Yelp Inc.

Ladies and gentlemen, once again, I do really appreciate your patience. Good afternoon and welcome. My name is Aaron. I will be our conference operator for today. And I would, again, like to welcome you to the Q1 2026 Yelp incorporated earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. And at that point, if you would like to ask a question, remember it's star plus the number one on your telephone keypad. At any point, if you'd like to withdraw your question, just hit star followed by the number one again. And with that, let's go ahead and begin our call. It's my pleasure to turn our call over to Kate Krieger, Director of Investor Relations. Kate, with that, you can go ahead. Thank you.

Good afternoon, everyone, and thanks for joining us on Yelp's first quarter 2026 earnings conference call. Joining me today are Yelp's Chief Executive Officer Jeremy Soppelman, Chief Financial Officer David Schwarzbach, and Chief Operating Officer Jed Nockman. We published this shareholder letter on our investor relations website and with the SEC and hope everyone had a chance to read it. We'll provide some brief opening comments and then turn to your questions. Now I'll read our safe harbor statement. We'll make certain statements today that are forward looking and involve a number of risks and uncertainties that could cause actual results to differ materially. Please note that these forward-looking statements reflect our opinions only as of the date of this call, and we undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements in light of new information or future events. In addition, we are subject to a number of risks that may significantly impact our business and financial results. Please refer to our SEC filings as well as our shareholder letter for a more detailed description of the risk factors that may affect our results. During our call today, we may discuss adjusted EBITDA, adjusted EBITDA margin, and free cash flow, which are non-GAAP financial measures. These measures should not be considered in isolation from or as a substitute for financial information prepared in accordance with generally accepted accounting principles. In our shareholder letter released this afternoon and our filings with the SEC, each of which is posted on our investor relations website, you will find additional disclosures regarding these non-GAAP financial measures as well as historical reconciliations of GAAP net income or loss to both adjusted EBITDA and adjusted EBITDA margin, and a historical reconciliation of GAAP cash flows from operating activities to free cash flow. And with that, I will turn the call over to Jeremy.

Thanks, Kate, and welcome everyone. Yelp continued to accelerate its AI transformation in the first quarter. We are making local discovery increasingly conversational, delivering tools to help businesses succeed and expanding the reach of our trusted content through new partnerships. Our progress in the quarter resulted in the recent rollout of more than 35 new features and updates, including a new Yelp assistant that now works across all categories. At the same time, local businesses have continued to face a challenging economic environment. First quarter net revenue increased by 1% year over year to $361 million, with a net income margin of 5% and an adjusted EBITDA margin of 22%. Underlying our top line results, services ad revenue increased by 1% year over year, and RRNO ad revenue decreased by 11% year over year. We've increased our focus on growing a number of AI-driven revenue streams this year, and other revenue grew 75% year over year as a result. Moving to our product initiatives, we are reconceiving how consumers and businesses connect on Yelp through a conversational experience that provides answers and enables actions. In the first quarter, Yelp Assistant connected more consumers and service pros than ever before, with its growing adoption accounting for approximately 15% of Request a Quote projects. We recently rolled out a new Yelp Assistant that supports local discovery across every business category on Yelp, delivering trusted recommendations while surfacing relevant reviews, star ratings, and other helpful details. While still early, we are seeing positive signals and believe Yelp Assistant can ultimately drive deeper engagement. In addition to evolving our product offerings, we are expanding our partner ecosystem to help consumers complete tasks like initiating a reservation or booking an appointment. In the first quarter, consumers took advantage of the hundreds of thousands of new restaurants available for food ordering and delivery through our DoorDash partnership, with food ordering revenue of 88% year over year. More recently, we announced new integrations with Vigaro and DocDoc to enable users to book beauty, wellness, fitness, and healthcare appointments. We are delivering AI tools that help service pros and other local businesses grow, operate, and succeed. For advertisers, this showed up in the form of improvements to the ad experience and business owner platform, where we've introduced a new AI-powered support chatbot that streamlines administrative activities. Our team continued to scale Yelp host, our AI-powered call answering service for restaurants, which surpassed an annual run rate of 1.5 million calls handled in April, more than doubling from January. We plan to roll out new improvements and functionality, including the ability to place food orders over the phone. Overall, we estimate there is a market opportunity of over a billion dollars in the United States for Yale Post. With our best in class offering and expansive distribution, we believe we are well positioned to capture meaningful market share. We also accelerated our strategy in this area for services businesses through the acquisition of Hatch in February and have been pleased with the team's early progress. Notably, Hatch's annual run rate revenue exceeded $34 million in March, up 92% year over year. Looking ahead, we see considerable opportunity for significant growth, and we have added Yelp go-to-market and engineering resources to advance Hatch's growth initiatives. Lastly, we are extending our reach to power local discovery across the AI ecosystem through data licensing. In the first quarter, we secured new licensing agreements, including with OpenAI, and expanded our integrations with existing partners. Consumers can now find licensed Yelp content on Amazon Alexa, Apple Maps, Microsoft Bing, Meta AI, and Yahoo, among many other platforms. We expect the operating environment for local businesses to remain challenging this year. As such, we have allocated meaningful resources to drive growth and other revenue through AI-driven offerings such as Yelp host, Hatch, and data licensing. As these accretive revenue streams continue to gain traction, we are targeting an annual run rate of $250 million in other revenue by the end of 2028, more than double the run rate delivered in the first quarter of this year. In summary, We continue to make significant progress transforming Yelp with AI in the first quarter as we focus on deepening the connection between consumers and businesses. We're confident in our plans for the year and believe that our initiatives will position us to drive profitable growth over the long term. With that, I'll turn it over to David.