Net Revenue decreased by 1% year over year to $371 million
Net Income decreased from the prior year to $35 million, reflecting a 9% margin Adjusted EBITDA1 decreased 6% year over year to $92 million, reflecting a 25% margin Updates outlook ranges of 2026 Net Revenue to $1.455 billion to $1.460 billion and 2026 Adjusted EBITDA to $320 million to $325 million2 SAN FRANCISCO--(BUSINESS WIRE)--November 5, 2026--Yelp Inc. (NYSE: YELP), the company that connects people with great local businesses, today posted its financial results for the third quarter ended September 30, 2026 in the Shareholder Letter available on its Investor Relations website at yelp-ir.com.
“Yelp continued to advance its AI transformation in the third quarter, and recently introduced more than 30 new features and updates, including a smarter and more personalized Yelp Assistant,” said Jeremy Stoppelman, Yelp's co-founder and chief executive officer. “Our AI tools for businesses are gaining traction, supported by substantial advances in voice AI that enable more natural conversations in both Yelp Host and Hatch. Continued demand for our trusted local content across the AI ecosystem drove growth in revenue from data licensing. While we expect consumers and local businesses to continue facing a challenging economic environment, I'm confident our strategic initiatives will position Yelp to deliver long-term shareholder value.”
“In the third quarter, Yelp delivered net revenue of $371 million, $1 million above the high end of our outlook range,” said David Schwarzbach, Yelp's chief financial officer. “While advertising revenue remains pressured, other revenue grew 82% year over year to a record annual run rate3 of $136 million, gaining traction toward our target of $250 million. Looking ahead, we believe our disciplined approach and strategic focus on high-return areas will create long-term value.”
Quarterly Conference Call
Yelp will host a live webcast today at 2 p.m. Pacific Time to discuss the third quarter financial results and outlook for the fourth quarter and full year 2026. The webcast 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 the 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, in each case 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 (expense), 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.
3 Other revenue annual run rate is calculated by multiplying the results for a given quarter, excluding out-of-period adjustments, by four.
About Yelp
Yelp Inc. (yelp.com) is a community-driven platform that connects people with great local businesses. Millions rely on Yelp to inform their spending decisions and get things done. By combining authentic human content with AI technologies, including Yelp Assistant, Yelp helps people move seamlessly from discovery to taking action, whether it’s requesting quotes from service pros, making reservations, ordering food, scheduling appointments, or connecting with the right businesses for their needs. 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 the full year 2026 and its expectations regarding other revenue growth, its expectations regarding its AI transformation as well as its investments in and benefits from strategic initiatives, changes to its product offerings and its ability to gain and sustain market acceptance and adoption of those offerings, the implications of trends in its key metrics and its ability to drive 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:
•Adverse macroeconomic conditions — particularly those affecting local economies — and their impact on consumer behavior and advertiser spending;
•Yelp’s ability to maintain and expand its advertiser base;
•Yelp’s ability to execute on its strategic initiatives, including its AI transformation, and the effectiveness thereof;
•Yelp's ability to maintain and increase traffic to and user engagement on its platform, including its ability to generate, maintain and recommend sufficient content that consumers find relevant, helpful and reliable;
•Yelp’s reliance on internet search engines and application marketplaces, certain providers of which offer products and services that compete directly with its products;
•Yelp’s ability to successfully manage acquisitions of new businesses, solutions or technologies, to successfully integrate those businesses, solutions or technologies, including Hatch, and to monetize such acquired products, solutions or technologies;
•Yelp’s ability to continue to effectively operate with a remote work force and attract and retain key talent;
•Yelp’s reliance on third-party service providers and strategic partners;
•Competition in, and the rapid evolution of, Yelp’s industry;
•Yelp’s ability to maintain, protect and enhance its brand; and •Yelp’s ability to maintain the uninterrupted and proper operation of its technology and network infrastructure.
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.
Undue reliance should not be placed on the forward-looking statements in this press release or the above-referenced webcast, which are based on information available to Yelp on the date hereof. Such forward-looking statements do not include the potential impact of any acquisitions or divestitures that may be announced and/or completed after the date hereof. Yelp assumes no obligation to update such statements.
