SAN FRANCISCO, Oct. 29, 2013 /PRNewswire/ -- Yelp Inc.
(NYSE: YELP), the company that connects consumers with great local
businesses, today announced financial results for the third quarter
ended September 30, 2013.
(Logo:
http://photos.prnewswire.com/prnh/20050511/SFW134LOGO)
- Net revenue was $61.2 million in
the third quarter of 2013, reflecting 68% growth in net revenue
from the third quarter of 2012
- Cumulative reviews grew 42% year over year to more than 47.3
million
- Average monthly unique visitors grew 41% year over year to
approximately 117 million*
- Active local business accounts grew 61% year over year to
approximately 57,200
Net loss in the third quarter of 2013 was $(2.3) million, or $(0.04) per share, compared to a net loss of
$(2.0) million, or $(0.03) per share, in the third quarter of
2012. Adjusted EBITDA for the third quarter of 2013 was
approximately $8.1 million, compared
to $2.2 million for the third quarter
of 2012.
Net revenue for the nine months ended September 30, 2013 was $162.3 million, an increase of 68% compared to
$96.4 million in the same period last
year. Net loss for the nine months ended September 30, 2013 was $(8.0) million, or $(0.12) per share, compared to a net loss of
$(13.8) million, or $(0.27) per share, in the comparable period in
2012. Adjusted EBITDA for the first nine months of this year
was approximately $19.0 million
compared to $2.8 million for the
first nine months last year.
"We saw another quarter of strong momentum thanks to the
high-quality, authentic content contributed by Yelpers around the
world," said Jeremy Stoppelman,
Yelp's chief executive officer. "Our focus on connecting
consumers with great local businesses continues to drive our
success. In the third quarter, we improved the user
experience by adding the ability to write and post reviews from
mobile and launched new features such as the customer activity feed
for business owners. Looking to the rest of the year and
beyond, we are well positioned to capture the large local
opportunity ahead of us through our innovation around mobile,
geographic expansion and closing the loop with local
businesses."
"We continue to deliver outstanding results, with year over year
revenue growth of 68%," added Rob
Krolik, Yelp's chief financial officer. "Our strong
operating metrics demonstrate our ability to execute across all
areas of our business while the performance of the Yelp playbook
delivers growth across all markets."
Business Highlights
- Yelp mobile: Consumer engagement with Yelp mobile
continues to grow. In the third quarter, approximately 46% of
local ads were shown on mobile devices, approximately 62% of
searches were on mobile, and mobile app usage increased to
approximately 11.2 million unique devices on a monthly average
basis. Additionally, Yelp added a number of mobile features
including the ability to write and post reviews.
- Closing the loop with businesses: In July, Yelp
launched Yelp Platform, which enables consumers to transact with
businesses directly on its site, and acquired SeatMe, a web and
iPad-app based reservation solution for the restaurant and
nightlife categories. Additionally, Yelp launched the
customer activity feed on the business owner's dashboard, showing
in real-time the leads coming to business owners from Yelp through
phone calls, website clicks and directions.
- Geographic expansion: Yelp launched five new Yelp
markets in the third quarter, including four domestically and one
internationally, now totaling 111 Yelp markets. With the
launch of Brazil, Yelp now has a
presence on five continents. Additionally, Yelp has
integrated the Qype France and UK sites.
Business Outlook
As of today, Yelp is initiating guidance for the fourth quarter
of 2013 and raising its full year 2013 revenue and adjusted EBITDA
guidance.
- For the fourth quarter of 2013, net revenue is expected to be
in the range of $66 million to $67
million, representing growth of approximately 62% compared
to the fourth quarter of 2012. Adjusted EBITDA is expected to
be in the range of $9 million to $10
million.
- For the full year of 2013, net revenue is expected to be in the
range of $228 million to $229
million, representing growth of approximately 66% compared
to the full year of 2012. Adjusted EBITDA is expected to be
in the range of $28 million to $29
million.
