Thank you for standing by. At this time, I would like to welcome everyone to today's Q4 2025 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. If you'd like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. Once again, star one. If you'd like to withdraw your question, simply press star one again. Thank you. I would now like to turn the call over to Josh Willis, Investor Relations Manager. Josh? Good afternoon, everyone, and thank you for joining us on Yelp's fourth quarter and full year 2025 earnings conference call. Joining me today are Yelp's Chief Executive Officer, Jeremy Stoppelman, Chief Financial Officer, David Schwarzbach, and Chief Operating Officer, Jed Nachman. We published a 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 has been 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. With that, I will turn the call over to Jeremy. Thanks, Josh, and welcome everyone. Yelp delivered record net revenue and strong profitability in 2025, driven by our focus on services and accelerated pace of product innovation. We introduced more than 55 new products and features, many powered by AI, as we continue to transform the experience for consumers and businesses. Overall, in 2025, net revenue increased by 4% year-over-year to $1.46 billion. We grew net income by 10% year-over-year to $146 million, representing a 10% net income margin. This resulted in 19% year-over-year growth in diluted earnings per share to $2.24. Adjusted EBITDA increased by 3% year-over-year to $369 million, representing a 25% adjusted EBITDA margin. Underlying our results, the operating environment for our RR&O categories remain challenging, with revenue from these businesses declining 6% year-over-year to $444 million. At the same time, services drove our business performance, with advertising revenue from businesses in these categories up 8% year-over-year to a record $948 million, due to the strength in advertising demand and reflecting record revenue per location. Excluding projects acquired through our paid search initiative, request to quote projects increased approximately 15% year-over-year, driven by improvements to the flow and increased adoption of Yelp Assistant. Our AI chatbot continued to resonate with consumers in 2025, with request to quote project submissions through Yelp Assistant up more than 400% year-over-year, representing approximately 5% of all request to quote projects during the year. Total ad clicks decreased 7% year-over-year, driven primarily by macro pressures and, to a lesser extent, reduced spend on paid project acquisition in 2025 compared to 2024. Average cost per click increased 10% year-over-year, reflecting growth in advertiser demand in our services categories and fewer clicks overall. Total paying advertising locations decreased 3% year-over-year as softness in RR&O offset growth in services, while average revenue per location reached an annual record. Other revenue accelerated significantly, up 17% year-over-year, driven by growth in transaction, subscription, and data licensing revenue. We also continued to grow our review content in 2025. Yelp users contributed 22 million new reviews, bringing cumulative reviews to 330 million. App unique devices were down 2% year-over-year as consumers visited restaurants with reduced frequency. Over the past year, we meaningfully increased our focus on transforming Yelp with AI. We believe combining our authentic human-generated content with advanced AI presents a significant opportunity to redefine how people connect with local businesses. We plan to build on our progress by investing in three strategic initiatives in 2026. First, we are reconceiving the Yelp experience to focus on delivering answers and actions. We set the stage for this in 2025 by introducing natural language search, launching AI-powered business highlights, and expanding Yelp Assistant to RR&O business pages. We plan to further expand Yelp Assistant in 2026 to function across categories and entry points, with the goal of making local discovery and task completion seamless. We began testing this comprehensive experience in the fourth quarter and expect to fully roll it out by the end of the first quarter. To further close the loop between discovery and action, we expanded our food ordering network by adding hundreds of thousands of new restaurants through our DoorDash partnership and integrated RepairPal's booking system into Yelp. Second, we are delivering AI tools that help service pros and other local businesses grow, operate, and succeed. Building on years of investment in delivering value to our advertisers, our focus is shifting toward becoming an even more valuable partner for businesses by helping them operate more efficiently through AI-powered tools. In 2025, we introduced Yelp Host, our AI-powered call answering service for restaurants, which has answered more than 190,000 calls and handled thousands of reservations since launch. In 2026, we plan to roll out further upgrades, including the ability to take food orders over the phone. To accelerate our broader strategy, we recently closed our acquisition of Hatch, a leading AI lead management platform for service pros. With this acquisition, we've now shifted our focus in lead management from Yelp Receptionist to supporting the rapid growth of Hatch. Lastly, we are further extending our reach to power local discovery across the AI ecosystem. As search evolves towards AI, we believe the value of our first-party data, including 330 million reviews, nearly 500 million photos, and more than 8 million business listings, is becoming increasingly clear. In 2025, we saw strong demand for our data licensing