Welcome everyone. Yelp Inc. delivered record net revenue and strong profitability in 2024 as we executed against our product-led strategy. We accelerated our pace of innovation, introducing more than eighty new features and updates. Services was the focus of our road map and the driver of our business performance. In the fourth quarter, we achieved our fifteenth consecutive quarter of double-digit year-over-year revenue growth in these categories. Overall, in 2024, net revenue increased by 6% year over year to $1.41 billion. Through disciplined expense management, we grew net income by 34% year over year to $133 million and adjusted EBITDA by 8% year over year to $358 million. We also expanded net income margin by two percentage points and adjusted EBITDA margin by one percentage point from 2023. Underlying our top-line results, we saw a divergence in performance across categories. Businesses in our restaurant, retail, and other categories faced a challenging operating environment, and RRNO revenue declined by 3% year over year to $470 million as a result. At the same time, services were consistently strong, with revenue up 11% year over year to a record $879 million. The home services category was the standout in 2024 with annual revenue growth of approximately 15% year over year. We launched a number of new products and features to facilitate even better connections between consumers and service pros. Our new AI chatbot, Yelp Assistant, has particularly resonated with consumers, with project submissions through this feature up by more than 50% from the third to fourth quarter. We also experimented with acquiring services projects off Yelp through paid search and saw strong top-of-funnel results. That said, we ultimately reduced our spend on this initiative as it did not provide our desired return, reflecting our disciplined approach to investment. Overall, engagement with Request a Quote was robust in 2024. Consumer projects increased by approximately 25% year over year, primarily as a result of organic improvements. This includes growth of approximately 30% year over year in the fourth quarter despite minimal spending on paid search during the period. Improved matching and ad formats delivered value to advertisers in the form of more clicks at compelling prices in 2024. We introduced smart selection, an AI-powered feature for advertisers that optimizes their ads automatically, selecting the best reviews and photos to showcase. These efforts contributed to a 6% year-over-year increase in ad clicks and flat average CTCs for the year. On the consumer side of our business, we rolled out a number of new features and updates to enhance the Yelp experience and drive user engagement. These include AI-powered search features, review insights leveraging LLMs, and enhanced user-generated videos on the home feed. We also made a number of back-end and user experience improvements to our mobile and desktop websites that led to a combined year-over-year increase in page views on these platforms. While our overall traffic levels were relatively flat compared to 2023, we continue to grow our large set of trusted review content. Yelp users contributed 21 million new reviews in 2024, reaching a total of 308 million cumulative reviews, up 7% from the prior year. Looking to 2025, we plan to build on our position as a trusted platform for consumers to discover and connect with great local businesses. To achieve this, we plan to invest in three strategic initiatives: lead in services, drive advertiser value, and transform the consumer experience. Underlying each investment area, we can accelerate our strategy with AI, which we believe we are well-positioned to leverage based on our high-quality trusted content and deep technical capabilities. Services categories will be the major focus of our product-led strategy in 2025. We have historically focused our efforts on the home services category, which has been our largest driver of growth in services for the past decade. We see an additional opportunity to drive growth among other top services categories. In particular, following our acquisition of RepairPal in November, we expect to accelerate growth in the auto services category this year. We also believe that our increased product focus and sales efforts for multilocation services businesses position us well to capture more demand from these advertisers in 2025. Overall, our 2025 services road map aims to create a best-in-class experience for consumers and service pros. We are excited by the opportunities ahead as we expand the Yelp Assistant and leverage AI more broadly to reduce friction throughout the hiring journey. In addition to raising the bar in services, we have a portfolio of product and marketing initiatives designed to deliver value to both advertisers and consumers. We plan to further develop our advertising technology and products to match consumers and advertisers even more efficiently. This includes providing advertisers with additional AI-powered controls and recommendations to help further refine ad targeting. We also plan to continue leveraging AI to transform the consumer experience, including creating a more dynamic and personalized home feed as well as an even more seamless search experience. In summary, our focus on services continues to strengthen our business, and we are excited by the opportunities ahead to drive profitable growth and shareholder value over the long term. With that, I'll turn it over to David. Thanks for that full-year overview.

