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SAN FRANCISCO--(BUSINESS WIRE)--Feb 9, 2023--
Yelp Inc. (NYSE: YELP), the company that connects people with great local businesses, today posted its financial results for the fourth quarter and full year ended Dec. 31, 2022 in the Q4 and Full Year 2022 Shareholder Letter available on its Investor Relations website at yelp-ir.com.
“We delivered a number of record financial results in 2022 thanks to the strong execution of our teams on our product-led strategy,” said Jeremy Stoppelman, Yelp’s co-founder and chief executive officer. “Record net revenue, driven by record advertising revenue from services businesses as well as in our most efficient sales channels, reflected strong advertiser demand across categories. We also reached record levels in the number of business locations that advertise on Yelp and the average amount each location spends, signaling that our product investments are paying off. Looking ahead, we’re confident in our plan to drive profitable growth over the long term as we deliver on our mission to connect consumers with local businesses.”
“Yelp’s strong performance in 2022 led to 16% year over year net revenue growth, reaching a record $1.2 billion,” said David Schwarzbach, Yelp’s chief financial officer. “These results demonstrate the strength of our broad-based local advertising platform and the momentum across our strategic initiatives. In 2023, we plan to continue our disciplined investments to drive shareholder value over the long term.”
1 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.
2022 Key Business Highlights
Yelp’s product-led business model drove a number of record results in 2022, even as macro challenges persisted:
Outlook
The company expects 2023 Net revenue will be in the range of $1.29 billion to $1.31 billion as it continues executing on its strategic initiatives. The company also expects Adjusted EBITDA will be in the range of $290 million to $310 million.
Quarterly Conference Call
Yelp will host a live Q&A session today at 2:00 p.m. Pacific Time to discuss the fourth quarter and full year 2022 financial results and outlook for the first quarter and full year 2023. 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.
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 and its investment plans, including the ability of its investments and initiatives to drive profitable long-term growth and shareholder value, 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:
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 or 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) | |||||||
| December 31, |
| December 31, | ||||
Assets |
|
|
| ||||
Current assets: |
|
|
| ||||
Cash and cash equivalents | $ | 306,379 |
|
| $ | 479,783 |
|
Short-term marketable securities |
| 94,244 |
|
|
| — |
|
Accounts receivable, net |
| 131,902 |
|
|
| 107,358 |
|
Prepaid expenses and other current assets |
| 63,467 |
|
|
| 57,536 |
|
Total current assets |
| 595,992 |
|
|
| 644,677 |
|
Property, equipment and software, net |
| 77,224 |
|
|
| 83,857 |
|
Operating lease right-of-use assets |
| 97,392 |
|
|
| 140,785 |
|
Goodwill |
| 102,328 |
|
|
| 105,128 |
|
Intangibles, net |
| 8,997 |
|
|
| 10,673 |
|
Other non-current assets |
| 133,989 |
|
|
| 65,408 |
|
Total assets | $ | 1,015,922 |
|
| $ | 1,050,528 |
|
|
|
|
| ||||
Liabilities and Stockholders’ Equity |
|
|
| ||||
Current liabilities: |
|
|
| ||||
Accounts payable and accrued liabilities | $ | 137,950 |
|
| $ | 119,620 |
|
Operating lease liabilities — current |
| 39,674 |
|
|
| 40,237 |
|
Deferred revenue |
| 5,200 |
|
|
| 4,156 |
|
Total current liabilities |
| 182,824 |
|
|
| 164,013 |
|
Operating lease liabilities — long-term |
| 86,661 |
|
|
| 127,979 |
|
Other long-term liabilities |
| 36,113 |
|
|
| 7,218 |
|
Total liabilities |
| 305,598 |
|
|
| 299,210 |
|
|
|
|
| ||||
Stockholders’ equity: |
|
|
| ||||
Common stock |
| — |
|
|
| — |
|
Additional paid-in capital |
| 1,649,692 |
|
|
| 1,522,572 |
|
Accumulated other comprehensive loss |
