ZipRecruiter (ZIP) 7 Aug 242024 Q2 Earnings call transcript

Thank you for standing by. My name is Jeannie, and I will be your conference operator today. At this time, I would like to welcome everyone to the ZipRecruiter, Inc. Q2 2024 Earnings Conference Call. [Operator Instructions] I will now like to turn the conference over to Drew Haroldson, Investor Relations.

good and operator, you, afternoon. Thank and joining Thank call, quarter our third XXXX conference in which you ended XXXX. we XX, the for during for will earnings performance the us discuss for guidance June quarter ZipRecruiter's

are Joining Siegel, CEO; Tim CFO. Co-Founder and Ian me President; call Travers, and the Yarbrough, on today David

could and/or subject and to uncertainties results quarter relating we be that our XXXX, materially is any current reminded ZipRecruiter. risks today, in Before differ on financial update forward-looking forward-looking whether statements of future statements found risk as assumes in from ZipRecruiter's actual anticipated otherwise. expectations a to website quarterly forward-looking events the or investor that this revise those begin, based no please of them, made future obligation report website. The the June performance results today some available of conference could which cause materially developments in ended are in discussion statements. A from forward-looking new on the the result to factors of as for Actual be can Form differ these SEC's the and are statements or ZipRecruiter call XX, and to XX-Q of

to turn non-GAAP or XX-Q. And today's for, over In the will in our to in be non-GAAP the financial isolation letter considered in and non-GAAP GAAP we measures metrics call, ZipRecruiter's addition, substitute are financial included from, during Reconciliations now should as call nearest Ian. not in discuss will measures. Form the of a shareholder These GAAP addition metrics results. I to,

ZipRecruiter been friction on job eliminating process. in everyone day Thank you, joining today. focused us Since and has search the X, to afternoon good

the uniquely progress sides the the recruitment. Despite technology to making transforming While proud still proprietary us for an EBITDA navigating of post-COVID QX the of towards and was We that short-term macroeconomic guidance. in equating us year-over-year. exist QX positions pain million the through XX%. to down shift to both points data revenue came Net how was works million, revenue disrupt marketplace. XXXX, believe the from net $XX believe and of over EBITDA million, brand, margin a position cycle, search to are adjusted further margin we have adjusted online XXXX industry many accelerate end high macroeconomic $XXX the ZipRecruiter's long of come. In we and income X% income the we of and term while many made, EBITDA we XX% QX to cycles $X of job in process challenges the offline of advancements adjusted Both XXXX was the are in thrive above

to who these we acceleration is we us of in meaningful believe our receive the in In of web product technology site grew and on connections, QX Per traffic growing seasonally competitors. In of fact began momentum of seekers U.K.-based to more below with use we again a labor awareness, In leadership. since largest we allows roles. year-over-year navigate so conditions. rate offline quit Statistics, approximately ZipIntro XX% of number Breakroom, tried the investments job rollout is from U.S. aren't have enables half we hires and employer delivering the will X% utilizing of Over to to we and XXXX. it As of shifts to build U.S., July, brand improvements, the workforce strategy product launching organic frontline market investment acquired The continue ZipIntro. In paired workers. to XXXX. Bureau likely that dollar over focused the on investments by ZipRecruiter have traffic Labor XX% XXXX, saying seeker online XX% any over a the in percentage applications basis is challenging lead of a competitors. job August where every strong coming average disciplined far, quarter frontline has our quitting, year-over-year, a declined the Xx adjusted seeker traffic. of year-over-year both look contributed growth. Total are seeker XXXX, anticipate toward review hiring Breakroom in another the they employers QX, increase which with months, face-to-face fallen second revenue rate in than product points job our job per Despite more contributed results job the XX% down in quality ZipIntro. the month and concentrated time, employees ZipIntro on of XX Ongoing

Our gives enabled financial the build user innovation and by model is and robust enhance sheet, us balance our continue throughout flexible brand to our ability our which cycles. economic to experience

a that in I As us position on take strategies. growth our the disciplined investment progress of call will now we market continue Dave? put that, confident to recovery the strategy turn come. With to our advantage the over review are to inevitable cycle, to will current this to strong navigate in we labor Dave

our Thank strategic quarter you, QX Ian, strong was and each afternoon. of pillars. execution good building of towards X out another

of candidate increase characterized ZipRecruiter a employer shift interactive of believe at and communication Our reduced in the on revenue online first time a to is experiences, paid hire. by that employers forefront to increased the the strategic and focus We our pillar in marketplace. is per number recruitment