Quarterly Conference Call
Yelp will discuss its quarterly results today via teleconference
at 1:30 p.m. Pacific Time
(4:30 p.m. Eastern Time). To
access the call, please dial 1 (800) 446-1671, or outside the U.S.
1 (847) 413-3362, with Passcode 35883502, at least five minutes
prior to the 1:30 p.m. PT start
time. A live webcast of the call will also be available at
http://www.yelp-ir.com under the Events & Presentations
menu. An audio replay will be available between 4:00 p.m. PT October 29,
2013 and 11:59 p.m. PT
November 11, 2013 by calling 1 (888)
843-7419 or 1 (630) 652-3042, with Passcode 35883502. The
replay will also be available on the Company's website at
http://www.yelp-ir.com.
About Yelp
Yelp Inc. (http://www.yelp.com) connects people with great local
businesses. Yelp was founded in San
Francisco in July 2004. Since
then, Yelp communities have taken root in major metros across the
U.S., Canada, UK, Ireland, France, Germany, Austria, The
Netherlands, Spain,
Italy, Switzerland, Belgium, Australia, Sweden, Denmark, Norway, Finland, Singapore, Poland, Turkey, New
Zealand, the Czech Republic
and Brazil. Yelp had a monthly
average of approximately 117 million unique visitors in the third
quarter 2013*. By the end of the same quarter, Yelpers had written
more than 47 million rich, local reviews, making Yelp the leading
local guide for real word-of-mouth on everything from boutiques and
mechanics to restaurants and dentists. Yelp's mobile applications
were used on approximately 11.2 million unique mobile devices on a
monthly average basis during the third quarter of 2013.
* Source: Google Analytics
Non-GAAP Financial Measures
This press release includes information relating to Adjusted
EBITDA, which the Securities and Exchange Commission has defined as
a "non-GAAP financial measures." Adjusted EBITDA has been included
in this press release because it is a key measure used by the
Company's management and board of directors to understand and
evaluate core operating performance and trends, to prepare and
approve its annual budget and to develop short- and long-term
operational plans. The presentation of this financial information,
which is not prepared under any comprehensive set of accounting
rules or principles, is not intended to be considered in isolation
or as a substitute for the financial information prepared and
presented in accordance with generally accepted accounting
principles in the United States
("GAAP").
Adjusted EBITDA has limitations as an analytical tool, and you
should not consider it in isolation or as a substitute for analysis
of the Company's results as reported under GAAP. Some of these
limitations are:
- although depreciation and amortization are non-cash charges,
the assets being depreciated and amortized may have to be replaced
in the future, and adjusted EBITDA does not reflect cash capital
expenditure requirements for such replacements or for new capital
expenditure requirements;
- adjusted EBITDA does not reflect changes in, or cash
requirements for, the Company's working capital needs;
- adjusted EBITDA does not consider the potentially dilutive
impact of equity-based compensation;
- adjusted EBITDA does not reflect tax payments that may
represent a reduction in cash available to us;
- adjusted EBITDA does not take into account restructuring and
integration costs associated with our acquisition of Qype; and
- other companies, including those in the Company's industry, may
calculate adjusted EBITDA differently, which reduces its usefulness
as a comparative measure.
Because of these limitations, you should consider adjusted
EBITDA alongside other financial performance measures, including
various cash flow metrics, net income (loss) and the Company's
other GAAP results. Additionally, the Company has not reconciled
adjusted EBITDA guidance for the third quarter and full year 2013
to net income (loss) guidance because it does not provide guidance
for other income (expense) and provision for income taxes, which
are reconciling items between net income (loss) and adjusted
EBITDA. As items that impact net income (loss) are out of the
Company's control and/or cannot be reasonably predicted, the
Company is unable to provide such guidance. Accordingly,
reconciliation to net income (loss) outlook for the third quarter
and full year 2013 is not available without unreasonable
effort. For a reconciliation of historical non-GAAP
financial measures to the nearest comparable GAAP measures, see
"Reconciliation of Net Loss to Adjusted EBITDA" included in
this press release.
