Yelp Stock Gains as Q3 Earnings and Revenues Surpass Estimates

Core Insights - Yelp Inc. (YELP) shares increased by 2.5% after reporting better-than-expected Q3 2025 results, with earnings rising 8.9% year over year to 61 cents per share, surpassing the Zacks Consensus Estimate by 29.79% [1][10] Financial Performance - Yelp's revenues grew by 4% year over year to $376 million, exceeding the consensus estimate by 2.29%, primarily driven by growth in advertising revenues from Services businesses [2][10] - Advertising revenues, which constitute 94.9% of total revenues, rose 4% year over year to $357 million, supported by increased revenues from Yelp ad products and the RepairPal Network [3] - Advertising revenues from the Services business increased by 6.9% year over year to $243.8 million, while revenues from the Restaurants, Retail & Other (RR&O) division decreased by 2.4% to $113.5 million due to macroeconomic challenges [4] - Total costs and expenses rose by 3% year over year to $323 million, with adjusted EBITDA falling by 3% to $98 million, resulting in a margin decrease from 28% to 26% [6] Balance Sheet & Cash Flow - As of September 30, 2025, Yelp held $334 million in cash and short-term marketable securities with no debt, generating an operating cash flow of $131.5 million and free cash flow of $118.9 million in Q3 [7] Guidance - Yelp updated its full-year 2025 revenue guidance to a range of $1.460 billion to $1.465 billion, while adjusted EBITDA is now expected to be between $360 million and $365 million [8] - For Q4 2025, Yelp anticipates revenues between $355 million and $360 million, with adjusted EBITDA projected in the range of $77 million to $82 million [9]