products, and we recently signed an agreement with OpenAI. We believe we are well-positioned to be the essential partner, providing trusted local content and enabling actions whenever consumers are making local decisions. In summary, our focus on product innovation and a differentiated services experience once again drove our results in 2025. Looking ahead, we are confident in our ability to transform Yelp with AI in ways that play to the strengths of our business. We plan to increase our investments in 2026, inclusive of our recent acquisition of Hatch, to capitalize on this opportunity and deliver long-term sustainable growth. With that, I'll turn it over to David. Thanks for that full year review, Jeremy. Before I discuss our fourth quarter results, I'd like to take a moment to highlight the progress we've made transforming Yelp's business over the last five years through our product-led growth strategy and disciplined expense management. Through our commitment to share repurchases, we've reduced our fully diluted share count, which includes outstanding stock options, RSUs and PRSUs from 86 million to 67 million, a 22% reduction between December 31, 2021, and December 31, 2025. Combined with our demonstrated profitability, this drove earnings per diluted share of $2.24 in 2025, a more than fourfold increase from 2021. In short, Yelp enters 2026 from a position of greater financial strength, with net income of $146 million in 2025, Adjusted EBITDA of $369 million, cash flow from operations of $372 million, and record free cash flow of $324 million. Turning to our fourth quarter results, net revenue decreased by 1% year-over-year to $360 million, $2 million above the midpoint of our outlook range. Net income decreased by 10% year-over-year to $38 million, representing a 10% margin. Adjusted EBITDA decreased by 15% year-over-year to $86 million, $7 million above the midpoint of our outlook range, representing a 24% margin. As Jeremy mentioned, top-line growth was driven by performance in our services categories throughout the year. Advertising revenue and services increased by 3% year-over-year in the fourth quarter to $231 million. Conversely, restaurants and retailers remained pressured in the quarter, resulting in a 12% year-over-year decline in our RR&O revenues to $107 million. A decrease in our RR&O locations, combined with flat services locations in the fourth quarter, resulted in an overall decline of 5% year-over-year in paying advertising locations to 496,000. Turning to expenses for the year, our 2025 results highlight both our ability to deliver profitable growth and the margin potential of our product-led strategy, with a net income margin of 10% and an Adjusted EBITDA margin of 25%. We again kept headcount approximately flat year-over-year in 2025, demonstrating our continued commitment to disciplined expense management. We see a significant opportunity to drive growth in other revenues through our AI transformation and plan to increase our investments to capitalize on this opportunity in 2026. Excluding the recently integrated Hatch team, we expect headcount growth to again remain approximately flat year-over-year in 2026, reflecting both our commitment to driving leverage in the business through our product-led strategy and our team's ability to deliver operational efficiency using AI. We also remain focused on increasing the quality of our Adjusted EBITDA. In recent years, we have taken significant action to shift our compensation mix between stock and cash. While we expect the full impact of these efforts to stack over time, in 2025, we were able to reduce stock-based compensation expense as a percentage of revenue by 2 percentage points from the previous year. In line with our target set in 2023, SBC, as a percentage of revenue in the month of December 2025, declined to below 8%. We continue to expect that we will reduce SBC expense to less than 6% of revenue by the end of 2027. In 2026, we are deploying capital to support our growth initiatives through investments in our AI transformation, our acquisition of Hatch, and incremental investment in paid search. We intend to continue evaluating potential strategic acquisitions and repurchasing shares, subject to market and economic conditions. In 2025, we repurchased $292 million worth of shares at an average purchase price of $33.29 per share, including $88.5 million worth of shares repurchased in the fourth quarter. As of December 31, 2025, we had $38.8 million remaining under our existing repurchase authorization. To support our ongoing repurchase plans, in February 2026, our board of directors authorized an additional $500 million for share repurchases. Turning to our outlook, we continue to believe in the significant long-term growth opportunities ahead as we focus our investments on high-return areas. We expect many of the same trends that characterized 2025 to persist into 2026, continuing to negatively impact advertising revenue for the year. We anticipate the opportunity in other revenue and services to continue to drive our business performance, while our RR&O remains pressured. As a result, for the first quarter of 2026, we expect net revenue will be in the range of $350 million-$355 million. For the full year, we expect net revenue will be in the range of $1.455 billion-$1.475 billion. Turning to margin, we anticipate expenses will increase seasonally from the fourth quarter of 2025 to the first quarter of 2026, primarily driven by payroll taxes and benefits. As a result, we expect first quarter Adjusted EBITDA will be in the range of $58 million-$63 million. For the full year, we expect expenses to increase, driven primarily