Treasury stock |
|
(1,044 |
) |
|
|
(3,909 |
) |
Accumulated other comprehensive loss |
|
(7,139 |
) |
|
|
(15,431 |
) |
Accumulated deficit |
|
(1,203,783 |
) |
|
|
(1,140,289 |
) |
Total stockholders' equity |
|
746,404 |
|
|
|
743,969 |
|
Total liabilities and stockholders' equity |
$ |
980,175 |
|
|
$ |
983,567 |
|
YELP INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) |
|||||||||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||
|
2025 |
|
2024 |
|
2025 |
|
2024 |
||||
Net revenue |
$ |
370,394 |
|
$ |
357,016 |
|
$ |
728,928 |
|
$ |
689,768 |
|
|
|
|
|
|
|
|
||||
Costs and expenses: |
|
|
|
|
|
|
|
||||
Cost of revenue(1) |
|
35,447 |
|
|
30,677 |
|
|
70,275 |
|
|
58,032 |
Sales and marketing(1) |
|
144,612 |
|
|
150,293 |
|
|
290,896 |
|
|
298,084 |
Product development(1) |
|
78,362 |
|
|
82,080 |
|
|
162,267 |
|
|
173,307 |
General and administrative(1) |
|
46,318 |
|
|
44,634 |
|
|
98,025 |
|
|
89,866 |
Depreciation and amortization |
|
12,365 |
|
|
9,585 |
|
|
24,715 |
|
|
19,515 |
Total costs and expenses |
|
317,104 |
|
|
317,269 |
|
|
646,178 |
|
|
638,804 |
Income from operations |
|
53,290 |
|
|
39,747 |
|
|
82,750 |
|
|
50,964 |
Other income, net |
|
5,695 |
|
|
10,322 |
|
|
11,466 |
|
|
18,046 |
Income before income taxes |
|
58,985 |
|
|
50,069 |
|
|
94,216 |
|
|
69,010 |
Provision for income taxes |
|
14,896 |
|
|
12,033 |
|
|
25,736 |
|
|
16,820 |
Net income attributable to common stockholders |
$ |
44,089 |
|
$ |
38,036 |
|
$ |
68,480 |
|
$ |
52,190 |
|
|
|
|
|
|
|
|
||||
Net income per share attributable to common stockholders |
|
|
|
|
|
|
|
||||
Basic |
$ |
0.69 |
|
$ |
0.56 |
|
$ |
1.06 |
|
$ |
0.77 |
Diluted |
$ |
0.67 |
|
$ |
0.54 |
|
$ |
1.03 |
|
$ |
0.73 |
|
|
|
|
|
|
|
|
||||
Weighted-average shares used to compute net income per share attributable to common stockholders |
|
|
|
|
|
|
|
||||
Basic |
|
64,145 |
|
|
67,815 |
|
|
64,700 |
|
|
68,187 |
Diluted |
|
65,683 |
|
|
70,444 |
|
|
66,610 |
|
|
71,574 |
|
|
|
|
|
|
|
|
||||
(1) Includes stock-based compensation expense as follows: |
|
|
|
|
|
|
|
||||
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||
|
2025 |
|
2024 |
|
2025 |
|
2024 |
||||
Cost of revenue |
$ |
1,070 |
|
$ |
1,397 |
|
$ |
2,241 |
|
$ |
2,798 |
Sales and marketing |
|
7,295 |
|
|
8,618 |
|
|
14,934 |
|
|
17,317 |
Product development |
|
17,846 |
|
|
22,534 |
|
|
37,255 |
|
|
46,187 |
General and administrative |
|
8,564 |
|
|
8,665 |
|
|
17,814 |
|
|
17,622 |
Total stock-based compensation |
$ |
34,775 |
|
$ |
41,214 |
|
$ |
72,244 |
|
$ |
83,924 |
YELP INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) |
|||||||
|
Six Months Ended June 30, |
||||||
|
|
2025 |
|
|
|
2024 |
|
Operating Activities |
|
|
|
||||
Net income |
$ |
68,480 |
|
|
$ |
52,190 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
||||
Depreciation and amortization |
|
24,715 |
|
|
|
19,515 |
|
Provision for credit losses |
|
22,562 |
|
|
|
23,957 |
|
Stock-based compensation |
|
72,244 |
|
|
|
83,924 |
|
Amortization of right-of-use assets |
|
6,715 |
|
|
|
7,662 |
|
Deferred income taxes |
|
(2,968 |
) |
|
|
(2,109 |
) |
Amortization of deferred contract cost |
|
12,035 |
|
|
|
12,321 |
|
Other adjustments, net |
|
1,471 |
|
|
|
(2,995 |
) |
Changes in operating assets and liabilities: |
|
|
|
||||
Accounts receivable |
|
(23,935 |
) |
|
|
(31,679 |
) |
Prepaid expenses and other assets |
|
(14,540 |
) |
|
|
(14,914 |
) |
Operating lease liabilities |
|
(15,396 |
) |
|
|
(19,434 |
) |
Accounts payable, accrued liabilities and other liabilities |
|
4,646 |
|
|
|
(15,894 |
) |
Net cash provided by operating activities |
|
156,029 |
|
|
|
112,544 |
|
|
|
|
|
||||
Investing Activities |
|
|
|
||||
Purchases of marketable securities — available-for-sale |
|
(37,201 |
) |
|
|
(53,301 |
) |
Sales and maturities of marketable securities — available-for-sale |
|
34,769 |
|
|
|
49,095 |
|
Purchases of other investments |
