ZipRecruiter, Inc.

Thank you for standing by. My name is Aaron and I will be your conference operator for today. At this time, I'd like to welcome everyone to the ZipRecruiter Q3 2023 earnings 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 if you would like to ask a question during this time, simply press star followed by the number one on your touchtone keypad. If you would like to withdraw your question, press star followed by the number one again. Thank you. I would now like to turn our call over to Drew Haroldson with Investor Relations. Drew, please go ahead.

Thank you, operator, and good afternoon. Thank you for joining us in our earnings conference call, during which we will discuss ZipRecruiter's performance for the quarter ended September 30, 2023, and guidance for the fourth quarter, 2023. Joining me today on the call are Ian Siegel, co-founder and CEO, David Travers, president, and Tim Yarbrough, CFO. Before we begin, please be reminded that forward-looking statements made today are subject to risks and uncertainties relating to future events and or the future financial performance of ZipRecruiter. Actual results could differ materially from those anticipated in these forward-looking statements. A discussion of some of the risk factors that could cause actual results to differ materially from any forward-looking statements can be found on ZipRecruiter's quarterly report on Form 10-Q for the quarter end of December 30, 2023, which will be available on our investor website and the SEC's website. The forward-looking statements in this conference call are based on the current expectations as of today, and ZipRecruiter assumes no obligation to update or revise them, whether as a result of new developments or otherwise. In addition, during today's call, we will discuss non-GAAP financial measures. These non-GAAP financial measures should be considered in addition to, as a substitute for, or in isolation from, GAAP results. Reconciliations of the non-GAAP metrics to the nearest GAAP metrics are included in ZipRecruiter's shareholder letter and in our Form 10-Q. And now I will turn the call over to Ian.

Thank you, Drew. Good afternoon to everyone joining us today. Before we get started, I wanted to say a few words about ZipRecruiter's Tel Aviv employees. As the conflict in Israel and Gaza unfolds, our number one priority has been the health and safety of our people. While all Tel Aviv-based employees have been impacted to some degree, unfortunately, some of them have been directly impacted. Our hearts go out to them for their losses and the conditions under which they must now operate. I have watched with pride and gratitude as ZipRecruiter team members around the globe have proactively taken on extra responsibilities so that our Israeli employees can prioritize taking care of their families. The well-being of our fellow team members will remain top of mind as we hope for peace and security in the region. Turning to our results, third quarter financials further demonstrate ZipRecruiter's resilience and durability as macroeconomic conditions soften. Adjusted EBITDA of $54 million and adjusted EBITDA margin of 35% exceeded the high point of our guidance. Notably, adjusted EBITDA and adjusted EBITDA margin were all-time highs despite a weakening top line. ZipRecruiter has a resilient business model that has allowed us to weather the industry-wide hiring slowdown and maintain strong adjusted EBITDA profitability while still investing for the long term. The dramatic change in the hiring market has impacted ZipRecruiter's business along with other offline and online hiring related businesses in the United States. Despite some positive economic news, such as real GDP growth of 4.9% in Q3 of 23, and unemployment of 3.8% in September of 2023. These data points only show a part of the complicated picture that is the U.S. labor economy. The Federal Reserve's 525 basis point increase in interest rates over the past 18 months has increased the cost of capital for businesses, leading to employers taking a far more cautious approach to hiring than just a few quarters of growth. This increased caution manifests itself in both the number of job openings and the urgency with which those openings need to be filled. As a result, job seekers are taking longer to find work and those currently employed are changing jobs with less frequency. The great resignation is over with quit rates returning to pre-COVID levels. This rapid change in the hiring market has impacted ZipRecruiter's business along with other offline and online hiring related businesses in the United States. Over any short-term period, the cyclical nature of the US labor market will create a dynamic operating environment for us to navigate. The flexibility and profitability of our business model have allowed us to weather this protracted downturn while continuing to invest in product innovation, technological advancement, and increasing awareness of our already famous recruiting brand. While the total number of people employed in the United States from Q3 of 2019 to Q3 2023 has increased by approximately 3%, ZipRecruiter's revenue has increased by 38%, and adjusted EBITDA margin has expanded from 2% to 35%. We believe the opportunity in front of us to continue to capture more market share through continuous product innovation and technological advancement is bigger than it has ever been. Now I'll turn it over to Dave to talk through some of our progress against the three pillars of our marketplace strategy.