Nextdoor (US:KIND)2025-08-07 22:00Financial Data and Key Metrics Changes - In Q2, users, revenue, and profitability each improved year over year, with revenue growth driven by momentum in the self-serve channel [16][22] - Q2 revenue was $65 million, up 3% year over year, while self-serve revenue grew 27% year over year and accounted for nearly 60% of total revenue [22][24] - Q2 GAAP net loss was $15 million, representing a negative 24% margin, while adjusted EBITDA loss was $2 million, reflecting a six percentage point year over year improvement [26][28] Business Line Data and Key Metrics Changes - The self-serve channel has become a key contributor to growth, improving advertiser performance, revenue yields, and advertiser retention [16][22] - The new product features, including local news, real-time alerts, and the FAVES AI assistant, aim to increase daily utility for users and create richer surfaces for advertisers [11][12][14] Market Data and Key Metrics Changes - Local news now accounts for roughly 5% of overall feed content, reaching 77% of U.S. cities, with over half of users engaging with this content [8][47] - The alert feature is expected to grow as real-time events occur, enhancing user engagement during critical situations [48][50] Company Strategy and Development Direction - The company is undergoing a transformation focused on product excellence, operational discipline, and community engagement, aiming to become the essential neighborhood network [5][18] - A restructuring plan was announced to improve focus and efficiency, including a workforce reduction to reset the cost structure and aim for adjusted EBITDA breakeven in 2026 [18][29] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the transformation strategy, emphasizing the importance of user experience and the potential for long-term value creation [64][65] - The company expects modest year-over-year revenue growth for the full year 2025, with a path to quarterly adjusted EBITDA breakeven in Q4 [29][30] Other Important Information - The company ended the quarter with $413 million in cash and no debt, indicating a strong balance sheet [27] - A leadership change was announced, with Craig Lisowski appointed as President of Products and Matt Anderson stepping down as CFO [19][20] Q&A Session Summary Question: Can you quantify the changes made to ad loads and the strategy for turning them back on? - Management indicated that the focus is on optimizing user experience first rather than increasing ad load, with excitement about experimenting with new ad formats [35][36] Question: What feedback have you received from advertisers regarding the new platform? - Management noted that CMOs expressed a desire for a better user experience, which aligns with the company's focus, and they plan to work closely with advertisers to define new ad formats [40][42] Question: What are the evolving use cases for the Nextdoor app and which surfaces are users spending the most time on? - Management highlighted that local news and alerts are gaining traction, with significant user engagement, while alerts will grow organically based on real-time events [47][48] Question: How are budget conversations with large advertisers evolving? - Management reported meaningful quarter-over-quarter improvements and expects ongoing gradual benefits from programmatic partnerships and click optimization for larger advertisers [52][54]