YELP INC (YELP): Results of Operations and Financial Condition
YELP INC (YELP) filed an SEC Form 8-K — Results of Operations and Financial Condition. EXHIBIT 99.1 Yelp Reports Second Quarter 2026 Results Net Revenue increased by 1% year over year to $376 million Net Income decreased from the prior year to $32 million, reflecting an 8% margin Adjusted EBITDA 1 decreased 9% year over year to $91 million, reflecting a 24% margin
How this was made
The 30-second read
Why it matters
Traders can update FY 2026 revenue and Adjusted EBITDA expectations using the narrowed guidance ranges and assess whether AI-driven monetization is translating into sustainable profitability.
Market read
Fresh earnings numbers and a tightened FY outlook range create immediate inputs for valuation models and near-term positioning.
What to watch
The release highlights AI transformation progress but does not provide GAAP net income outlook due to uncertainty in reconciling items, which can complicate valuation and earnings quality assessment.
Net Revenue increased by 1% year over year to $376 million; Net Income decreased from the prior year to $32 million, reflecting an 8% margin; Adjusted EBITDA decreased 9% year over year to $91 million, reflecting a 24% margin.
Revenue growth was 1% year over year and net income and Adjusted EBITDA declined, while Other revenue nearly doubled and quarterly revenue exceeded the high end of Yelp's outlook range by $8 million.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Net revenueGAAP | $ 375,519 (In thousands) | – | 1% |
| Cost of revenueGAAP | 41,776 (In thousands) | – | – |
| Sales and marketingGAAP | 153,562 (In thousands) | – | – |
| Product developmentGAAP | 70,468 (In thousands) | – | – |
| General and administrativeGAAP | 47,865 (In thousands) | – | – |
| Depreciation and amortizationGAAP | 18,118 (In thousands) | – | – |
| Total costs and expensesGAAP | 331,789 (In thousands) | – | – |
| Income from operationsGAAP | 43,730 (In thousands) | – | – |
| Other income, netGAAP | 733 (In thousands) | – | – |
| Income before income taxesGAAP | 44,463 (In thousands) | – | – |
| Provision for income taxesGAAP | 12,811 (In thousands) | – | – |
| Net income attributable to common stockholdersGAAP | $ 31,652 (In thousands) | – | – |
| Net income marginGAAP | 8% | – | – |
| Basic net income per share attributable to common stockholdersGAAP | $ 0.57 | – | – |
| Diluted net income per share attributable to common stockholdersGAAP | $ 0.57 | – | – |
| Weighted-average shares used to compute basic net income per share attributable to common stockholdersGAAP | 55,305 (In thousands) | – | – |
| Weighted-average shares used to compute diluted net income per share attributable to common stockholdersGAAP | 55,726 (In thousands) | – | – |
| Total stock-based compensationGAAP | $ 25,749 (In thousands) | – | – |
| Adjusted EBITDAnon-GAAP | $91 million | – | decreased 9% year over year |
| Adjusted EBITDA marginnon-GAAP | 24% | – | – |
| Net cash provided by operating activitiesGAAP | 133,638 (In thousands) | – | – |
| Purchases of property, equipment and softwareGAAP | (27,409) (In thousands) | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Other revenueOther revenue accelerated from the first quarter and reached a record $33 million. | $33 million | – | 98% year over year |
2026 outlook
- Revenue$1.460 billion to $1.470 billion
- NoteAdjusted EBITDA: $315 million to $325 million
Capital returns
- Repurchases of common stock: (174,000) (In thousands) for the six months ended June 30, 2026.
- Repurchases of common stock: (128,450) (In thousands) for the six months ended June 30, 2025.
What drove it
- Other revenue increased 98% year over year to a record $33 million.
- Yelp Assistant drove early positive signs in engagement.
- Yelp Host scaled rapidly.
- Hatch accelerated its product roadmap.