|
(700 |
) |
|
|
(2,500 |
) |
Purchases of property, equipment and software |
|
(23,555 |
) |
|
|
(16,574 |
) |
Other investing activities |
|
67 |
|
|
|
234 |
|
Net cash used in investing activities |
|
(26,620 |
) |
|
|
(23,046 |
) |
|
|
|
|
||||
Financing Activities |
|
|
|
||||
Proceeds from issuance of common stock for employee stock-based plans |
|
12,023 |
|
|
|
13,436 |
|
Taxes paid related to the net share settlement of equity awards |
|
(35,155 |
) |
|
|
(41,190 |
) |
Repurchases of common stock |
|
(128,450 |
) |
|
|
(122,657 |
) |
Net cash used in financing activities |
|
(151,582 |
) |
|
|
(150,411 |
) |
|
|
|
|
||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
2,651 |
|
|
|
(295 |
) |
|
|
|
|
||||
Change in cash, cash equivalents and restricted cash |
|
(19,522 |
) |
|
|
(61,208 |
) |
Cash, cash equivalents and restricted cash — Beginning of period |
|
217,682 |
|
|
|
314,002 |
|
Cash, cash equivalents and restricted cash — End of period |
$ |
198,160 |
|
|
$ |
252,794 |
|
Non-GAAP Financial Measures
This press release and statements made during the above referenced webcast may include information relating to Adjusted EBITDA, Adjusted EBITDA margin and Free cash flow, each of which the Securities and Exchange Commission has defined as a "non-GAAP financial measure."
We define Adjusted EBITDA as net income (loss), adjusted to exclude: provision for (benefit from) income taxes; other income, net; depreciation and amortization; stock-based compensation expense; and, in certain periods, certain other income and expense items, such as expenses related to acquired indemnification obligations, acquisition and integration costs and fees related to shareholder activism, and other items that we deem not to be indicative of our ongoing operating performance. We define Adjusted EBITDA margin as Adjusted EBITDA divided by net revenue. We define Free cash flow as net cash provided by (used in) operating activities, less cash used for purchases of property, equipment and software.
Adjusted EBITDA and Free cash flow, which are not prepared under any comprehensive set of accounting rules or principles, have limitations as analytical tools and you should not consider them in isolation or as substitutes for analysis of Yelp's financial results as reported in accordance with generally accepted accounting principles in the United States ("GAAP"). In particular, Adjusted EBITDA and Free cash flow should not be viewed as substitutes for, or superior to, net income (loss) or net cash provided by (used in) operating activities prepared in accordance with GAAP as measures of profitability or liquidity. Some of these limitations are:
- although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and Adjusted EBITDA does not reflect all cash capital expenditure requirements for such replacements or for new capital expenditure requirements;
- Adjusted EBITDA does not reflect changes in, or cash requirements for, Yelp's working capital needs;
- Adjusted EBITDA does not reflect the impact of the recording or release of valuation allowances or tax payments that may represent a reduction in cash available to Yelp;
- Adjusted EBITDA does not consider the potentially dilutive impact of equity-based compensation;
- Adjusted EBITDA does not take into account certain income and expense items, such as expenses related to acquired indemnification obligations, acquisition and integration costs and fees related to shareholder activism, or other costs that management determines are not indicative of ongoing operating performance;
- Free cash flow does not represent the total residual cash flow available for discretionary purposes because it does not reflect our contractual commitments or obligations; and
- other companies, including those in Yelp's industry, may calculate Adjusted EBITDA and Free cash flow differently, which reduces their usefulness as comparative measures.