Forward-Looking Statements
This press release contains forward-looking statements relating
to, among other things, the future performance of Yelp and its
consolidated subsidiaries that are based on the Company's current
expectations, forecasts and assumptions and involve risks and
uncertainties. These statements include, but are not limited to,
statements regarding expected financial results for the fourth
quarter and full year 2013, the future growth in Company revenue
and continued investing by the Company in its future growth, the
Company's ability to build Yelp communities internationally and
expand its markets and presence in existing markets, the Company's
ability to capture the large local opportunity and its plans
regarding product innovation around mobile and new features,
geographic expansion, closing the loop with local businesses and
continued integration of Qype into Yelp. The Company's actual
results could differ materially from those predicted or implied and
reported results should not be considered as an indication of
future performance. Factors that could cause or contribute to such
differences include, but are not limited to: the Company's short
operating history in an evolving industry; the Company's ability to
generate sufficient revenue to achieve or maintain profitability,
particularly in light of its significant ongoing sales and
marketing expenses; the Company's ability to successfully manage
acquisitions of new businesses, solutions or technologies,
including Qype and SeatMe, and to integrate those businesses,
solutions or technologies; the Company's reliance on traffic to its
website from search engines like Google, Bing and Yahoo!; the
Company's ability to generate and maintain sufficient high quality
content from its users; maintaining a strong brand and managing
negative publicity that may arise; maintaining and expanding the
Company's base of advertisers; changes in political, business and
economic conditions, including any European or general economic
downturn or crisis and any conditions that affect ecommerce growth;
fluctuations in foreign currency exchange rates; the
Company's ability to deal with the increasingly competitive local
search environment; the Company's need and ability to manage other
regulatory, tax and litigation risks as its services are offered in
more jurisdictions and applicable laws become more restrictive; the
competitive and regulatory environment while the Company continues
to expand geographically and introduce new products and as new laws
and regulations related to Internet companies come into effect; the
Company's ability to timely upgrade and develop its systems,
infrastructure and customer service capabilities. The
forward-looking statements in this release do not include the
potential impact of any acquisitions or divestitures that may be
announced and/or completed after the date hereof.
More information about factors that could affect the Company's
operating results is included under the captions "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and
Results of Operations" in the Company's most recent Quarterly
Report on Form 10-Q at http://www.yelp-ir.com or the SEC's website
at www.sec.gov. Undue reliance should not be placed on the
forward-looking statements in this release, which are based on
information available to the Company on the date hereof. Yelp
assumes no obligation to update such statements. The results we
report in our Quarterly Report on Form 10-Q for the three months
ended September 30, 2013 could differ
from the preliminary results we have announced in this press
release.
Media Contact Information
Yelp Press Office
Vince Sollitto
(415) 230-6506
press@yelp.com
Investor Relations Contact Information
The Blueshirt Group
Stacie Bosinoff, Nicole Gunderson
(415) 217-7722
yelp@blueshirtgroup.com
Yelp
Inc
|
Condensed