I will now turn to our fourth-quarter results. Net revenue increased by 6% year over year to $362 million, $13 million above the midpoint of our outlook range. Driven by our disciplined approach, net income increased by 54% year over year to $42 million, representing a 12% margin. Adjusted EBITDA increased by 5% year over year to $101 million, $15 million above the midpoint of our outlook range, representing a 28% margin. As Jeremy mentioned, top-line growth was driven by continued strength in services categories throughout the year. Advertising revenue in services increased by 11% year over year in the fourth quarter to $225 million. Conversely, restaurants and retailers remained pressured during the quarter, resulting in a 3% year-over-year decline in RRNO revenue to $121 million. A decrease in RRNO locations also resulted in an overall decline of 4% year over year in paying advertising locations to 521,000. We also focused on driving growth through our most efficient channels. Self-serve was strong and grew approximately 15% year over year in the quarter. At the same time, multilocation revenue came in approximately flat year over year, reflecting continued softness in RRNO. Turning to expenses for the year, 2024 was a clear demonstration of our commitment to disciplined expense management. Excluding RepairPal employees, we ended the year with approximately flat headcount compared to 2023. In addition, when our paid search spend did not meet our desired returns, the subsequent reduction in marketing expense flowed through to our bottom line. Ultimately, we increased net income margin by two percentage points and adjusted EBITDA margin by one percentage point from the prior year. As we look to 2025, we plan to continue our disciplined approach and hold headcount flat once again as we drive growth through our product-led strategy. We also remain focused on increasing the quality of adjusted EBITDA. In recent years, we have taken significant actions to shift our compensation mix between stock and cash, including substantially reducing the number of shares granted to employees in 2024. While we expect the full impact of these efforts to stack over time, in 2024, we were able to reduce stock-based compensation expense as a percentage of revenue by two percentage points. Coupled with continued share repurchases throughout the year, we decreased our shares outstanding and increased diluted earnings per share by 40% year over year to $1.88. As we look ahead, we continue to expect that stock-based compensation expense will be reduced to less than 8% of revenue by the end of the year. In addition, we now plan to reduce stock-based compensation to less than 6% of revenue by the end of 2027. Our capital allocation strategy consists of three main elements: first, maintaining a healthy cash balance to fund our operations; second, retaining capacity for potential acquisitions; and third, returning excess capital to shareholders through share repurchases. In 2024, we acquired auto services platform RepairPal for approximately $80 million in cash, demonstrating our ability to deploy balance sheet capital in support of our business strategy. We also repurchased $251 million worth of shares at an average purchase price of $37.52 per share, including $62.5 million worth of shares repurchased in the fourth quarter. As of December 31, 2024, we had $331 million remaining under our existing repurchase authorization. We plan to continue repurchasing shares in 2025, subject to market and economic conditions. Turning to our outlook, we continue to believe in the significant long-term growth opportunities ahead as we focus our investments on high-return areas that we believe will drive increased profitability. As we look to 2025, we expect the category trends that characterized 2024 to persist. Specifically, we expect services will continue to drive our business performance and RRNO will remain pressured. As a result, for the first quarter of 2025, we expect net revenue will be in the range of $350 million to $355 million, reflecting typical seasonality. For the full year, we expect net revenue will be in the range of $1.470 billion to $1.485 billion. Turning to margin, we expect expenses to increase seasonally from the fourth quarter of 2024 to the first quarter of 2025, primarily driven by payroll taxes and benefits. As a result, we expect first-quarter adjusted EBITDA will be in the range of $65 million to $70 million.

For the full year, we anticipate expenses will increase modestly. Primarily as a result of higher cost of revenue, driven in part by our RepairPal acquisition. We also expect our efforts to reduce stock-based compensation expense to continue to act as a headwind to adjusted EBITDA, but will not impact net income. As a result, we expect adjusted EBITDA for the full year to be in the range of $345 million to $360 million. In closing, Yelp's 2024 results reflect the underlying profitability of our business. We continue to believe in the opportunities ahead to create shareholder value over the long term as we focus our investments in areas that we believe will drive business performance. With that, operator, please open up the line for questions.

