Yelp's Q1 2024 Revenue Surges by 7%

Yelp recently released its 10-Q report, revealing a 7% increase in net revenue to $332.8 million for the first quarter of 2024 compared to the same period in 2023. The company recorded net income of $14.2 million and adjusted EBITDA of $64.5 million during this period. Yelp's primary source of revenue is the sale of performance-based advertising products, with advertising revenue from Services businesses increasing by 11% year over year, led by approximately 15% year-over-year revenue growth in the Home Services subcategories.

The number of ad clicks increased by 8% in the first quarter of 2024, while the average cost per click (CPC) decreased by 1% year over year. This indicates that Yelp delivered more ad clicks at lower prices, providing more value to advertisers. Advertising revenue from the Services category amounted to $203.3 million, representing an 11% increase, while revenue from Restaurants, Retail & Other (RR&O) categories saw a 1% increase to $114.4 million.

Paying advertising locations decreased by 4% to 530,000, with paying advertising locations in the Services categories increasing by 6% and those in the RR&O categories decreasing by 12% compared to the prior-year period. The decrease in RR&O paying advertising locations was attributed to the challenging operating environment faced by businesses in these categories.

Yelp's total costs and expenses amounted to $321.5 million, representing a 1% increase from the same period in 2023. The company reported net income attributable to common stockholders of $14.2 million, a significant improvement from a net loss of $1.2 million in the first quarter of 2023.

These figures indicate a positive growth trajectory for Yelp, driven by increased advertising revenue from Services businesses and improvements in the number of ad clicks and average CPC. Despite challenges in the RR&O categories, Yelp's strategic investments in product and marketing continue to drive progress on its revenue growth initiatives. Following these announcements, the company's shares moved -7.1%, and are now trading at a price of $36.79. For more information, read the company's full 10-Q submission here.

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