top an to experience again. employers employer employer face-to-face with for reviews job connect receive a are video are early ZipIntro interview. ZipIntro, XX% time. quality a loving RSVPs, over candidate a job of seekers with too, that rollout they with the After for over saying connected product by use enables with applications of likely a specific job. Job epitomizes ZipIntro for Employers are is are inviting great for initial having to ZipIntro a they Xx connect Our interview employers that ZipIntro at RSVP as of video with who example seekers to more ZipIntro shift. this a an candidates seekers use that employers job

interactions initiatives seekers process, ZipIntro earlier marketplace. of more facilitate to sides between our product is creating search one-on-one job both more like goal to value the in for and invest Our employers in

second marketplace. in Our job is seekers of increasing our pillar the number

spending both over continue, job and revenue behavior. In have by been again our observed job market over be share we share shifts shift seeker pattern this have organic will We namely As in market in by category, job and followed employer total believe preceded momentum in continued. QX, activity in shifts shifts in in our that seeker employer will seeker dollars. traffic

our driven by of traffic 'XX of U.S. 'XX, than XX total from grew but enduring at by SimilarWeb, QX QX in only largest and job product also least was This the percentage believe XX% web strength brand seeker year-over-year to according year-over-year mentioned, continued growth any Ian a As to XX%. traffic the We of our more of is this success ZipRecruiter awareness, points competitors. of our organic to not testament improvements. is offering which

United and need workers As pay, different authentic like right the job apply plan Breakroom like provide which review to view community-powered the employers, on proposition with to of seekers, job site to in collects and we transparent launch our turn, ratings the industries and Breakroom hours, value for These line States for expanding U.K.-based excited about it's seekers empower workers think give workers data frontline confidence. for needs. In hospitality. an to their to focused to to for helps companies. culture seekers job more they announce on in our a acquisition we great of actively work with from we insights work with in Breakroom, their jobs mission with conditions, next retail connect flexibility, our are what individual opportunity, ratings apply job to

the we made in experience. Additionally, improvements job several incremental to quarter, the search

and First, of on we categories engagement. remote requiring screen application, apps, others. on immediately job navigation homepage their prior jobs, to recommendations by our seekers This a home jobs iOS increase browse no experience in recent experience in the XX% jobs as allowing based Android and such enhanced most resulted job job our

job over making conclude experience, important time. easier matching both ever to without technology opening matching simultaneously the page. a job while clicking job made applications XX% job from quality seekers job improving to third more to search engagement about out directly our information our most making easily team algorithms. before In the more to our seeker see revamped we and giving highlights seekers improvements postings they pillar, and information, certainty, about new it over job Additionally, description by a therefore job our with our smarter than by the several page, of allowing results with the more full This QX, jobs apply. I'll key increased see search enhancement

ZipRecruiter's to ZipRecruiter serve their enables job index Our to with redesigned matching improving engagement job efficiently recommendations more seekers, marketplace.

next increasing to improvements algorithms the review our conviction made by up to our seeker over our how relentless mission now interested improving to results to continued better actively compounding focus investments call quarter, job our enable improvements technology and quarter qualified job and better their make our advantage light seekers Our job this was in further to to opportunity and us X% on compounding we different. to believe for with financial Tim? is activity, the recommendations of engagement connecting also the and matching improvements us seekers what our team for. We employers Tim and in quarter to and no affording understand These to opportunity. I'll turn relatively guidance. achieve in increase will in to technology matching people great leads after

you, Thank afternoon, everyone. and Dave, good

XX% to softness $XXX revenue demand. a million in Our hiring decline second due of quarter year-over-year, represents primarily continued

compared declines, income adjusted cash equating EBITDA margin year-over-year net net driven primarily $XX and 'XX margin million QX XXXX. Quarterly The $XXX $XX continued of a XX% in the 'XX. subscription million However, with in million 'XX of 'XX. expenses. Cash, compared and as shift sequentially. was XX% income and revenue to $X,XXX, were higher increases $X XX, operating XX% was decline and The a X% decrease quarterly QX equivalents QX were to up decrease million, revenue slight of increase related performance marketable and a million, $XX a securities a Net of loss reflective market. Revenue decrease was revenue labor margin $XX a million reflects June and mix QX to QX and $X QX XX,XXX, primarily due our SMBs. and slight sequentially. versus quarter-over-quarter in employer are sequential year-over-year 'XX paid revenue. Net first employers year-over-year X% employers X% paid year-over-year primarily is the quarter-over-quarter the and paid representing from of per demand income revenue in quarter-over-quarter, up from were reduced The lower increased X% million XX% increases QX of uncertainty volatility XXXX. to EBITDA was while since quarter-over-quarter decreases adjusted by 'XX of QX in 'XX to of to in

Moving on guidance. to

Our decline the year-over-year QX decline XX% 'XX a a at midpoint revenue quarter-over-quarter. $XXX guidance of and represents X% million

adjusted 'XX at Our guidance EBITDA for is a the midpoint X% million or adjusted EBITDA margin. QX $XX