by investments in our AI transformation, in paid traffic acquisition, and in Hatch operations. As a result, we expect Adjusted EBITDA for the full year to be in the range of $310 million-$330 million. In closing, Yelp's 2025 results reflect both disciplined execution and the margin potential of our product-led strategy. We continue to believe in the opportunities ahead to create shareholder value over the long term as we invest in our AI transformation to drive sustainable business performance. With that, operator, please open up the line for questions. Thank you so much, and at this time, I would like to remind everyone, in order to ask a question, press star, then the number one on your telephone keypad. Once again, star one. And we will pause just a moment to compile the Q&A roster. All right, looks like our first question today comes from the line of Robert Coolbrith with Evercore ISI. Robert, please go ahead. Great. Thanks for the opportunity to ask a question. Just wanted to ask about the environment for services, both on the consumer and the service provider side. So you saw some deceleration, in Q4 in revenue and, a little bit steeper, sequential decline in Services PALs, this year versus last. Just wondering if you could maybe comment on that a bit and what you're looking for from, the services business in 2026. Then I'll just have a quick follow-up on OpenAI. Thank you. Sure. I can kick things off here, Robert. Thanks for the question. You know, services demand, I think, has softened a bit. You know, where we really see it hit hard, in with respect to the consumer and the overall macro environment was RR&O. But, you know, I would say it's, it's spilled over to services somewhat, not to the same extent, obviously. You know, so then it gets to the question of, of what are we doing? Well, we're really leaning in, with Yelp Assistant. So that's our key investment there. You know, we've been working on that for some time, particularly in the services side, but, we rolled it out last year to businesses business pages, and we're looking forward to bringing it cross-category. We think transforming the consumer experience through AI is really a great opportunity for us. You know, obviously, AI is a very disruptive force for a lot of companies out there. And so we're really riding that wave. We think consumers are going to expect to have a more chat-like interface in general to a service like Yelp, and so we're eager to bring that to our consumers, drive engagement. And of course, as those users engage with it in high-frequency categories like restaurants, you expect them to eventually get to services categories as well. And, you know, when you're in Yelp Assistant, that's a fully monetized experience with Request to Quote. So we're really excited to get that out. We expect to begin our launch in towards the end of Q1 here. And that, that's just the beginning, of course. We plan to continue to invest in that to bring other actions into Yelp Assistant. So things like making reservations or booking appointments or having a service provider show up at your house, those are all on the roadmap, so we're looking forward to executing on that. And then, we're continuing to lean into multi-location services. That's a big opportunity there. We've historically been under-penetrated. We've made a lot of progress. We've also found ways to deliver additional traffic, go out and acquire some traffic for those customers, and that can generate incremental revenue as well. So we do have a lot of bets that we're placing this year, you know, that can improve things on the services side. Look forward to reporting back on that. Great. Thanks. And just on OpenAI, anything you'd tell us maybe about the general outline of the deal, if that could be a positive factor for traffic, exposure to younger user cohorts, and so forth, in addition to whatever monetization opportunity there might be. Thank you. Sure. Yeah, I'll take this one as well on OpenAI. Great to have an agreement there. A couple of quarters ago, we flagged for investors that, hey, we were seeing really high-quality conversations in that area. Deals were being signed. It was still early days, and I think, you know, this is an important milestone on that journey. Yelp has really great content, millions of human-written reviews, really critical content, critical information. If you want to deliver an experience, you know, a general search experience, eventually, those consumers are gonna be asking questions with local intent. That's, you know, historically. You know, Google's reported that something like 50% of queries on traditional search have local intent. And if you're trying to compete with Google, like many of these folks are, you really need that high-quality content, and Yelp has it. And so we're seeing that reflected both in this agreement as well as others, and the conversations are continuing. This isn't the last one we expect to do. I guess, I would finish with, you know, where does that show up on the revenue side? You know, other revenue is where data licensing lives. It's up 17% year-over-year, and actually in the fourth quarter, that accelerated, and was up 30% or 33%. Got it. Great. Thank you very much. Sure thing. Thank you, Robert. Our next question comes from the line of Jason Kreyer with Craig-Hallum. Jason, please go ahead. All right. Great. Thank you. So you talked about this AI transition. Just wondering if you can talk about what that looks like through the lens of the consumer. Like, how does this evolve in terms of consumers interacting with Yelp and consumers interacting with your customers over time? Yeah, happy to answer