Yelp (YELP) Q4 2025 earnings summary

Executive summary

• Achieved record net revenue of $1.46 billion in 2025, up 4% year-over-year, with net income rising 10% to $146 million and diluted EPS up 19% to $2.24.

• Product innovation, especially in AI, drove results, with over 55 new products and features launched, including significant expansion of Yelp Assistant and AI-powered tools.

• Positioned as a leader in local search with hundreds of millions of trusted, human-generated reviews, essential for AI-driven discovery and engagement.

• Returned nearly $2.0 billion to shareholders via share repurchases as of December 31, 2025.

• Focused on long-term growth through AI transformation, product innovation, and operational efficiency, with a flat headcount enabling leverage across expense lines.

Financial highlights

• Adjusted EBITDA increased 3% year-over-year to $369 million (25% margin); free cash flow reached a record $324 million.

• Q4 2025 net revenue was $360 million, down 1% year-over-year; net income for the quarter was $38 million (10% margin), down 10% year-over-year.

• Earnings per share grew to $2.24 in 2025, with a reduced share count of 67.1M.

• Other revenue (transactions, subscriptions, licensing) grew 17% year-over-year to $60.5M in 2025.

• Free cash flow for 2025 was $324M, with a 22% margin; cash from operations totaled $372M.

Outlook and guidance

• 2026 net revenue expected between $1.455 billion and $1.475 billion; Q1 2026 guidance is $350–$355 million.

• 2026 Adjusted EBITDA projected at $310–$330 million, with margin of 21–22%, and increased expenses due to AI investments, Hatch integration, and paid traffic acquisition.

• Stock-based compensation as a percentage of revenue targeted to fall below 6% by end of 2027.

• Headcount, excluding Hatch, expected to remain flat in 2026.