| (15,545 | ) |
|
| (11,090 | ) |
Accumulated deficit |
| (923,823 | ) |
|
| (760,164 | ) |
Total stockholders’ equity |
| 710,324 |
|
|
| 751,318 |
|
Total liabilities and stockholders’ equity | $ | 1,015,922 |
|
| $ | 1,050,528 |
|
YELP INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) (Unaudited) | |||||||||||||||
| Three Months Ended |
| Year Ended | ||||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | ||||||||
Net revenue | $ | 309,103 |
| $ | 273,400 |
|
| $ | 1,193,506 |
| $ | 1,031,839 |
| ||
|
|
|
|
|
|
|
| ||||||||
Costs and expenses: |
|
|
|
|
|
|
| ||||||||
Cost of revenue (1) |
| 28,483 |
|
| 24,045 |
|
|
| 105,705 |
|
| 78,097 |
| ||
Sales and marketing (1) |
| 126,357 |
|
| 113,379 |
|
|
| 514,927 |
|
| 454,224 |
| ||
Product development (1) |
| 72,225 |
|
| 70,384 |
|
|
| 305,561 |
|
| 276,473 |
| ||
General and administrative (1) |
| 37,967 |
|
| 28,859 |
|
|
| 164,108 |
|
| 135,816 |
| ||
Depreciation and amortization |
| 10,687 |
|
| 17,140 |
|
|
| 44,852 |
|
| 55,683 |
| ||
Restructuring |
| — |
|
| — |
|
|
| — |
|
| 32 |
| ||
Total costs and expenses |
| 275,719 |
|
| 253,807 |
|
|
| 1,135,153 |
|
| 1,000,325 |
| ||
Income from operations |
| 33,384 |
|
| 19,593 |
|
|
| 58,353 |
|
| 31,514 |
| ||
Other income, net |
| 3,478 |
|
| 626 |
|
|
| 8,425 |
|
| 2,204 |
| ||
Income before income taxes |
| 36,862 |
|
| 20,219 |
|
|
| 66,778 |
|
| 33,718 |
| ||
Provision for (benefit from) income taxes |
| 16,717 |
|
| (2,971 | ) |
|
| 30,431 |
|
| (5,953 | ) | ||
Net income attributable to common stockholders | $ | 20,145 |
| $ | 23,190 |
|
| $ | 36,347 |
| $ | 39,671 |
| ||
|
|
|
|
|
|
|
| ||||||||
Net income per share attributable to common stockholders |
|
|
|
|
|
|
| ||||||||
Basic | $ | 0.29 |
| $ | 0.32 |
|
| $ | 0.51 |
| $ | 0.53 |
| ||
Diluted | $ | 0.28 |
| $ | 0.30 |
|
| $ | 0.50 |
| $ | 0.50 |
| ||
|
|
|
|
|
|
|
| ||||||||
Weighted-average shares used to compute net income per share attributable to common stockholders |
|
|
|
|
|
|
| ||||||||
Basic |
| 70,001 |
|
| 72,955 |
|
|
| 70,867 |
|
| 74,221 |
| ||
Diluted |
| 71,607 |
|
| 76,054 |
|
|
| 73,402 |
|
| 78,616 |
| ||
|
|
|
|
|
|
|
| ||||||||
(1) Includes stock-based compensation expense as follows: | |||||||||||||||
| Three Months Ended |
| Year Ended | ||||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | ||||||||
Cost of revenue | $ | 1,060 |
| $ | 1,029 |
|
| $ | 4,761 |
| $ | 4,302 |
| ||
Sales and marketing |
| 8,160 |
|
| 7,703 |
|
|
| 33,621 |
|
| 32,335 |
| ||
Product development |
| 20,090 |
|
| 19,817 |
|
|
| 86,871 |
|
| 81,624 |
| ||
General and administrative |
| 7,027 |
|
| 6,584 |
|
|
| 30,837 |
|
| 33,418 |
| ||
Total stock-based compensation | $ | 36,337 |
| $ | 35,133 |
|
| $ | 156,090 |
| $ | 151,679 |
|
YELP INC. CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited) | |||||||
| Year Ended December 31, | ||||||
| 2022 |
| 2021 | ||||
Operating Activities |
|
|
| ||||
Net income | $ | 36,347 |
|
| $ | 39,671 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
| ||||
Depreciation and amortization |
| 44,852 |
|
|
| 55,683 |
|
Provision for doubtful accounts |
| 25,006 |
|
|
| 14,574 |
|
Stock-based compensation |
| 156,090 |
|
|
| 151,679 |
|
Noncash lease cost |
| 32,810 |
|
|
| 39,339 |
|
Deferred income taxes |
| (56,621 | ) |
|
| (9,190 | ) |
Amortization of deferred contract cost |
| 18,827 |
|
|
| 14,613 |
|
Asset impairment |
| 10,464 |
|
|
| 11,164 |
|
Noncash gain on lease termination |
| — |
|
|
| (11,485 | ) |
Other adjustments, net |
| 1,036 |
|
|
| 392 |
|
Changes in operating assets and liabilities: |
|
|
| ||||
Accounts receivable |
| (49,555 | ) |
|
| (33,535 | ) |
Prepaid expenses and other assets |
| (36,032 | ) |
|
| (49,246 | ) |
Operating lease liabilities |
| (40,057 | ) |
|
| (41,008 | ) |
Accounts payable, accrued liabilities and other liabilities |
| 49,142 |
|
|
| 30,004 |
|
Net cash provided by operating activities |
| 192,309 |
|
|
| 212,655 |
|
|
|
|
| ||||
Investing Activities |
|
|
| ||||
