YELP INC Q1 FY2025 earnings call

Key Points - Services business saw 8% year-over-year revenue growth, with Services revenue up 14% y-o-y to $232 million. - Request to Quote projects increased ~10% y-o-y, excluding paid search projects, growth was over 15% y-o-y. - Introduced new features like AI-powered photo recognition in Yelp Assistant, response quality badges for service pros. - Integrated with Zapier to connect Yelp to over 800 CRM platforms. - Leveraged AI to improve matching algorithms, ad formats, and consumer AI-powered business summaries. - Announced AI-powered call answering services for service pros and restaurants to help manage incoming calls.

In the first quarter, Yelp's Services revenue was $232 million, representing an 14% year-over-year increase. RR&O revenue was $110 million, a 3% year-over-year decline. Services revenue growth was driven by continued strength in the services business, while RR&O faced challenges due to macroeconomic pressures.

Guidance - Second quarter net revenue expected to be in the range of $362 million to $367 million. - Full year net revenue now expected to be between $1.465 billion and $1.485 billion. - Second quarter adjusted EBITDA expected to be in the range of $84 million to $89 million. - Full year adjusted EBITDA expected to be between $345 million and $365 million.

Risks - Macro-economic and policy uncertainties impacting advertiser spend. - Continued headwinds in the RR&O category affecting multi-location revenue. - Potential impact of inflation and supply chain disruptions on business performance.

Q: Sergio Segura asked about quarter-to-date trends and vertical perspectives, with a focus on advertiser sentiment and macro environment.

A: Jeremy Stoppelman noted Q1 was resilient, services continued well with 14% growth, multi-location RR&O advertisers are cautious but multi-location services initiative shows positive signs.

Q: Kyle asked about Yelp Assistant adoption despite lower paid search budget.

A: Jeremy Stoppelman said Yelp Assistant has room for growth, new entry points and expansion to more categories are planned.

Q: Brian asked about broader AI strategy and early incrementality.

A: Jeremy Stoppelman discussed AI applications like Yelp Assistant with photo recognition, intelligent matching, and upcoming call answering services.

Q: Nitin Bansal asked about engagement trends and RepairPal monetization.

A: Jeremy Stoppelman mentioned consumer engagement trends with services growth and RepairPal integration progress with upcoming features.