Because of these limitations, you should consider Adjusted EBITDA, Adjusted EBITDA margin and Free cash flow alongside other financial performance measures, including net income (loss), net cash provided by (used in) operating activities and Yelp's other GAAP results.
The following is a reconciliation of net income to Adjusted EBITDA, as well as the calculation of net income margin and Adjusted EBITDA margin, for each of the periods indicated (in thousands, except percentages; unaudited):
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
2025 |
|
|
|
2024 |
|
|
|
2025 |
|
|
|
2024 |
|
Reconciliation of Net Income to Adjusted EBITDA: |
|
|
|
|
|
|
|
||||||||
Net income |
$ |
44,089 |
|
|
$ |
38,036 |
|
|
$ |
68,480 |
|
|
$ |
52,190 |
|
Provision for income taxes |
|
14,896 |
|
|
|
12,033 |
|
|
|
25,736 |
|
|
|
16,820 |
|
Other income, net(1) |
|
(5,695 |
) |
|
|
(10,322 |
) |
|
|
(11,466 |
) |
|
|
(18,046 |
) |
Depreciation and amortization |
|
12,365 |
|
|
|
9,585 |
|
|
|
24,715 |
|
|
|
19,515 |
|
Stock-based compensation |
|
34,775 |
|
|
|
41,214 |
|
|
|
72,244 |
|
|
|
83,924 |
|
Expenses related to acquired indemnification obligation(2)(3) |
|
55 |
|
|
|
— |
|
|
|
5,181 |
|
|
|
— |
|
Acquisition and integration costs(2) |
|
— |
|
|
|
— |
|
|
|
539 |
|
|
|
— |
|
Fees related to shareholder activism(2) |
|
— |
|
|
|
569 |
|
|
|
— |
|
|
|
1,168 |
|
Adjusted EBITDA |
$ |
100,485 |
|
|
$ |
91,115 |
|
|
$ |
185,429 |
|
|
$ |
155,571 |
|
|
|
|
|
|
|
|
|
||||||||
Net revenue |
$ |
370,394 |
|
|
$ |
357,016 |
|
|
$ |
728,928 |
|
|
$ |
689,768 |
|
Net income margin |
|
12 |
% |
|
|
11 |
% |
|
|
9 |
% |
|
|
8 |
% |
Adjusted EBITDA margin |
|
27 |
% |
|
|
26 |
% |
|
|
25 |
% |
|
|
23 |
% |
(1) |
Includes the release of a $3.1 million reserve related to a one-time payroll tax credit in the three and six months ended June 30, 2024. |
|
(2) |
Recorded within general and administrative expenses on our condensed consolidated statements of operations. |
|
(3) |
Represents expenses recorded in connection with an indemnification obligation assumed in the RepairPal acquisition, which we do not consider to be part of our ongoing operations. We expect to be indemnified for such expenses and will also exclude any such amounts from Adjusted EBITDA. |
The following is a reconciliation of net cash provided by operating activities to Free cash flow for each of the periods indicated (in thousands; unaudited):
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
||||||||||||
|
|
2025 |
|
|
|
2024 |
|
|
|
2025 |
|
|
|
2024 |
|
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow: |
|
|
|
|
|
|
|
||||||||
Net cash provided by operating activities |
$ |
58,034 |
|
|
$ |
39,689 |
|
|
$ |
156,029 |
|
|
$ |
112,544 |
|
Purchases of property, equipment and software |
|
(13,024 |
) |
|
|
(9,587 |
) |
|
|
(23,555 |
) |
|
|
(16,574 |
) |
Free cash flow |
$ |
45,010 |
|
|
$ |
30,102 |
|
|
$ |
132,474 |
|
|
$ |
95,970 |
|
|
|
|
|
|
|
|
|
||||||||
Net cash used in investing activities |
$ |
(14,617 |
) |
|
$ |
(16,644 |
) |
|
$ |
(26,620 |
) |
|
$ |
(23,046 |
) |
|
|
|
|
|
|
|
|
||||||||
Net cash used in financing activities |
$ |
(69,869 |
) |
|
$ |
(66,577 |
) |
|
$ |
(151,582 |
) |
|
$ |
(150,411 |
) |
View source version on businesswire.com: https://www.businesswire.com/news/home/20250807298067/en/
Investor Relations Contact:
Kate Krieger
[email protected]
Press Contact:
Amber Albrecht
[email protected]