Yelp (NYSE:YELP) Issues Quarterly Earnings Results

Yelp (NYSE:YELP) released its quarterly earnings data on Thursday. The local business review company reported $0.63 EPS for the quarter, topping the consensus estimate of $0.43 by $0.20, FiscalAI reports. Yelp had a return on equity of 19.52% and a net margin of 8.59%. The firm had revenue of $370.92 million for the quarter, compared to the consensus estimate of $368.66 million. During the same quarter in the previous year, the business earned $0.61 earnings per share. The company’s quarterly revenue was down 1.4% on a year-over-year basis.

Here are the key takeaways from Yelp’s conference call:

• Advertising remained under pressure. Services ad revenue fell 2% and RR&O ad revenue fell 13% year over year; ad clicks declined 8%. Yelp expects further advertising pressure in the fourth quarter amid a challenging environment for consumers and local businesses.
• AI-driven businesses are gaining traction. Other revenue rose 82% to a record $34 million, and Yelp is targeting a $250 million annual run rate by the end of 2028. Hatch reached about $37 million in annual run-rate revenue, up 55% year over year, while Yelp Host reached a 2.5 million annual run rate of calls handled.
• Overall results and near-term revenue outlook were soft. Third-quarter revenue declined 1% to $371 million, net income fell 12% to $35 million, and adjusted EBITDA decreased 6% to $92 million. Yelp forecast fourth-quarter revenue of $347 million to $352 million, though it narrowed its full-year adjusted EBITDA outlook to the high end of its prior range.
• Yelp is balancing investment with shareholder returns. The company repurchased $200 million of shares year to date, helping reduce diluted shares outstanding 15% year over year, but paused buybacks to pay down its revolving credit facility and expects to resume them in 2027, subject to conditions.

Yelp Stock Down 5.4%

Shares of Yelp stock traded down $1.11 on Friday, hitting $19.41. 2,315,753 shares of the company’s stock traded hands, compared to its average volume of 1,200,609. The company has a quick ratio of 1.75, a current ratio of 1.75 and a debt-to-equity ratio of 0.16. The stock has a market cap of $1.05 billion, a P/E ratio of 9.20, a PEG ratio of 1.78 and a beta of 0.43. Yelp has a 52-week low of $17.26 and a 52-week high of $34.49. The firm’s 50-day moving average is $19.84 and its 200 day moving average is $23.52.

Yelp News Roundup

Here are the key news stories impacting Yelp this week:

• Positive Sentiment: Yelp reported Q3 adjusted earnings of $0.63 per share, above the $0.43 analyst consensus, while revenue of $370.9 million also modestly exceeded estimates of $368.7 million. Yelp Q3 earnings and revenues surpass estimates
• Positive Sentiment: The company is targeting a $250 million annualized run rate for “other” revenue by the end of 2028, a longer-term effort to broaden revenue sources beyond its core business. Yelp’s Q4 outlook and 2028 revenue target
• Neutral Sentiment: Yelp’s FY 2026 revenue guidance of about $1.5 billion was in line with consensus. The company also highlighted continued AI product development, including updates to its Yelp Assistant, though the near-term financial impact is unclear. Yelp reports third-quarter 2026 results
• Negative Sentiment: Revenue fell 1.4% year over year, and Q4 revenue guidance of $347 million to $352 million points to a sequential slowdown from Q3. A Seeking Alpha analysis also flagged erosion in ad clicks as a potential warning for Yelp’s advertising business—likely concerns that offset the earnings beat. Analysis of erosion in Yelp ad clicks

Analyst Upgrades and Downgrades

Several research analysts have commented on the stock. The Goldman Sachs Group reissued a “neutral” rating and set a $23.00 price objective on shares of Yelp in a report on Friday. Zacks Research raised shares of Yelp from a “hold” rating to a “strong-buy” rating in a research note on Tuesday, October 27th. Weiss Ratings reissued a “sell (d+)” rating on shares of Yelp in a research report on Wednesday. Morgan Stanley reduced their price objective on Yelp from $24.00 to $17.00 and set an “underweight” rating for the company in a research note on Tuesday, October 13th. Finally, JPMorgan Chase & Co. assumed coverage on shares of Yelp in a research report on Friday, September 11th. They set an “underweight” rating and a $19.00 price objective for the company. One equities research analyst has rated the stock with a Strong Buy rating, one has given a Buy rating, three have issued a Hold rating and three have assigned a Sell rating to the stock. According to MarketBeat, Yelp currently has a consensus rating of “Hold” and an average price target of $25.29.

Insider Activity at Yelp

In other Yelp news, CTO Alexander Coleman Levy sold 3,829 shares of the stock in a transaction that occurred on Monday, August 24th. The shares were sold at an average price of $23.40, for a total value of $89,598.60. Following the completion of the sale, the chief technology officer owned 54,124 shares in the company, valued at $1,266,501.60. This represents a 6.61% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CFO David A. Schwarzbach sold 7,500 shares of the business’s stock in a transaction on Wednesday, October 21st. The stock was sold at an average price of $20.00, for a total transaction of $150,000.00. Following the completion of the sale, the chief financial officer owned 165,466 shares of the company’s stock, valued at $3,309,320. The trade was a 4.34% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 28,638 shares of company stock worth $614,249 in the last 90 days. 8.30% of the stock is owned by company insiders.

Yelp Company Profile

Yelp Inc operates an online platform that helps consumers discover and evaluate local businesses. Through its website and mobile applications, Yelp provides business listings, user-generated reviews, ratings, photos and other information across categories such as restaurants, home services, beauty and fitness, automotive, health and professional services.

The company generates revenue primarily by providing businesses with advertising and marketing solutions designed to increase their visibility and connect them with potential customers.