that. Yeah, yeah, obviously, AI is a very disruptive force, and I think it's changing consumer expectations. You know, how are we approaching that? Well, first and foremost, on the consumer experience, we're really trying to leverage AI everywhere that we can. We've rolled out lots of features that are powered by AI. One of the first things we did was enhance our search, so you can actually enter natural language queries in there and get back much better answers than you could, you know, prior to that. But with Yelp Assistant, that was our foray. We've been working on that for some time, you know, conversational. Initially focused on the services experience that has driven a lot of projects, incremental projects. And in fact, as we rolled it out, we've seen really great adoption there, up 400% in terms of projects going through Yelp Assistant. You know, fast-forward a little bit there, and we brought it to business pages. And so now consumers, which more frequently they're having this expectation of you, you land on a business page, you don't want to read through all the information. You just want to get, you know, the needle in the haystack. And so consumers are now able to do that, type in a question about a business. It digs into the photos, it digs into the reviews, and it comes back with relevant information. And that was sort of a milestone on our way to where we're headed towards the end of this quarter, which is a cross-category Yelp Assistant. And that's really exciting because you can ask it, you know, any question about a local business or, you know, what your need is, or whether it's a service request, it'll guide you through that process and ultimately match you with businesses. One of the great things, you know, back to that needle in a haystack comment, is that we're able to back up a user's question or user's request with great data. So photos that are an example of what they're looking for or, you know, snippets right out of reviews and get really precise. We think that's gonna delight consumers. Ultimately, that's our goal. And I think, you know, with the changing search landscape, everything going, or, you know, some portion of share going to a more, generative AI or, you know, a ChatGPT-like experience, consumers are changing their expectations, and they don't just want regular search. And so we've put a significant investment in transforming the Yelp experience and preparing for the future, and, you know, we'll get our first taste of that as we launch Yelp Assistant at the end of Q1 here. I guess on, you know, other areas where we're using AI to transform, you know, I guess I would point to the opportunity that we see in SaaS tool, AI-powered SaaS tools. So as you probably know, we launched Yelp Post and Yelp Receptionist last year. Yelp Post is fantastic. You know, we're seeing a great response from restaurants. You know, sales are above our initial expectations. We've answered over 190,000 calls, so great momentum there. And on the Receptionist side, you know, we did get the opportunity to pair up with Hatch. We're delighted. I think that accelerates our roadmap there by a couple of years. You know, they were a first mover in the space, and we're able to bring our extensive distribution as well as AI capabilities and talent to bear on the Hatch opportunity that, y ou know, both are going after very large TAMs. So we're extremely excited about the AI SaaS opportunities ahead of us. Yeah. Maybe just sticking with Hatch on a follow-up. Just curious what that cross-sell looks like for Hatch's services, and then if there's any Hatch functionality that will kind of accelerate the roadmap on Host as well. Thanks. Yeah. I mean, we're already talking to a lot of the same customers, and then there's, you know, plenty of contacts that we have that we can introduce Hatch to. So I think that's a really exciting opportunity. You know, they're a relatively small team. We have thousands of sales reps. I think, you know, there's also a benefit too, in that if you get more efficient at managing leads by leveraging AI, your return on advertising is better. So that's kind of an extra win-win in there. So, you know, very excited about Hatch just going after a big TAM, and they're growing rapidly, 70% year-over-year growth. So exciting times there. Thank you. All right. Thank you, Jason. Our next question comes from the line of Nitin Bansal with Bank of America. Nitin, please go ahead. Sure. Thank you for taking my question. So, AI innovation is accelerating at, like, a very rapid pace, particularly as large platform disturb traditional advertising and software models.... As you expand your AI SaaS offerings with Hatch, what gives you confidence that your product innovation can keep up with the leading players, and you will be able to achieve the adoption level that you're targeting for? Thank you. Sure. Thanks for the question. Yeah, how do we expect to keep up a level of innovation, a pace of innovation, such that we can stay ahead of, you know, perhaps bigger players? You know, it's something that we're very familiar with. You know, obviously, for many years, we've competed with big tech players, particularly Google. You know, and how we've been successful is, I think, our focus. You know, it's early days in the space that Hatch plays in, which is AI lead management for service pros. They're, you know, laser-focused, they understand their customers, they understand the players in the ecosystem, they have key partnerships that are essential to make that work. There's just a level of detail, and focus that I think is very hard for other companies, especially large ones that have other big opportunities