EX-99.1 2 yelpq2-21ex991pressrelease.htm EX-99.1 Document

EXHIBIT 99.1

Yelp Reports Second Quarter 2021 Financial Results

Second quarter Net revenue grew 52% year over year to $257 million, resulting in a positive Net income of
$4 million

Adjusted EBITDA increased by 473% year over year to a record $64 million

Raises full year outlook to $1.01 billion to $1.03 billion of Net revenue and $200 million to $220 million of Adjusted EBITDA1

Board of Directors authorized $250 million increase to stock repurchase program

SAN FRANCISCO--(BUSINESS WIRE)--August 5, 2021--Yelp Inc. (NYSE: YELP), the company that connects people with great local businesses, today posted its financial results for the second quarter ended June 30, 2021 in the Q2 2021 Shareholder Letter available on its Investor Relations website at www.yelp-ir.com.

“The Yelp of 2021 looks very different than it did when we began implementing our strategic initiatives in 2019, as we continue to connect consumers with local businesses through trusted content and reviews,” said Jeremy Stoppelman, Yelp co-founder and CEO. “We elevated the pace of product innovation, and made significant progress on our plan to drive advertising revenue growth from our Services categories as well as our Self-serve and Multi-location channels. This consistent execution of our multi-year strategy has transformed Yelp into a structurally stronger business.”

“Our strong second quarter results give us the confidence to raise our full-year outlook,” said David Schwarzbach, Yelp’s CFO. “We achieved 52% year-over-year revenue growth and record Adjusted EBITDA, even as we invested behind our initiatives. We continue to see a broad set of opportunities to drive significant returns and shareholder value in 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.

Quarterly Conference Call
Yelp will host a live Q&A session today at 2:00 p.m. Pacific Time to discuss the second quarter financial results and outlook for the third quarter and full year of 2021. The webcast of the Q&A can be accessed on the Yelp Investor Relations website at www.yelp-ir.com. A replay of the webcast will be available at the same website.
About Yelp
Yelp Inc. (www.yelp.com) connects people with great local businesses. With unmatched local business information, photos, and review content, Yelp provides a one-stop local platform for consumers to discover, connect, and transact with local businesses of all sizes by making it easy to request a quote, join a waitlist, and make a reservation, appointment, or purchase. Yelp was founded in San Francisco in July 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 opportunities to drive significant returns and shareholder value in the long term, 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:

•fluctuations in the number of COVID-19 cases, the pace at which vaccinations are administered in the United States, and the timeframe for the lifting of COVID-19-related shelter-in-place orders and business restrictions;
•the pace of reopening and recovery by local economies and economic recovery in the United States generally;
•Yelp’s ability to maintain and expand its base of advertisers, particularly as many businesses continue to face operating restrictions in connection with the COVID-19 pandemic and other constraints;
•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 or Quarterly Report on Form 10-Q at www.yelp-ir.com or the SEC’s website at www.sec.gov.

Investor Relations Contact:
Kate Krieger
ir@yelp.com

Press Contact:
Amber Albrecht
press@yelp.com



YELP INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
June 30,
2021		December 31,
2020
Assets
Current assets:
Cash and cash equivalents$558,227 $595,875 
Accounts receivable, net
101,542 88,400 
Prepaid expenses and other current assets29,413 28,450 
Total current assets689,182 712,725 
Property, equipment and software, net92,627 101,718 
Operating lease right-of-use assets143,617 168,209 
Goodwill107,630 109,261 
Intangibles, net12,095 13,521 
Restricted cash1,027 665 
Other non-current assets59,066 48,848 
Total assets$1,105,244 $1,154,947 
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued liabilities$106,190 $87,760 
Operating lease liabilities — current47,858 51,161 
Deferred revenue5,175 4,109 
Total current liabilities159,223 143,030 
Operating lease liabilities — long-term134,448 148,935 
Other long-term liabilities
8,109 8,448 
Total liabilities301,780 300,413 
Stockholders' equity:
Common stock
— — 
Additional paid-in capital1,464,490 1,398,248 
Treasury stock(4,250)(2,964)
Accumulated other comprehensive loss(8,378)(6,807)
Accumulated deficit(648,398)(533,943)
Total stockholders' equity803,464 854,534 
Total liabilities and stockholders' equity$1,105,244 $1,154,947 