- Yelp's trusted content is powering local discovery for ChatGPT and other AI partners.
Concerns
- Net Income decreased from the prior year to $32 million.
- Adjusted EBITDA decreased 9% year over year to $91 million.
- Income from operations was 43,730 (In thousands), compared with 53,290 (In thousands) in the prior-year quarter.
- Yelp cited headwinds for local businesses and a challenging economic environment for consumers and local businesses.
- Depreciation and amortization was 18,118 (In thousands), compared with 12,365 (In thousands) in the prior-year quarter.
- A revolving credit facility of 100,000 (In thousands) was outstanding as of June 30, 2026.
What to watch
- Execution and engagement trends from Yelp Assistant.
- Scaling of Yelp Host and progress in Hatch's product roadmap.
- Whether Other revenue sustains its 98% year-over-year growth rate.
- The effect of local-business and consumer economic conditions on advertiser spending.
- Delivery against 2026 Net Revenue guidance of $1.460 billion to $1.470 billion and Adjusted EBITDA guidance of $315 million to $325 million.
Balance sheet and cash flow
- Cash and cash equivalents: $ 94,142 (In thousands) as of June 30, 2026, compared with $ 216,062 (In thousands) as of December 31, 2025.
- Short-term marketable securities: — as of June 30, 2026, compared with 103,290 (In thousands) as of December 31, 2025.
- Total assets: $ 990,565 (In thousands) as of June 30, 2026, compared with $ 958,478 (In thousands) as of December 31, 2025.
- Revolving credit facility: 100,000 (In thousands) as of June 30, 2026, compared with — as of December 31, 2025.
- Total liabilities: 346,038 (In thousands) as of June 30, 2026, compared with 247,626 (In thousands) as of December 31, 2025.
- Total stockholders' equity: 644,527 (In thousands) as of June 30, 2026, compared with 710,852 (In thousands) as of December 31, 2025.
- Net cash provided by operating activities: 133,638 (In thousands) for the six months ended June 30, 2026, compared with 156,029 (In thousands) for the six months ended June 30, 2025.
- Acquisition, net of cash received: (263,600) (In thousands) for the six months ended June 30, 2026.
- Net cash used in investing activities: (183,266) (In thousands) for the six months ended June 30, 2026, compared with (26,620) (In thousands) for the six months ended June 30, 2025.
- Net cash used in financing activities: (72,214) (In thousands) for the six months ended June 30, 2026, compared with (151,582) (In thousands) for the six months ended June 30, 2025.
- Change in cash, cash equivalents and restricted cash: (121,991) (In thousands) for the six months ended June 30, 2026, compared with (19,522) (In thousands) for the six months ended June 30, 2025.
Analysis
Yelp reported second-quarter net revenue of $375,519 (In thousands), compared with $370,394 (In thousands) in the prior-year quarter, while the release characterized growth as 1% year over year. The company said quarterly revenue was $8 million above the high end of its outlook range. The principal disclosed revenue growth engine was Other revenue, which increased 98% year over year to a record $33 million and accelerated from the first quarter.
Profitability declined despite the modest revenue increase. Income from operations was 43,730 (In thousands), compared with 53,290 (In thousands) a year earlier, and net income attributable to common stockholders was $31,652 (In thousands), compared with $44,089 (In thousands). The release reported an 8% net income margin. Adjusted EBITDA was $91 million, down 9% year over year, with a reported 24% margin. Depreciation and amortization increased to 18,118 (In thousands) from 12,365 (In thousands), while total costs and expenses were 331,789 (In thousands), compared with 317,104 (In thousands).
Management framed the quarter around its AI transformation and strategic initiatives. Yelp Assistant showed early positive signs in engagement, Yelp Host scaled rapidly, and Hatch accelerated its product roadmap. The company also said its trusted content is powering local discovery for ChatGPT and other AI partners. These initiatives are being pursued while Yelp said consumers and local businesses are navigating a challenging economic environment and local-business headwinds persist.