Investor Relations Contact:
Kate Krieger
ir@yelp.com
Press Contact:
Amber Albrecht
press@yelp.com
YELP INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
| September 30, 2026 | December 31, 2025 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | 119,840 | $ | 216,062 | |||||||
| Short-term marketable securities | — | 103,290 | |||||||||
Accounts receivable, net | 151,465 | 153,224 | |||||||||
| Prepaid expenses and other current assets | 42,504 | 42,359 | |||||||||
| Total current assets | 313,809 | 514,935 | |||||||||
| Property, equipment and software, net | 105,541 | 91,685 | |||||||||
| Operating lease right-of-use assets | 14,744 | 16,046 | |||||||||
| Goodwill | 353,354 | 135,847 | |||||||||
| Intangibles, net | 86,413 | 49,038 | |||||||||
| Other non-current assets | 128,877 | 150,927 | |||||||||
| Total assets | $ | 1,002,738 | $ | 958,478 | |||||||
Liabilities and Stockholders’ Equity | |||||||||||
Current liabilities: | |||||||||||
| Accounts payable and accrued liabilities | $ | 159,875 | $ | 158,789 | |||||||
| Operating lease liabilities — current | 7,479 | 7,426 | |||||||||
| Deferred revenue | 10,673 | 5,845 | |||||||||
| Total current liabilities | 178,027 | 172,060 | |||||||||
Revolving credit facility | 75,000 | — | |||||||||
| Operating lease liabilities — long-term | 14,090 | 17,451 | |||||||||
| Other long-term liabilities | 63,696 | 58,115 | |||||||||
| Total liabilities | 330,813 | 247,626 | |||||||||
Stockholders’ equity: | |||||||||||
Preferred stock | — | — | |||||||||
Common stock | — | — | |||||||||
| Additional paid-in capital | 2,091,958 | 2,010,948 | |||||||||
| Treasury stock | — | (999) | |||||||||
| Accumulated other comprehensive loss | (10,054) | (7,677) | |||||||||
| Accumulated deficit | (1,409,979) | (1,291,420) | |||||||||
Total stockholders’ equity | 671,925 | 710,852 | |||||||||
Total liabilities and stockholders’ equity | $ | 1,002,738 | $ | 958,478 | |||||||
YELP INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Net revenue | $ | 370,919 | $ | 376,038 | $ | 1,107,895 | $ | 1,104,966 | |||||||||||||||
| Costs and expenses: | |||||||||||||||||||||||
Cost of revenue(1) | 42,158 | 36,288 | 122,343 | 106,563 | |||||||||||||||||||
Sales and marketing(1) | 151,500 | 150,740 | 458,072 | 441,636 | |||||||||||||||||||
Product development(1) | 64,655 | 78,137 | 212,280 | 240,404 | |||||||||||||||||||
General and administrative(1) | 46,344 | 45,462 | 143,559 | 143,487 | |||||||||||||||||||
| Depreciation and amortization | 17,369 | 12,526 | 51,720 | 37,241 | |||||||||||||||||||
| Total costs and expenses | 322,026 | 323,153 | 987,974 | 969,331 | |||||||||||||||||||
| Income from operations | 48,893 | 52,885 | 119,921 | 135,635 | |||||||||||||||||||
| Other income, net | 1,351 | 5,350 | 4,670 | 16,816 | |||||||||||||||||||
| Income before income taxes | 50,244 | 58,235 | 124,591 | 152,451 | |||||||||||||||||||
| Provision for income taxes | 15,692 | 18,911 | 40,652 | 44,647 | |||||||||||||||||||
| Net income attributable to common stockholders | $ | 34,552 | $ | 39,324 | $ | 83,939 | $ | 107,804 | |||||||||||||||
| Net income per share attributable to common stockholders | |||||||||||||||||||||||
| Basic | $ | 0.64 | $ | 0.62 | $ | 1.49 | $ | 1.68 | |||||||||||||||
| Diluted | $ | 0.63 | $ | 0.61 | $ | 1.48 | $ | 1.63 | |||||||||||||||
| Weighted-average shares used to compute net income per share attributable to common stockholders | |||||||||||||||||||||||
| Basic | 54,393 | 63,025 | 56,155 | 64,136 | |||||||||||||||||||
| Diluted | 54,787 | 64,216 | 56,765 | 65,975 | |||||||||||||||||||
(1) Includes stock-based compensation expense as follows: | |||||||||||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Cost of revenue | $ | 1,176 | $ | 997 | $ | 3,558 | $ | 3,238 | |||||||||||||||
Sales and marketing | 5,806 | 7,052 | 18,342 | 21,986 | |||||||||||||||||||
| Product development | 8,728 | 16,607 | 34,109 | 53,862 | |||||||||||||||||||
| General and administrative | 7,378 | 8,225 | 23,335 | 26,039 | |||||||||||||||||||
| Total stock-based compensation | $ | 23,088 | $ | 32,881 | $ | 79,344 | $ | 105,125 | |||||||||||||||
YELP INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| Nine Months Ended September 30, | |||||||||||
| 2026 | 2025 | ||||||||||
| Operating Activities | |||||||||||
| Net income | $ | 83,939 | $ | 107,804 | |||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
| Depreciation and amortization | 51,720 | 37,241 | |||||||||
| Provision for credit losses | 27,411 | 34,155 | |||||||||
| Stock-based compensation | 79,344 | 105,125 | |||||||||
| Amortization of right-of-use assets | 4,311 | 8,834 | |||||||||
| Deferred income taxes | 27,542 | 29,829 | |||||||||
| Amortization of deferred contract cost | 16,572 | 17,963 | |||||||||
| Other adjustments, net | 4,656 | 2,523 | |||||||||
| Changes in operating assets and liabilities, net of acquisition: | |||||||||||
| Accounts receivable | (25,226) | (33,013) | |||||||||
| Prepaid expenses and other assets | (31,283) | (32,692) | |||||||||