Thank you, sir. And everyone, if you would like to ask a question, please press star one. We'll go first to Eric Sheridan, Goldman Sachs.

Thank you so much for taking the questions. Maybe two if I could. Just in terms of RRNO, how much are there abilities for you as a company to sort of invest behind demand generation and maybe take advantage of competition or take market share in local as opposed to the broader macro environment and some tougher comps generally being sort of a driver of what might happen to that business when you look out over the next six to twelve months? And then just to put a finer point on your prepared remarks, I want to know if you could just sort of dovetail with what you see as the key investment areas needed to produce similar or better levels of growth in the services side of the business as you look out to not only just 2025 but beyond. Thanks so much.

Hi, Eric. This is Jed. I can take the first part of the question regarding RRNO. Obviously, the last year or so has been we've seen some headwinds with RRNO. You know, inflationary pressures on both the consumer as well as the operators' input costs, labor costs. And, you know, in terms of being able to drive demand, we do continue to invest in the business. And you know, when you look at relationships that we continue with on the multilocation side, the product investment, products like You, Spotlight, Showcase. You know, we are there for when this market turns. In terms of kind of driving demand that doesn't exist in the marketplace, I think our focus is really on services. And we've aligned the go-to-market team around that. And certainly, we've aligned the product road map around that. We're really bullish on the prospects moving forward. So, you know, when the market turns, we will be prepared to capture that opportunity in RRNO, but really the focus right now is on services.

Okay, Eric. I'll hop in here for the second half of your question. You know, services in 2024, obviously, a great story there, up 11% year over year. Home services, even faster, 15% year over year. Coming into 2025 with great momentum. And, you know, another thing we mentioned that you may have noticed in Q4, you know, we saw a really great performance out of Request a Quote. Projects were up 30% year over year. Overall, for the year, it was 25%. That gives us some confidence in what we're doing, and services is really working. We intend to lean in there. We know that there's a multilocation services opportunity. You know, last year, you know, we put out there a leads API to make it a lot easier for these larger advertisers to tap into Request a Quote. Something that, you know, a lot of them haven't been doing, and that's where a lot of our value has been flowing. So excited to see that play out. And then beyond home services, we've also got obviously other categories that we're starting to really lean into that's exciting for me personally. The RepairPal acquisition being the most obvious example, auto moving from number three category to our number two category. So that's one that's top of mind as we do the integrations, pick some of the low-hanging fruit there. And then, of course, there's other categories like local, professional services, and the list goes on in terms of opportunity for us. So pretty excited to see how it holds in 2025 and beyond. Thank you.

Next up, we'll take a question from Jason Kreyer, Craig Hallum.

Great. Thank you, guys. So maybe picking up where that left off. Just on the multilocation, you were talking about the leads API. And this is in services specifically, by the way. But you talk about other investments you can make there? And then with that representing 20% of that business today, where do you think that can go over time?

Hi, Jason. This is Jed. I can take that question. You know, as you know, we've, as a company, been focused on services, you know, for the last few years. And really not until the beginning of the last year did we start putting the resourcing towards, you know, the services opportunity. To better service these multilocation businesses. You know, an area where, you know, as you alluded to, we are underpenetrated and believe there's a lot of headroom. You know, there's work being done on both the product and go-to-market sides. Jeremy mentioned some of the work we've been doing on the leads API. We've also revamped our internal BOA for our business owner's account for those customers that don't have a homegrown business owner's account, so that they can manage leads in a more efficient way. And you know, we're still in the relatively early stage of adoption, but we're seeing a lot of promise from the partners that we've been working with thus far. You know, it is a longer sales cycle, and not only a longer sales cycle, but you have to oftentimes, you know, really get into the processes that these folks have for managing leads. And so it takes a little bit of change management in order to get that done. We're also pushing really hard on, you know, the quality of responses from these multilocation pros. You know, it does represent a different way of handling leads in a lot of cases. But we've been very encouraged thus far with the feedback that we've gotten and believe that opportunity is a big one for us going forward.