Capital allocation and liquidity were active during the first six months. Yelp repurchased common stock of (174,000) (In thousands), recorded acquisition spending of (263,600) (In thousands), and had net cash provided by operating activities of 133,638 (In thousands). Cash and cash equivalents were $94,142 (In thousands) at June 30, 2026, compared with $216,062 (In thousands) at December 31, 2025, and the balance sheet included a 100,000 (In thousands) revolving credit facility.
Yelp narrowed its full-year 2026 outlook to Net Revenue of $1.460 billion to $1.470 billion and Adjusted EBITDA of $315 million to $325 million. The filing does not provide a GAAP net income outlook because of uncertainty and potential variability in Other income (expense), net and Provision for (benefit from) income taxes. Investor focus is on whether rapid Other revenue growth and the disclosed AI product initiatives can support the narrowed full-year revenue and Adjusted EBITDA ranges amid the local-business environment described by management.
Management, verbatim
Yelp’s AI transformation continued to gain momentum in the second quarter, with encouraging signs across several key metrics and Other revenue nearly doubling year over year.
Jeremy Stoppelman, Yelp’s co-founder and chief executive officer
In the second quarter, Yelp delivered net revenue of $376 million, $8 million above the high end of our outlook range.
David Schwarzbach, Yelp's chief financial officer
Not in the filing
stated, not guessed- Previous-release outlook was not provided, so comparison of actual results with prior guidance is unavailable.
- Third-quarter 2026 financial guidance figures are not included in the provided filing text.
- Gross profit and gross margin are not reported.
- Quarterly operating cash flow is not reported. The filing provides six-month cash-flow figures only.
- Free cash flow is not reported.
- Dividend amount and dividend declaration are not reported.
- Adjusted EBITDA prior-year dollar amount and reconciliation are not included in the provided filing text.
- Non-GAAP EPS is not reported.
- Revenue detail beyond Other revenue is not reported.
- Prior-quarter figures and quarter-over-quarter changes are not reported for the disclosed quarterly metrics.
- The provided cash-flow statement is truncated after the line 'Cash, cash equivalents and restricted cash — Beginning'; ending cash and restricted-cash cash-flow line items are unavailable.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
The filing is an SEC Form 8-K (Item 2.02) attaching Yelp’s Q2 2026 results and outlook, including AI product updates (Yelp Assistant, Yelp Host, Hatch) and a narrowed 2026 range.
Ticker impact
Yelp reported Q2 2026 net revenue of $376M, Other revenue up 98% YoY, and narrowed 2026 net revenue and Adjusted EBITDA outlook ranges.
Moderate upside bias if investors view the AI-driven Other revenue acceleration and narrowed guidance as improving profitability trajectory; downside risk if margins or engagement metrics disappoint versus expectations.
This is a primary earnings-and-guidance disclosure with specific numeric ranges and a new revenue line item (Other) accelerating sharply, which typically moves the stock through revisions to FY models.
Market effects
Reinforces the market narrative that local advertising and discovery platforms are monetizing AI features, potentially affecting sentiment toward digital local search and ad-tech peers.
Limited direct regional spillover; primarily impacts US-listed ad-tech and consumer internet sentiment.
Low global macro linkage; more relevant to US consumer internet and advertising technology positioning.
Counterpoint
Other revenue nearly doubling may be less durable than core advertising revenue, so investors may discount it if engagement or advertiser spend does not broaden.
Key entities
- companyYelp Inc.
Subject of the 8-K, reporting Q2 2026 results and narrowing full-year 2026 net revenue and Adjusted EBITDA outlook ranges.
- executiveJeremy Stoppelman
Co-founder and CEO, cited AI transformation momentum and early engagement signs from Yelp Assistant and other initiatives.
- executiveDavid Schwarzbach
CFO, cited Q2 performance versus outlook and highlighted Other revenue acceleration.