| Operating lease liabilities | (6,096) | (18,284) | |||||||||
| Accounts payable, accrued liabilities and other liabilities | 699 | 28,062 | |||||||||
| Net cash provided by operating activities | 233,589 | 287,547 | |||||||||
| Investing Activities | |||||||||||
Purchases of marketable securities | (5,975) | (60,987) | |||||||||
| Sales and maturities of marketable securities | 109,293 | 59,782 | |||||||||
Purchases of other investments | (650) | (700) | |||||||||
Maturities of other investments | 5,000 | — | |||||||||
Acquisition, net of cash received | (263,600) | — | |||||||||
| Purchases of property, equipment and software | (42,820) | (36,136) | |||||||||
| Other investing activities | (280) | 64 | |||||||||
| Net cash used in investing activities | (199,032) | (37,977) | |||||||||
| Financing Activities | |||||||||||
| Proceeds from issuance of common stock for employee stock-based plans | 19,476 | 12,295 | |||||||||
| Taxes paid related to the net share settlement of equity awards | (24,609) | (46,624) | |||||||||
| Repurchases of common stock | (200,100) | (203,450) | |||||||||
Proceeds from revolving credit facility | 165,000 | — | |||||||||
Repayments on revolving credit facility | (90,000) | — | |||||||||
Other financing activities | (119) | — | |||||||||
| Net cash used in financing activities | (130,352) | (237,779) | |||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | (116) | 2,016 | |||||||||
| Change in cash, cash equivalents and restricted cash | (95,911) | 13,807 | |||||||||
| Cash, cash equivalents and restricted cash — Beginning of period | 216,289 | 217,682 | |||||||||
| Cash, cash equivalents and restricted cash — End of period | $ | 120,378 | $ | 231,489 | |||||||
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 (expense), net; depreciation and amortization; stock-based compensation expense; and, in certain periods, certain other operating income and expense items, such as expenses for which we expect to be indemnified, acquisition and integration costs, 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 indemnifiable expenses, acquisition and integration costs, 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 September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Reconciliation of Net Income to Adjusted EBITDA: | |||||||||||||||||||||||
| Net income | $ | 34,552 | $ | 39,324 | $ | 83,939 | $ | 107,804 | |||||||||||||||
| Provision for income taxes | 15,692 | 18,911 | 40,652 | 44,647 | |||||||||||||||||||
| Other income, net | (1,351) | (5,350) | (4,670) | (16,816) | |||||||||||||||||||
| Depreciation and amortization | 17,369 | 12,526 | 51,720 | 37,241 | |||||||||||||||||||
| Stock-based compensation | 23,088 | 32,881 | 79,344 | 105,125 | |||||||||||||||||||
Indemnifiable expenses(1)(2) | 139 | (226) | 1,387 | 4,955 | |||||||||||||||||||
Acquisition and integration costs(1)(3) | 2,779 | — | 10,679 | 539 | |||||||||||||||||||
| Adjusted EBITDA | $ | 92,268 | $ | 98,066 | $ | 263,051 | $ | 283,495 | |||||||||||||||
| Net revenue | $ | 370,919 | $ | 376,038 | $ | 1,107,895 | $ | 1,104,966 | |||||||||||||||
| Net income margin | 9 | % | 10 | % | 8 | % | 10 | % | |||||||||||||||
| Adjusted EBITDA margin | 25 | % | 26 | % | 24 | % | 26 | % | |||||||||||||||
(1) Recorded within general and administrative expenses on our condensed consolidated statements of operations.
(2) Represents expenses for which we expect to be indemnified in connection with our acquisition of RepairPal. Indemnifiable expenses during the three and nine months ended September 30, 2026 and 2025 consist of expenses recorded in connection with an indemnification obligation assumed in the RepairPal acquisition and, in the current-year periods, tax payments related to pre-acquisition tax periods, in each case net of indemnification payments received through the release of funds from the RepairPal holdbacks.
(3) Acquisition and integration costs during the three and nine months ended September 30, 2026 represent costs related to the Hatch acquisition and include accrued acquisition- and integration-related compensation. Acquisition and integration costs during the three and nine months ended September 30, 2025 represent costs related to the RepairPal acquisition.
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 September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||||||||||
| Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow: | |||||||||||||||||||||||
| Net cash provided by operating activities | $ | 99,951 | $ | 131,518 | $ | 233,589 | $ | 287,547 | |||||||||||||||
| Purchases of property, equipment and software | (15,411) | (12,581) | (42,820) | (36,136) | |||||||||||||||||||
| Free cash flow | $ | 84,540 | $ | 118,937 | $ | 190,769 | $ | 251,411 | |||||||||||||||
| Net cash used in investing activities | $ | (15,766) | $ | (11,357) | $ | (199,032) | $ | (37,977) | |||||||||||||||
| Net cash used in financing activities | $ | (58,138) | $ | (86,197) | $ | (130,352) | $ | (237,779) | |||||||||||||||