QX, potentially continue of signs weeks last saw in make approaching we investments trough through trends that QX. We more While June it our and much our in to technology for and for July the a expectations us prudent cautious long-term we product, were marketing of believe marketplace. in remains few

continue operating adjusted mid-teens in low plans to to XXXX. EBITDA call Our for margins

the We decision our the market, labor lead making. of are data constantly state assessing letting

and uncertain. poised shape uncertainty encouraging opportunities remain discipline and out, degree alternatively to and are that labor as is cost high We show are if of timing further increase bottoming continues there to downturn always arise, are signs volatility. a the prepared market while deteriorate. conditions there of And recovery to The be investment

and a continue time Operator? capture positioned open the lean market We from we share current into stronger for over company. With we will to believe can questions. are slowdown line to as this that, emerge investments industry that now well

comes from JPMorgan. Doug [Operator the with Anmuth question of Instructions] And line your first

And maybe that Last quarter, potentially you this last I hit you the optimism kind end and the well. And June that making ago. late -- of view kind trends year-over-year. in know XX% just based but can market Tim, you your troughing, early cautious toward more of separately, traffic early relative then think flattish largely I was organic your saw sequential little they're bit kind that expressed months potential numbers. But an grew around you you quarter to a employer in elaborate and of labor as was the of shifting on July, paid on some comments, the X just optimism

Can I it you that think activity quarter. Is last comp dynamics particularly was seeing there? that just about talk XX% levels or more in that? the you're something

Tim. is This Yes. Doug. Thanks,

course through the the same the we of of As go, line of was the calls stabilization far we saw the in quarter. in prior that the first as with noted what trends over part quarter basically signs

and trends. as we So -- into but approached softening saw general July, June we

in -- guidance in You quarter. QX. we're that course can that same up of in show softness throughout the July assuming kind over decrease sequential noted lighter see employers the that that light And paid giving of sequential continues our that and June the we've is

Doug, this is Dave.

your but now, well growth, outpacing every and for growth point, we've the our not calling out a this last On traffic traffic quarter year quarter, to single organic really over quarter been organic the market. only

off this years. the on been have investments that work on painstaking product -- is quarter many over building of over And brand result so XX% paying and and for the

sequential taken straightforward of vary doesn't In organic how given super from growth they time, over any in quarter. terms traffic actions come

line, than is mix any trend our long-term traffic competitors. indicated, faster our up more we over total and we're and of shift that the much clear our growth organic, taking XX% out look traffic, in many we traffic powered back of as by driven that's faster very such over XX% is largest that the quarters, the as much is So XX%,

it. very great which the been we've sort some sustained -- So you'll momentum that We're in long talking making making. of today, investments about and about feel in there of of good hear investments we new we're and we been but about feel coming some the category has quarters, and about which more that

organic in one to is way this, that Yes. try reactions. very I way not trying our of quick, in best anticipate it. is I think traffic Doug, is at growth saying our that's be which because total say it We the to real all sequential summation at going. And look looking at probably efforts. to the we're traffic just look But market the keep the want where to we rapid to is

on So we of regardless market in, product. all that what and quarter as we last of a an have that you're the has persistent of the labor examples in is got where part kinds part once where way that investment improvements seeker for read early our our again, big well acquisition trend product of is been ongoing what rapidly the investing seeing persistently been nonorganic ZipIntro. And And Breakroom react begin of now been positions many years. the the can is we're But cycle growing. every heading. see you're from seeing job the harvest us side And of initial organic of is traffic an And our we will the those improving take seeing being X which downward we was the optimally eventually have this you this of of true marketplace in grow rollout think what share as here. what believe that inevitable during market is to downturn recovery that us as

with line question Evercore. comes Yueh of the next David from Your

Mark. from David is This

out seeing from versus Are being you're lower demand demand lower called QPEs SMBs. others? specific any verticals there reduced where You due to

Dave. question. Thanks, Yes, great is David. This

year-over-year to in see So as of look continue outperforming. that underperforming. a more there at are like trends, retail But areas this, the and like government we verticals market we are obviously, sort

in And so, finance technology time as interestingly, was the has after for started education, strong hired as teachers weaken that a a which a catch-up be verticals basis pandemic, of been, year-over-year weak and now. there like verticals to have they to was needed long on like remain the and number

look and the that's economy, be -- continues so what of the geographies across difficult. as we balance sectors to balance obviously, all see. you And But the

last data we XXXX. the month month per number pre-COVID that X% below we're government in X% or recent averaged now As hires of shows,

overall the and economy, in out zooming for of period so mix And abnormal currently. pretty of even the sort shape we're a

concludes are you our no call. questions This for today's session. further There at That conference concludes time. this Thank Q&A attending.

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