to pursue, to spend their time on. You know, so we're quite confident that this is an opportunity with a lot of runway and, you know, Hatch has great momentum, and we're—You know, our view is: how do we help? You know, they're doing great. The 70% growth, year-over-year is fantastic, and we wanna see if we can, you know, make that even go even faster. So we're bringing our resources to bear, we're bringing our distribution to bear, and they're really experts in the, in the space, and I don't, you know, I think that's very hard for someone to replicate if they've got lots of other large opportunities to chase, like, you know, some of these bigger AI players. Thank you. If I can ask one more. Looking out five years from now, how do you envision the revenue mix to evolve between, like, recurring subscription revenue versus variable ad revenue? And what would it mean for your, like, overall top line growth and margin profile, like, two to five years down the line? Thanks for the question, Nitin. We do see the opportunity to diversify revenue by continuing to drive other revenue. Just as a quick reminder, other revenue consists of three components. There is the licensing revenue, there is transaction revenue, and things are going well with DoorDash. We're very happy there. And then, of course, there's the subscription revenue. With this significant opportunity across the SaaS landscape, especially with our distribution, we do see the opportunity to diversify our total revenue mix, which is obviously heavily ad-driven today. So yes, that's definitely an opportunity from our perspective. Obviously, as well, there are different margin profiles between SaaS performance and for SaaS business models and ad-driven business models. That being said, when you look at over time, where do SaaS businesses go in terms of margins, it's also very attractive. My expectation is that our SaaS, our ability to drive, SaaS margins will converge with where we are or better than the ad revenue. As a reminder, when you look at licensing or transaction, that is almost entirely margin, so that's a very nice mix there for us. I'd say overall, other revenue today already has, in aggregate, a better margin profile than the ad side of the business. Thank you. Thank you, Nitin. Just a reminder, ladies and gentlemen, if you'd like to ask a question, again, star one on your telephone keypad. Once again, star one. Our next question comes from the line of Kishan Patel with Raymond James. Kishan, please go ahead. Hi, this is Kishan Patel, I'm for Josh Beck. Thanks for taking the question. In restaurants and retail, what do you think needs to change for that advertiser base to stabilize and then improve? And how would you prioritize those changes over the next few quarters? Yeah, thanks. I can take that question. This is Jed speaking. You know, obviously, there have been some headwinds in restaurant, retail, and other. You know, we saw those over the course of 2025. There is, you know, a lot of these restaurants are dealing with a weakened consumer, and, you know, there's additional pressure of, you know, really high input costs that makes it, you know, a tough battle out there on Main Street from the local economy. You know, we do believe that over time, you know, in restaurant dining will return and that we're very well positioned for that. I think when you look at the transformation of Yelp, and Jeremy had mentioned Yelp Assistant, cross-category Yelp position. Yelp Assistant, that's gonna provide a, you know, an entirely new interface for consumers to interact, you know, with all of the Yelp data, and we believe the investment there will position us well when you know, a lot of this stuff comes back. But we're not resting on our laurels. You know, Jeremy mentioned the Yelp Post, and we've been thrilled with the progress there thus far. We believe there's a very large TAM. You know, I think, as we mentioned in the letter, we're gonna be... We'll soon have food ordering, you know, available on that Yelp Post product. And I believe we're really well-positioned from a voice perspective and it is obviously a very large TAM that we can go after and bring our existing infrastructure to bear on that opportunity. So, you know, overall, we're gonna continue to invest in that consumer experience and, you know, also see other opportunities to drive on those AI-based SaaS tools. Got it. And, regarding Hatch, can you provide more color on the margin trajectory goals for Hatch after closing, given the cash flow disclosure, and how that impacts the full-year EBIT outlook versus, the core business? Thanks for the question. It's David. Because Hatch is growing very rapidly, we remain focused on driving that top-line growth. Margin, driving margin is not the immediate focus for us. We actually wanna go and really realize the opportunity by providing the solution to as many service pros as we can. Again, I do think over time that the margin profile will converge with the typical SaaS margin profile, but that's not immediate. So it is reflected in the guidance that we've given on Adjusted EBITDA for the year from an operating expense perspective. Just as a side note, the retention amounts that we are paying out are being added back to EBITDA, so we're adjusting those. You can see those numbers in the shareholder letter, just for reference. But what we want to really achieve right now is this significant growth in realizing the opportunity from the acquisition. Thank you. All right. Thanks, Kishan. That does conclude our Q&A session today, as well as our call. Thank you so much for joining us today, and you may now disconnect. Have a great day, everyone.