ZipRecruiter(ZIP)2024-11-07 04:00Financial Data and Key Metrics - Q3 2024 revenue was 2.6 million, compared to net income of 15 million, equating to a margin of 13% [6] - Cash, cash equivalents, and marketable securities totaled 107 million at the midpoint, representing a 21% decline year-over-year [27] Business Line Performance - Quarterly paid employers were 65,000, a 27% decrease year-over-year and a 7% decrease sequentially [23] - Revenue per paid employer was $1,795, up 3% year-over-year and 2% sequentially [24] - ZipIntro, a new hiring product, saw over 90% of job seekers likely to reuse it and employers received over three times more quality applications per job [14][15] - The next-generation resume database saw a 20% increase in average weekly candidate profile unlocks in the first week of launch [16] Market Performance - Total ZipRecruiter web traffic in the US grew by 21% year-over-year, with organic job seeker traffic growth of 23% [17] - Job seeker engagement increased, with clicks from email notifications rising by 100% and applications from those emails increasing by 120% [21] Company Strategy and Industry Competition - The company is focused on increasing the number of employers and revenue per paid employer, growing job seeker traffic, and improving matching technology [13][17][20] - Investments in brand, AI-driven career advisor (Phil), and matching technology have contributed to job seeker trust and loyalty [9] - The company believes that employer revenue will follow job seeker market share shifts [9] Management Commentary on Operating Environment and Future Outlook - The labor market downturn has been prolonged, with seasonally adjusted hires declining year-over-year every month since August 2022 [10] - The "Great Stay" phenomenon, where employees are leaving jobs at the lowest rate since 2015, is further driving down hiring levels [11] - The company remains confident in the long-term health of the US labor market and sees the end of the "Great Stay" as a future tailwind [11] Other Important Information - The company launched Breakroom in the UK and is working on its US launch, expected in 2025 [48] - New products like ZipIntro and the next-generation resume database are in the value maximization phase and are expected to contribute revenue in 2025 [49][50] Q&A Session Summary Question: Vertical performance and early-cycle verticals - Healthcare remained robust, while transportation, storage, travel, and leisure were weaker [31][32] - Finance and technology, early-cycle verticals, were in the middle of the performance spectrum [33] Question: Enterprise customer performance - Enterprise customers were more robust than SMBs, with performance marketing revenue ticking up to 22% [35] Question: The "Great Stay" and its potential end - The quit rate has fallen by more than one-third since January 2022, driven by factors like above-market salaries, perks, and low mortgage rates [39][40] - The company expects hiring to resume as the economy returns to a steady state [41] Question: Q4 guidance and seasonal slowdown - Q4 guidance accounts for both seasonal decline and continued labor market softness [45] Question: Breakroom launch timeline and monetization - Breakroom is performing well in the UK, with a US launch expected in 2025 [48] - New products like ZipIntro and the resume database are in the value maximization phase and will contribute revenue in 2025 [49][50] Question: Balancing investments and margin profile - The company maintains a low to mid-teens margin profile by responding dynamically to the labor market environment [54] Question: Job seeker traffic growth and its impact - Job seeker growth improves new business acquisition, matching technology, and customer retention [56] - The company has seen steady increases in job seeker traffic over the past two years, outperforming competitors [58] Question: Employer return trends and marketing impact - Brand awareness above 80% drives organic employer returns, especially among SMBs with intermittent hiring needs [59] - The company expects marketing and sales expenses to decrease over time as the business matures [59]