Thank you. And I wanted to follow up with a question just on AI. You've launched a bunch of new solutions and features there. If you look back at these updates over the past year, in what ways do those benefits manifest in the business? Like, are these driving cost efficiencies or are you driving more, like, consumer frequency? Just any more details on the benefit that would be great.

Thanks for the question. This is Jeremy. I'll hop in here. We see benefits all across the business. Obviously, it's there on the consumer product, making it easier for users to digest all the incredible trusted information that we have. I would say from a functionality standpoint, you know, the most impactful one that we could point to would be Yelp Assistant, which is a conversational AI that allows you to talk about what is your service need. You know, if you've got a leaky faucet or what have you, it walks you through that process. It asks you the relevant questions, and it sets it all back to you, says, is this what we're talking about in the end, and then goes on to connect you with pros. And we have seen a lift in terms of projects submitted as people started using that flow. The previous flow obviously was less efficient. Request a Quote used to be, you know, a series of menus that you would have to work through. Now it's an easy conversation. So that's really great to see. And this functionality, of course, can be extended both to more places throughout the app as well as to other categories. You know, I'm not sure that there's any category on Yelp that wouldn't be a fit. And so it's just a matter of time and execution to work this into Yelp to really transform the consumer experience. And I think quite a profound way. You know, on the back end, there's also a lot of effort opportunity. We've seen wins directly coming from AI. So improved ad matching. You know, there's operational things like handling AI. You know, LLMs, you know, play a big role now in writing software, making engineers more efficient. On the user operation side, you can moderate content. So there's just so many facets of our business that are touched by AI. You know, it still feels like we're in the early innings here. So really an exciting technology and something that we're, you know, thinking about every day and incorporating into our business everywhere we can.

From KeyBanc. Sergio Segura has the next question.

Great. Thanks for taking the questions. Maybe first to start off with a high-level one, we'd love to hear just updated thoughts on views of Yelp's positioning in the current environment just given the rapid changes we are seeing across the broader search and AI landscape. So that's number one. And then the second question, I guess, maybe if you could just give more color on the drivers about performance this quarter versus, you know, the expectations within your guidance. And I guess the full-year guide has revenue decelerating from this year's exit rates. Maybe just dive into the details there. Why do you have a full-year guide decelerating? Is that just some conservatism or anything else we should think about with this lower growth rate within the guide for 2025? Thank you.

Hi, Sergio. This is Jeremy. I'll take the first half there. With respect to Yelp and AI-powered search, you know, I think it's a really exciting opportunity to reinvent the search experience. You have a lot of new players, some of which are already tapping into Yelp's content. You know, having trusted human-written helpful content, millions of reviews, I think, is a really important ingredient in a success for a successful search engine. You've got to handle local queries, local intent. At least for Google, it's something like half of their queries. So that means you need a solution. And if you're not Google competing directly with us, you're probably having a conversation with Yelp at some point. So I think that's a great starting point. And then there's the question of, well, what are we doing with the Yelp experience? And, you know, I was just previously talking about Yelp Assistant and how we're using that to begin a transformation of the search experience, have something more conversational. We're in the very early innings of that transformation, but I think it's a powerful one. It should, you know, allow us to create a very unique experience, especially within local. And then, of course, we can take that and wrap it in an API and provide that to any other AI agent out there that might want to tap into useful local content or send through a Request a Quote, you know, working with our Yelp Assistant technology, whether it's a search engine, an AI agent, or just another web or app property that wants to tap into local information. I think there'll be opportunities that didn't exist before. So that's a really exciting time for Yelp.

Sergio, just in terms of turning to the full-year guide, on Q4, we were broadly better. We were pleased with that. What we had said on the Q3 call when we gave guidance for Q4 was we did not expect to see the typical seasonal increase in some of the spend in RRNO. We did actually see some of that occur, so that's a key element as well. So business, broadly better plus some seasonal think it's worth pointing out that as we outperformed on revenue, we were able to flow all of that through to adjusted EBITDA. EBITDA margin at 28%, $101 million to match Q3. We thought was really strong. And, again, just underscores our continued discipline in the way that we operate the business.