Consolidated Balance Sheets
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
September
30,
|
|
|
December
31,
|
|
|
|
2013
|
|
|
2012
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
|
$
101,214
|
|
|
$
95,124
|
Accounts receivable,
net
|
|
|
17,192
|
|
|
11,738
|
Prepaid expenses and
other current assets
|
|
|
6,809
|
|
|
4,912
|
Total current
assets
|
|
|
125,215
|
|
|
111,774
|
|
|
|
|
|
|
|
Property, equipment
and software, net
|
|
|
25,921
|
|
|
14,799
|
Goodwill
|
|
|
58,814
|
|
|
48,605
|
Intangibles,
net
|
|
|
5,772
|
|
|
5,936
|
Restricted
cash
|
|
|
8,168
|
|
|
6,400
|
Other
assets
|
|
|
440
|
|
|
182
|
Total
assets
|
|
|
$
224,330
|
|
|
$
187,696
|
|
|
|
|
|
|
|
Liabilities and
stockholders' equity
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
|
$
2,839
|
|
|
$
2,284
|
Accrued
liabilities
|
|
|
22,040
|
|
|
16,367
|
Deferred
revenue
|
|
|
2,221
|
|
|
2,856
|
Total current
liabilities
|
|
|
27,100
|
|
|
21,507
|
Long-term
liabilities
|
|
|
799
|
|
|
527
|
Total
liabilities
|
|
|
27,899
|
|
|
22,034
|
|
|
|
|
|
|
|
Commitments and
contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders'
equity
|
|
|
|
|
|
|
Common
stock
|
|
|
-
|
|
|
-
|
Additional paid-in
capital
|
|
|
262,675
|
|
|
225,245
|
Accumulated other
comprehensive income
|
|
|
2,143
|
|
|
805
|
Accumulated
deficit
|
|
|
(68,387)
|
|
|
(60,388)
|
Total stockholders'
equity
|
|
|
196,431
|
|
|
165,662
|
Total liabilities and
stockholders' equity
|
|
|
$
224,330
|
|
|
$
187,696
|
Yelp
Inc
|
Condensed
Consolidated Statements of Operations
|
(In thousands, except
per share amounts)
|
(Unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
|
Net
revenue
|
|
$ 61,181
|
|
$ 36,371
|
|
$ 162,337
|
|
$
96,410
|
|
|
|
|
|
|
|
|
|
Cost and
expenses
|
|
|
|
|
|
|
|
|
Cost of revenue
(1)
|
|
4,277
|
|
2,501
|
|
11,635
|
|
6,925
|
Sales and marketing
(1)
|
|
34,126
|
|
21,302
|
|
93,123
|
|
60,404
|
Product development
(1)
|
|
11,208
|
|
5,753
|
|
26,441
|
|
14,230
|
General and
administrative (1)
|
|
10,535
|
|
6,987
|
|
29,447
|
|
23,679
|
Depreciation and
amortization
|
|
2,816
|
|
1,780
|
|
7,931
|
|
4,802
|
Restructuring and
integration (1)
|
|
-
|
|
-
|
|
675
|
|
-
|
|
|
|
|
|
|
|
|
|
Total cost and
expenses
|
|
62,962
|
|
38,323
|
|
169,252
|
|
110,040
|
Loss from
operations
|
|
(1,781)
|
|
(1,952)
|
|
(6,915)
|
|
(13,630)
|
Other income
(expense), net
|
|
(31)
|
|
(14)
|
|
(298)
|
|
(23)
|
Loss before provision
for income taxes
|
|
(1,812)
|
|
(1,966)
|
|
(7,213)
|
|
(13,653)
|
Provision for income
taxes
|
|
(510)
|
|
(45)
|
|
(786)
|
|
(142)
|
Net loss
|
|
(2,322)
|
|
(2,011)
|
|
(7,999)
|
|
(13,795)
|
Accretion of
redeemable convertible preferred stock
|
|
-
|
|
-
|
|
-
|
|
(31)
|
Net loss attributable
to common stockholders
|
|
$ (2,322)
|
|
$ (2,011)
|
|
$
(7,999)
|
|
$ (13,826)
|
|
|
|
|
|
|
|
|
|
Net loss per share
attributable to common stockholders:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
(0.04)
|
|
$
(0.03)
|
|
$
(0.12)
|
|
$
(0.27)
|
Diluted
|
|
$
(0.04)
|
|
$
(0.03)
|
|
$
(0.12)
|
|
$
(0.27)
|
|
|
|
|
|
|
|
|
|
Weighted-average
shares used to compute net loss per share attributable to common
stockholders:
|
|
|
|
|
|
|
|
|
Basic
|
|
65,530
|
|
61,267
|
|
64,620
|
|
51,176
|
Diluted
|
|
65,530
|
|
61,267
|
|
64,620
|
|
51,176
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Includes
stock-based compensation expense as follows:
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
Cost of
revenue
|
|
$
104
|
|
$
27
|
|
$
281
|
|
$
85
|
Sales and
marketing
|
|
2,660
|
|
1,152
|
|
6,930
|
|
3,171
|
Research and
development
|
|
1,709
|
|
466
|
|
3,565
|
|
1,009
|
General and
administrative
|
|
2,542
|
|
689
|
|
6,557
|
|
7,356
|
Restructuring and
integration
|
|
-
|
|
-
|
|
555
|
|
-
|
Total stock-based
compensation
|
|
$
7,015
|
|
$
2,334
|
|
$
17,888
|
|
$
11,621
|
Yelp
Inc.