Purchases of marketable securities — available-for-sale |
| (127,080 | ) |
|
| — |
|
Sales and maturities of marketable securities — available-for-sale |
| 32,821 |
|
|
| — |
|
Purchases of property, equipment and software |
| (31,979 | ) |
|
| (28,282 | ) |
Other investing activities |
| 94 |
|
|
| 632 |
|
Net cash used in investing activities |
| (126,144 | ) |
|
| (27,650 | ) |
|
|
|
| ||||
Financing Activities |
|
|
| ||||
Proceeds from issuance of common stock for employee stock-based plans |
| 23,497 |
|
|
| 24,984 |
|
Taxes paid related to the net share settlement of equity awards |
| (61,023 | ) |
|
| (62,545 | ) |
Repurchases of common stock |
| (200,006 | ) |
|
| (262,928 | ) |
Net cash used in financing activities |
| (237,532 | ) |
|
| (300,489 | ) |
|
|
|
| ||||
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
| (2,136 | ) |
|
| (415 | ) |
|
|
|
| ||||
Change in cash, cash equivalents and restricted cash |
| (173,503 | ) |
|
| (115,899 | ) |
Cash, cash equivalents and restricted cash — Beginning of period |
| 480,641 |
|
|
| 596,540 |
|
Cash, cash equivalents and restricted cash — End of period | $ | 307,138 |
|
| $ | 480,641 |
|
Non-GAAP Financial Measures
This press release and statements made during the above referenced webcast may include information relating to Adjusted EBITDA and Adjusted EBITDA margin, 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 restructuring costs, impairment charges and net gain on lease termination. We define Adjusted EBITDA margin as Adjusted EBITDA divided by net revenue.
Adjusted EBITDA, which is not prepared under any comprehensive set of accounting rules or principles, has limitations as an analytical tool and you should not consider it in isolation or as a substitute 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 should not be viewed as a substitute for, or superior to, net income (loss) prepared in accordance with GAAP as a measure of profitability or liquidity. Some of these limitations are:
Because of these limitations, you should consider Adjusted EBITDA and Adjusted EBITDA margin alongside other financial performance measures, net income (loss) 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 |
| Year Ended | ||||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | ||||||||
Reconciliation of Net Income to Adjusted EBITDA: |
|
|
|
|
|
|
| ||||||||
Net income | $ | 20,145 |
|
| $ | 23,190 |
|
| $ | 36,347 |
|
| $ | 39,671 |
|
Provision for (benefit from) income taxes |
| 16,717 |
|
|
| (2,971 | ) |
|
| 30,431 |
|
|
| (5,953 | ) |
Other income, net |
| (3,478 | ) |
|
| (626 | ) |
|
| (8,425 | ) |
|
| (2,204 | ) |
Depreciation and amortization |
| 10,687 |
|
|
| 17,140 |
|
|
| 44,852 |
|
|
| 55,683 |
|
Stock-based compensation |
| 36,337 |
|
|
| 35,133 |
|
|
| 156,090 |
|
|
| 151,679 |
|
Restructuring |
| — |
|
|
| — |
|
|
| — |
|
|
| 32 |
|
Asset impairment (1) |
| — |
|
|
| — |
|
|
| 10,464 |
|
|
| 11,164 |
|
Gain on lease termination, net (1) |
| — |
|
|
| (3,748 | ) |
|
| — |
|
|
| (3,748 | ) |
Adjusted EBITDA | $ | 80,408 |
|
| $ | 68,118 |
|
| $ | 269,759 |
|
| $ | 246,324 |
|
|
|
|
|
|
|
|
| ||||||||
Net revenue | $ | 309,103 |
|
| $ | 273,400 |
|
| $ | 1,193,506 |
|
| $ | 1,031,839 |
|
Net income margin |
| 7 | % |
|
| 8 | % |
|
| 3 | % |
|
| 4 | % |
Adjusted EBITDA margin |
| 26 | % |
|
| 25 | % |
|
| 23 | % |
|
| 24 | % |
(1) | Recorded within general and administrative expenses on our condensed consolidated statements of operations. |
View source version on businesswire.com:https://www.businesswire.com/news/home/20230209005657/en/
CONTACT: Investor Relations Contact:Kate Krieger
ir@yelp.comPress Contact:Amber Albrecht
press@yelp.com
KEYWORD: CALIFORNIA UNITED STATES NORTH AMERICA
INDUSTRY KEYWORD: SOFTWARE RESTAURANT/BAR ONLINE RETAIL INTERNET SOCIAL MEDIA APPS/APPLICATIONS TECHNOLOGY FOOD/BEVERAGE RETAIL MARKETING ADVERTISING COMMUNICATIONS
SOURCE: Yelp Inc.
Copyright Business Wire 2023.
PUB: 02/09/2023 04:05 PM/DISC: 02/09/2023 04:04 PM
http://www.businesswire.com/news/home/20230209005657/en