In terms of the guidance for 2025, I would just underscore it is definitely reflecting risks and uncertainties. As we have come into the year, in particular this week, as we saw with both the CPI print and the PPI print, inflation has picked up a bit more, and there's broadly a range of uncertainties with regard to just policies that may be enacted. So we're reflecting that in the guidance since it's very early in the year. But, overall, as we came out of 2024 and came into 2025, we're really pleased with the momentum in the business, particularly in the services side of the business. Of course, that grew 11% in the fourth quarter and 11% for all of 2024. That fourth-quarter growth performance was the fifteenth quarter of double-digit growth in services, and so we're really pleased with the way that we came into 2025. We're gonna execute against the product road map. And, obviously, as we go through the year, we'll look forward to providing more updates.

We'll take the next question today from Shweta Khajuria, Wolfe Research.

Thank you for taking my questions. I have two, please. The first one is what is baked into your guide of what is RepairPal's contribution that's baked into your guide for Q1 and for full-year revenue? And then the second one is, in your Q1 guide, could you please give us a little bit more color in terms of the impact of LA fires if you saw any and Leap Day? Thanks a lot.

Hi, Shweta. So I'll answer your second question first and then the first question second. In terms of LA fires and Leap Day, obviously, the Leap Day one is gonna bear out in the numbers directly on the year-on-year comp basis. But on the LA fires, we actually saw minimal impact from the fires in terms of both budget and revenue performance in January. So overall, that hasn't been a factor. In terms of RepairPal going forward, we do not plan to separately break out RepairPal as we report. Obviously, we're pleased with the acquisition. The team landed. They're performing well. They're getting on board. And we believe that there's significant opportunity for us broadly in auto. I think this is really the theme for us for 2025. We've obviously actually for a long period of time. We're really pleased with the progress that we've made there. And now with auto as our second-largest category with RepairPal on board, there are things that we think that we can do to help accelerate their business. And there are things that come from RepairPal that we think that will have a positive impact on the auto category on Yelp itself. So overall, that's meeting our expectations as they stand very early. But beyond that, there is more for us to do across additional categories in services, whether it's local services or professional services, we see significant opportunities. And we just think that with our product-led growth strategy, we can continue to really deliver. Our ambition is to deliver the best experience in services, and we're doing a lot of work there to continue to drive that, including, as Jeremy already mentioned, looking for ways to continue to improve the system to deliver value to consumers and pros alike.

Okay. Thanks, David. The next question today is Kishan Patel, Raymond James.

Hi there. I'm sitting in for Josh Beck. Could you provide some color on traffic driven by Perplexity and whether you're seeing search results ranking notably different than on Google search? And, also, how would you characterize the conversations with other Gen AI search platforms? Are you seeing more activity on that front, whether in terms of data licensing deals or driving traffic to Yelp?

Hi, Kishan. This is Jeremy. I'll hop in here. Yeah. Obviously, with Perplexity, it's a start-up. It's still very early. So nothing material to report there. You know, you can find Yelp content and links as you peruse the Perplexity experience. But this is a new space. And so, you know, everything's changing fast. The interface that they have one day is different the next day. So it's kind of a space to watch is how I would describe it. As far as other folks interested in the content, I would say there's absolutely lots of folks having conversations with us, you know, both directly in the AI category as well as lots of other categories. Because we have such great content. Hundreds of millions of reviews, human-written, trusted, and that's really important. For a variety of reasons, but especially if you're trying to steer people to local businesses as part of your search or answer experience. So, obviously, nothing to report out today. But, you know, we're always talking to people, and we're excited about this area in general. And then I guess, to the other part of your question, have you seen anything new and different on the Google side? And I would say nothing to report there. You know, certainly, search traffic, traditional SEO, is a portion of our engagement, but haven't seen any serious volatility, anything out of the ordinary.

Appreciate that. That's a follow-up if I may. Given the moderation in paid search during the second half, how do you think about your ad budgets and priority setting into 2025?

So on just overall on marketing, I just underscore again, this is David. Our approach is very, very disciplined from a return on ad spend. And so as we went through the year and were not seeing the return that we expected on paid search, we dialed that down. That doesn't mean that there aren't other opportunities across marketing for us. It also doesn't mean that we won't spend anything on paid consumer project acquisition. So overall, we continue to experiment. We continue to spend in areas that are productive for us on the marketing front. And we think that we are spending very efficiently even as we explore new ways to deploy cash to drive engagement on Yelp and I think equally important to acquire businesses to have a place on Yelp.

