Financial Data and Key Metrics Changes - Yelp reported an 8% year-over-year revenue growth, generating $359 million in net revenue, with net income increasing by 72% to $24 million, representing a 7% margin [5][11] - Adjusted EBITDA rose by 32% year-over-year to $85 million, reflecting a 24% margin, exceeding expectations by $15 million [11][14] - The company expanded its net income margin by three percentage points and adjusted EBITDA margin by four percentage points compared to the prior year [5] Business Line Data and Key Metrics Changes - Services revenue increased by 14% year-over-year to $232 million, marking the sixteenth consecutive quarter of double-digit growth [11][12] - Revenue from restaurants and retail (RR and O) declined by 3% year-over-year to $110 million, with a decrease in paying advertising locations to 517,000 [12][13] - Ad clicks also fell by 3% year-over-year, primarily due to macro pressures in the RR and O categories [12] Market Data and Key Metrics Changes - The operating environment for businesses in the restaurant and retail sectors remains challenging, contributing to the decline in RR and O revenue [6] - Despite the challenges in RR and O, services categories showed strong momentum, with a 10% increase in Request to Quote projects year-over-year [6][7] Company Strategy and Development Direction - Yelp's product-led strategy continues to strengthen the business, with recent rollouts of 15 new features and updates [5] - The company is focusing on enhancing the hiring experience through AI-powered tools and integrating with platforms like Zapier to connect with over 800 CRM systems [8] - Yelp is investing in AI technologies to improve consumer interactions and is excited about the potential of Yelp Assistant to transform user experiences [9][38] Management's Comments on Operating Environment and Future Outlook - Management noted that while the first quarter showed resilience, macroeconomic uncertainties have increased, impacting advertiser sentiment [20][22] - The company expects second-quarter net revenue to be between $362 million and $367 million, with full-year revenue guidance widened to $1.465 billion to $1.485 billion [17][18] - Management remains optimistic about long-term shareholder value creation despite current macro challenges [18] Other Important Information - Yelp repurchased $62.5 million worth of shares in the first quarter, with $268 million remaining under the existing repurchase authorization [14] - The company aims to reduce stock-based compensation as a percentage of revenue to less than 8% by the end of 2025 [13] Q&A Session Summary Question: Can you discuss trends in advertiser sentiment and vertical performance? - Management indicated that services performed well with 14% year-over-year growth, while RR and O advertisers are more cautious due to macro uncertainties [20][21] Question: What are the drivers of CPC growth? - CPC growth was driven by robust advertiser demand in services, while RR and O faced softer trends leading to fewer clicks [29][30] Question: Can you elaborate on the AI strategy and its impact? - Management highlighted the potential of AI in enhancing user experience and lead generation, with new features like photo recognition and intelligent matching being developed [41][42] Question: What are the engagement trends across mobile and web? - Engagement trends showed macro pressure in RR and O, but strong growth in services, with project volume increasing by 15% year-over-year [48][49]

Financial Data and Key Metrics Changes - Yelp reported an 8% year-over-year revenue growth, generating $359 million in net revenue, with net income increasing by 72% to $24 million, representing a 7% margin [5][11] - Adjusted EBITDA rose by 32% year-over-year to $85 million, reflecting a 24% margin, exceeding expectations by $15 million [11][14] - The company expanded its net income margin by three percentage points and adjusted EBITDA margin by four percentage points compared to the prior year [5] Business Line Data and Key Metrics Changes - Services revenue increased by 14% year-over-year to $232 million, marking the sixteenth consecutive quarter of double-digit growth [11][12] - Revenue from restaurants and retail (RR and O) declined by 3% year-over-year to $110 million, with a decrease in paying advertising locations to 517,000 [12][13] - Ad clicks also fell by 3% year-over-year, primarily due to macro pressures in the RR and O categories [12] Market Data and Key Metrics Changes - The operating environment for businesses in the restaurant and retail sectors remains challenging, contributing to the decline in RR and O revenue [6] - Despite the challenges in RR and O, services categories showed strong momentum, with a 10% increase in Request to Quote projects year-over-year [6][7] Company Strategy and Development Direction - Yelp's product-led strategy continues to strengthen the business, with recent rollouts of 15 new features and updates [5] - The company is focusing on enhancing the hiring experience through AI-powered tools and integrating with platforms like Zapier to connect with over 800 CRM systems [8] - Yelp is investing in AI technologies to improve consumer interactions and enhance service offerings, including upcoming AI-powered call answering services [9][46] Management's Comments on Operating Environment and Future Outlook - Management noted that while the first quarter showed resilience, macroeconomic uncertainties have increased, impacting advertiser sentiment [20][22] - The company expects second-quarter net revenue to be in the range of $362 million to $367 million, with full-year revenue guidance modestly widened to between $1.465 billion and $1.485 billion [17][18] - Management remains optimistic about long-term shareholder value creation despite current macro challenges [18] Other Important Information - Yelp repurchased $62.5 million worth of shares in the first quarter, with $268 million remaining under the existing repurchase authorization [14] - The company aims to reduce stock-based compensation as a percentage of revenue to less than 8% by the end of 2025 and less than 6% by the end of 2027 [13][14] Q&A Session Summary Question: Can you discuss trends in advertiser sentiment and vertical performance? - Management indicated that services performed well with 14% year-over-year growth, while RR and O advertisers are more cautious due to macro uncertainties [20][21] Question: What are the drivers of CPC growth? - CPC growth was driven by robust advertiser demand in services, while RR and O faced headwinds leading to fewer clicks [29][30] Question: Can you elaborate on the AI strategy and its impact on CPCs? - Management highlighted the potential of AI in enhancing consumer interactions and improving lead quality, which could support CPC increases [41][42] Question: What are the engagement trends across mobile and web? - Engagement trends showed macro pressure in RR and O, but strong growth in services, with project volume increasing by 15% year-over-year [48][49]