ZipRecruiter(ZIP)2024-11-06 21:16Financial Performance - For the three months ended September 30, 2024, the company's revenue was $117.1 million, a 25% decrease compared to $155.6 million for the same period in 2023[129][143]. - The company reported a net loss of $2.6 million for the three months ended September 30, 2024, compared to a net income of $24.1 million for the same period in 2023[129][142]. - Adjusted EBITDA for the three months ended September 30, 2024, was $15.0 million, down from $54.4 million in the same period of 2023, resulting in an Adjusted EBITDA margin of 13%[129][142]. - Total revenue for the three months ended September 30, 2024, was $117,084, a decrease of $38,546 or 25% compared to $155,630 for the same period in 2023[169]. - Total revenue for the nine months ended September 30, 2024, was $362,981, a decrease of $146,819 or 29% compared to $509,800 for the same period in 2023[170]. - Subscription revenue decreased by $31,300 or 26% for the three months ended September 30, 2024, while performance-based revenue decreased by $7,200 or 22%[169]. - Subscription revenue for the nine months ended September 30, 2024, decreased by $118,500 or 29% compared to the same period in 2023[170]. - The company experienced a net loss of $2.1 million for the nine months ended September 30, 2024, compared to a net income of $43.5 million in the same period of 2023[205][206]. Revenue and Cost Analysis - The cost of revenue is expected to correlate directly with revenue changes, influenced by factors such as payment processing fees and personnel-related costs[152]. - Cost of revenue for the three months ended September 30, 2024, was $12,382, a decrease of $2,151 or 15% compared to $14,533 for the same period in 2023[172]. - Cost of revenue decreased by $12.2 million, or 24%, for the nine months ended September 30, 2024, compared to the same period in 2023, with a gross margin of 89%[173]. - Gross profit for the three months ended September 30, 2024, was $104,702, compared to $141,097 for the same period in 2023[165]. - Gross margin was 89% for the three months ended September 30, 2024, down from 91% in the same period in 2023[172]. Operating Expenses - Total operating expenses for the three months ended September 30, 2024, were $107,941, compared to $108,431 for the same period in 2023[165]. - Research and development expenses increased to $33,705 for the three months ended September 30, 2024, compared to $32,136 for the same period in 2023[165]. - Sales and marketing expenses decreased by $55.1 million, or 25%, for the nine months ended September 30, 2024, primarily due to a $32.3 million decrease in marketing and advertising costs[175]. - General and administrative expenses decreased by $12.7 million, or 19%, for the nine months ended September 30, 2024, primarily due to a $6.6 million decrease in stock-based compensation[180]. - Research and development expenses increased by $1.6 million, or 5%, for the three months ended September 30, 2024, driven by a $1.5 million increase in personnel-related costs due to the acquisition of Breakroom[177]. Cash Flow and Investments - As of September 30, 2024, the company had cash, cash equivalents, and marketable securities totaling $497.6 million, with $287.6 million available in unused borrowing capacity[187]. - For the nine months ended September 30, 2024, cash provided by operating activities was $33.2 million, down from $68.8 million in the same period of 2023[205][206]. - The company reported a net cash used in investing activities of $47.1 million for the nine months ended September 30, 2024, compared to a net cash provided of $89.4 million in the same period of 2023[207][209]. - Cash used in financing activities for the nine months ended September 30, 2024, was $43.6 million, significantly lower than $142.2 million in the same period of 2023[210][211]. - The company invested $480.1 million in marketable securities during the nine months ended September 30, 2024[207]. Future Outlook and Strategic Initiatives - The company plans to continue aggressive investments in its marketplace to enhance functionality and drive growth[128]. - The company aims to improve its datasets and machine learning capabilities to enhance employer and job seeker engagement[128]. - The company expects to continue investing in research and development activities, with expenses varying as a percentage of total revenue for the foreseeable future[178]. - The company has authorized a share repurchase program of up to $550.0 million, with $25.8 million remaining for future repurchases as of September 30, 2024[199][200]. Market Conditions and Risks - The decline in hiring levels is attributed to high interest rates and reduced churn among employees, leading to a moderation in employer hiring plans[134]. - A hypothetical increase in interest rates of 100 basis points would result in a $0.6 million decrease in the fair value of the company's investment portfolio[222]. - The company is exposed to foreign currency risk primarily related to expenses in currencies other than the U.S. Dollar, with a hypothetical 10% change in exchange rates not expected to have a material impact on financial statements[223][224]. Taxation - The effective tax rate for the nine months ended September 30, 2024, was not meaningful due to a low level of loss before income taxes recorded for the period[184]. - Income tax expense decreased by $13.4 million, or 87%, for the nine months ended September 30, 2024, primarily due to a decrease in income before income taxes[186].