Thank you very much. Next up is Nitin Bansal, Bank of America.

Thank you for taking my question. I have two. Firstly, on RepairPal, how should we think about the growth of this business over the next two to three years? Also, can you share some insights on, like, the profitability of this business and how would that impact your bottom line in 2025? And secondly, like, with Google ramping AI overviews, how that is impacting your web traffic? Thank you.

I'll get your first part of the question here. You know, RepairPal, obviously, there's a focus going into the year on services, and auto was one of our top three categories. It's now top two. I think the first order of business is, you know, obviously, integrate the employees, get everyone rolling in the right direction, bring some of the special skills that Yelp has acquired over its twenty-year life to RepairPal to ensure to accelerate growth as well as take, you know, the experts that they have in auto and bring them over to help us with experiences like Request a Quote, Yelp Assistant as it pertains to the auto repair category. So I think, you know, some expectation is there definitely will be some synergies there. We're excited to see that play out. We do anticipate, you know, that that will grow and, of course, that's baked into our guidance for the year. And then we'll see how that plays out over a multiyear period. But, you know, we're very excited in general about services and the auto category as a growth driver.

This is David. Just to answer your question around profitability, what we shared when we made the acquisition was RepairPal was about breakeven. And from our perspective, the first step is obviously, as Jeremy said, to onboard them. We really want to nurture the business here. We see a significant growth opportunity. And so driving margin performance is secondary to driving top-line opportunity for us. And as Jeremy said, we've obviously reflected in the guidance on both revenue and adjusted EBITDA, the expected financial performance of RepairPal.

And I think the last part of your question was around, have we seen any Google impact on web traffic? There's always fluctuations, but as I said to the, I think, previous person, you know, we haven't seen any material or unusual shifts.

And ladies and gentlemen, just a reminder that it is star one if you have a question. We'll go next to Colin Sebastian, Baird.

Great. Thanks. Good afternoon. I mean, stepping back, given a lot of the success that you've shown in the services segment, I'm just wondering how you think about kind of sustainable long-term growth there. Is the category growing at, you know, 5% or some other number? And then you're gonna add share gains to that on top of that sustainably, or do you think about it differently?

Hey, Colin. It's David. Fifteen quarters of double-digit growth gives us confidence that we can continue to drive strong performance in services, and we see continued opportunity in home services. But if you think back to what we said when we came into 2024, it was really gonna be a focus on home services, and we did a lot with the product to continue to enhance the experience in home services. Now we have the opportunity to broaden out and do even more across more categories. And I think that's the crucial point here. Yelp has terrific content. It's trusted. We're applying AI in a lot of different ways that we think are driving a quality experience for consumers and enabling us to deliver more value to advertisers. So when you combine those things, we think that we are very well positioned to continue to drive performance in services.

Okay. Thank you. And then maybe on the restaurant or retail side, any additional color on the competitive landscape from the point of view of the food delivery platforms and other players, and if you see that changing as you look into 2025. Thank you.

Yeah. This is Jed. I can take that question. You know, largely, when we look at the headwinds that we saw in restaurant retail and other over the course of 2024, you know, we believe it's largely a macro story. Certainly, at the margins, you know, there is some, you know, the retail media networks and the delivery platforms are a factor, but not the one that we believe is driving the performance overall in the category. You know, consumers are feeling this pinch, and the frequency has gone down in terms of, you know, the number of times, for instance, that they go out to dinner. And then the operators who are actually writing the checks on the marketing side are also feeling the pinch due to, you know, the inputs into the business. And so, you know, we do believe that this will turn eventually and that we're very well positioned to take advantage when RRNO does turn the corner. And so, you know, overall, you know, we don't believe the competitive factor is the large factor. It's an overall macro story.

Okay. Thanks a lot, guys.

And at this time, there are no further questions. That does conclude our conference for today. We would like to thank you all for your participation. You may now disconnect.