|
Condensed
Consolidated Statements of Cash Flows
|
(In
thousands)
|
(Unaudited)
|
|
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
|
2013
|
|
2012
|
Operating
activities
|
|
|
|
|
Net loss
|
|
$ (7,999)
|
|
$ (13,795)
|
Adjustments to
reconcile net loss to net
|
|
|
|
|
cash provided
by (used in) operating activities:
|
|
|
|
|
Depreciation and
amortization
|
|
7,931
|
|
4,802
|
Provision for
doubtful accounts and sales returns
|
|
2,178
|
|
193
|
Stock-based
compensation
|
|
17,888
|
|
11,621
|
Loss on disposal of
assets and web-site development costs
|
|
188
|
|
25
|
Changes in operating
assets and liabilities:
|
|
|
|
|
Accounts
receivable
|
|
(7,557)
|
|
(2,657)
|
Prepaid expenses and
other assets
|
|
(3,020)
|
|
(1,760)
|
Accounts payable and
accrued expenses
|
|
3,179
|
|
672
|
Deferred
revenue
|
|
(680)
|
|
(829)
|
Net cash provided by
(used in) operating activities
|
|
12,108
|
|
(1,728)
|
|
|
|
|
|
Investing
activities
|
|
|
|
|
Acquisition of
SeatMe, net of cash received
|
|
(2,057)
|
|
-
|
Purchases of
property, equipment and software
|
|
(9,547)
|
|
(3,484)
|
Capitalized website
and software development costs
|
|
(3,265)
|
|
(2,334)
|
Change in restricted
cash
|
|
(1,768)
|
|
(6,048)
|
Goodwill measurement
period adjustment
|
|
1,153
|
|
-
|
Cash used in
investing activities
|
|
(15,484)
|
|
(11,866)
|
|
|
|
|
|
Financing
activities
|
|
|
|
|
Proceeds from initial
public offering, net of offering costs
|
|
-
|
|
112,257
|
Proceeds from
issuance of common stock
|
|
9,702
|
|
2,824
|
Repurchase of common
stock
|
|
(368)
|
|
-
|
|
|
|
|
|
Net cash provided by
financing activities
|
|
9,334
|
|
115,081
|
|
|
|
|
|
Effect of exchange
rate changes on cash
|
|
132
|
|
(140)
|
|
|
|
|
|
Net increase in cash
and cash equivalents
|
|
6,090
|
|
101,347
|
Cash and cash
equivalents at beginning of period
|
|
95,124
|
|
21,736
|
Cash and cash
equivalents at end of period
|
|
$ 101,214
|
|
$ 123,083
|
Yelp
Inc
|
Reconciliation of
Net Loss to Adjusted EBITDA
|
(In
thousands)
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Nine Months
Ended
|
|
|
September
30,
|
|
September
30,
|
|
|
2013
|
|
2012
|
|
2013
|
|
2012
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$ (2,322)
|
|
$ (2,011)
|
|
$ (7,999)
|
|
$ (13,795)
|
Provision for income
taxes
|
|
510
|
|
45
|
|
786
|
|
142
|
Other income
(expense), net
|
|
31
|
|
14
|
|
298
|
|
23
|
Depreciation and
amortization
|
|
2,816
|
|
1,780
|
|
7,931
|
|
4,802
|
Stock-based
compensation
|
|
7,015
|
|
2,334
|
|
17,333
|
|
11,621
|
Restructuring and
integration
|
|
-
|
|
-
|
|
675
|
|
-
|
Adjusted
EBITDA
|
|
$
8,050
|
|
$
2,162
|
|
$ 19,024
|
|
$
2,793
|
SOURCE Yelp Inc.