Nextdoor (US:KIND)2025-05-07 22:02Financial Data and Key Metrics Changes - Weekly active users grew 6% year over year to 46.1 million [6][27] - Revenue rose 2% year over year to $54 million [7][31] - Q1 net loss was $22 million, representing a negative 41% margin, which is a 13 percentage point year over year margin improvement [34] - Q1 adjusted EBITDA loss was $9 million, or a negative 17% margin, representing nine percentage points of year over year improvement [34] Business Line Data and Key Metrics Changes - Platform Wow, which includes users engaging directly on the Nextdoor app or website, grew 5% year over year to 22.5 million [28][30] - Self-serve ad adoption rose, accounting for over 60% of revenue in Q1 [33] Market Data and Key Metrics Changes - Large advertisers reduced their spend year over year due to shifting budgets towards programmatic ad buying [32] - Other revenue channels delivered double-digit year over year growth in Q1 [33] Company Strategy and Development Direction - The company is focused on the rollout of the NeXT initiative, which aims to enhance user engagement and monetization through improved product offerings [8][25] - The strategy includes a shift towards more engaging content and a better user experience, aligning with consumer expectations [30][81] - The introduction of AI-driven features is expected to enhance local commerce and user interactions [21][22] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the potential of NeXT to deepen engagement and drive increased monetization [23] - The company anticipates that the financial impact will follow product milestones, with a full launch expected by July [24][38] - Management expects Q2 revenue of approximately $60 million and an adjusted EBITDA loss of around $10 million [38] Other Important Information - The company ended the quarter with $418 million in cash and zero debt [35] - The focus on cost management and cash flow conversion has led to positive operating cash flow [34] Q&A Session Summary Question: Duration of NeXT initiatives impacting user growth and monetization - Management indicated that usage growth and engagement will precede monetization growth, with a clearer picture expected by the next earnings call [41][43] Question: Monetization strategy in a post-NeXT world - Management discussed three ways to enhance monetization: increased engagement leading to more supply, new advertising surfaces, and AI-driven solutions for local needs [49][51][53] Question: Hyperlocal alert strategy and its impact on usage - Management explained that the new alert system will provide more relevant notifications, which is expected to enhance user engagement [60][62][64] Question: Awareness of new UI and marketing costs - Management plans to utilize existing user communication channels and earned media rather than a large marketing expense to drive awareness of the new features [77][80] Question: New disclosures around user metrics - Management clarified that the new disclosures align with consumer expectations and focus on in-app experiences, which are where monetization will occur [81][82]