YELP INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Three Months Ended
June 30,		Six Months Ended
June 30,
2021202020212020
Net revenue$257,188 $169,030 $489,284 $418,931 
Costs and expenses:
Cost of revenue (1)
17,993 11,825 32,867 28,672 
Sales and marketing (1)
113,641 96,289 226,550 233,586 
Product development (1)
68,695 53,969 136,687 121,082 
General and administrative (1)
45,095 26,402 76,956 69,938 
Depreciation and amortization12,833 12,582 25,916 24,940 
Restructuring12 3,312 32 3,312 
Total costs and expenses258,269 204,379 499,008 481,530 
Loss from operations(1,081)(35,349)(9,724)(62,599)
Other income, net542 495 1,247 2,878 
Loss before income taxes(539)(34,854)(8,477)(59,721)
Benefit from income taxes(4,751)(10,864)(6,893)(20,228)
Net income (loss) attributable to common stockholders$4,212 $(23,990)$(1,584)$(39,493)
Net income (loss) per share attributable to common stockholders
Basic$0.06 $(0.33)$(0.02)$(0.55)
Diluted$0.05 $(0.33)$(0.02)$(0.55)
Weighted-average shares used to compute net income (loss) per share attributable to common stockholders
Basic74,807 72,413 75,025 71,980 
Diluted78,983 72,413 75,025 71,980 
(1) Includes stock-based compensation expense as follows:
Three Months Ended
June 30,		Six Months Ended
June 30,
2021202020212020
Cost of revenue$1,094 $943 $2,202 $1,986 
Sales and marketing8,441 7,302 16,838 14,998 
Product development20,674 16,827 41,427 34,582 
General and administrative10,650 5,513 19,637 10,769 
Total stock-based compensation$40,859 $30,585 $80,104 $62,335 



YELP INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Six Months Ended
June 30,
20212020
Operating Activities
Net loss$(1,584)$(39,493)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization25,916 24,940 
Provision for doubtful accounts7,240 21,897 
Stock-based compensation80,104 62,335 
Noncash lease cost20,712 20,984 
Deferred income taxes(7,755)(14,263)
Asset impairment11,164 — 
Other adjustments, net386 876 
Changes in operating assets and liabilities:
Accounts receivable(20,382)12,910 
Prepaid expenses and other assets88 604 
Operating lease liabilities(22,489)(22,520)
Accounts payable, accrued liabilities and other liabilities15,707 (11,021)
Net cash provided by operating activities109,107 57,249 
Investing Activities
Sales and maturities of marketable securities — available-for-sale— 290,395 
Purchases of marketable securities — held-to-maturity— (87,438)
Maturities of marketable securities — held-to-maturity— 93,200 
Purchases of property, equipment and software(13,286)(17,004)
Other investing activities90 328 
Net cash (used in) provided by investing activities(13,196)279,481 
Financing Activities
Proceeds from issuance of common stock for employee stock-based plans15,587 10,808 
Taxes paid related to the net share settlement of equity awards(34,824)(12,557)
Repurchases of common stock(114,157)— 
Other financing activities— (356)
Net cash used in financing activities(133,394)(2,105)
Effect of exchange rate changes on cash, cash equivalents and restricted cash197 (340)
Change in cash, cash equivalents and restricted cash(37,286)334,285 
Cash, cash equivalents and restricted cash — Beginning of period596,540 192,318 
Cash, cash equivalents and restricted cash — End of period$559,254 $526,603 



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 and impairment charges. 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:

•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 any income or costs that management determines are not indicative of ongoing operating performance, such as restructuring costs and impairment charges; and
•other companies, including those in Yelp’s industry, may calculate Adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

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 (loss) to Adjusted EBITDA, as well as the calculation of net income (loss) margin and Adjusted EBITDA margin, for each of the periods indicated (in thousands, except percentages; unaudited):
Three Months Ended
June 30, 2021March 31, 2021June 30, 2020June 30, 2019
Reconciliation of Net Income (Loss) to Adjusted EBITDA:
Net income (loss)$4,212 $(5,796)$(23,990)$12,303 
(Benefit from) provision for income taxes(4,751)(2,142)(10,864)3,785 
Other income, net(542)(705)(495)(3,891)
Depreciation and amortization12,833 13,083 12,582 12,240 
Stock-based compensation40,859 39,245 30,585 30,452 
Restructuring12 20 3,312 — 
Asset impairment(1)
11,164 — — — 
Adjusted EBITDA$63,787 $43,705 $11,130 $54,889 
Net revenue$257,188 $232,096 $169,030 $246,955 
Net income (loss) margin2 %(2)%(14)%5 %
Adjusted EBITDA margin25 %19 %7 %22 %
(1) Recorded within general and administrative expenses on our Condensed Consolidated Statements of Operations.