Great. Thank you everyone for attending. We have Yelp here. David Schwarzbach, the CFO of Yelp. Thank you for attending, and excited to have this conversation. Thanks, Sergio, for having us at the conference. We will be making some forward-looking statements during the conversation today that are subject to risks and uncertainties. Please refer to our SEC filings for more information on the risk factors that may affect our results. Awesome. With that, we can get started. Maybe just to level set for the room, you just reported 2Q results last week. Maybe just a high-level recap of what you saw, what you are seeing across consumer demand, your advertisers, and the visibility you have into the back half of this year. Yeah. We posted our Q2 results last week, and a theme for us has been the local physical economy has been pressured through, it started in 2025, and it is certainly been the case here in 2026. In particular, on our restaurant, retail, and other side, which we are really best known for, that was down 10%. Our services business, which is now 70%, was actually flat on the year. Overall, we did it, we are up 1%. That local physical economy, why is that happening? There is a combination of things. You can really put it down to inflation. Consumers have seen prices go up a lot. They are unwilling to pay more, and then the input costs for these businesses just keep going up, whether it is on the services side, the materials. There is less labor, so labor costs seem to be up. On the restaurant side, it is ingredients. Imports obviously have tariffs on them, and so margins have been squeezed and consumers are more reluctant, so there are fewer dollars going into advertising. That was definitely a big theme for us. At the same time, we have what we call other revenue. It consists of three categories. We will talk more about them. Transaction, subscription, and licensing. That grew 98%, so obviously want to talk more about that. I think the thing that did surprise us a little in the second quarter, but we were quite pleased to see, was incremental traffic on the SEO side. That was both due to some algo changes at Google, as well as work that we are doing on SEO. Then we also saw improvements in app downloads, both from the traffic we were getting to mobile web, but also from some of our partners. That certainly, we bucked the trend in the second quarter on that traffic acquisition piece, and so that was certainly encouraging. Great. Let us stick on that SEO point, because I think that is interesting, where we have heard from a lot of companies throughout the space where SEO has actually been a headwind, but it sounds like, as you said, you have bucked the trend there. So maybe explain why you saw some positive momentum in the quarter? We believe that is happening for a couple of reasons. One, first, the categories that we serve are categories that highly monetize on Google as well. So they do not want to interrupt that monetization for themselves, and so we are an indirect beneficiary, is our presumption. Obviously, we cannot be certain about that. What does seem more clear is that the algo changes that Google has been making, and this is both here in 2026, but we also saw it in 2025, really focusing on human-generated content. Of course, Yelp is human-generated content in the form of reviews, and we put a lot of effort into ensuring the quality of those reviews. So we actually deprecate about 25% of the reviews that we receive to ensure that quality, and so we think that that is actually being rewarded. At the same time, there are a lot of technical aspects to SEO that we've been working on, and that's been actually an effort that's gone on for some time now, and we're seeing some of the fruit of that. One of the benefits, of course, is if you're able to generate this human-generated content, and you're able to present it to Google in a way that the algo prefers, that's where the technical piece meets the preference on their side, then you see more traffic. So that has been good for us. That sounds like that's coming more from traditional Google queries versus LLMs. Can you maybe talk about what you're seeing from a traffic dynamic on consumers adopting LLMs? How is that impacting your business? Yeah. So it's still really early on the LLM front. Interestingly, of course, Google still has its dominant market position. That's unchanged. At the same time, we're encouraged. We see these third-party studies. We've done some work of our own, and it seems like Yelp is one of the top reference sites across LLMs. Again, I would just chalk that up to the fact that we have this human-generated content, and we put so much into the curation of that content, and it is highly relevant to what consumers are looking for. Depends on the source, but it seems like 25% to 35%, maybe even 40% of search has local intent to it. If you're an LLM and you want to be in search, then you certainly have to produce good local search results. Of course, we think that that means you need to work with Yelp. Makes sense. Let's dive a little bit more into the advertising business. Services, I think when you think Yelp, you think services. A lot of people, their first thought is home services. Maybe talk about the breadth of the offering across verticals within services particularly, and where you see opportunity to increase your penetration. Those of you who aren't familiar with our services offering, there's two ways to find services on Yelp. One is that traditional search. We're going to show you a list of businesses with advertisers at the top and organic results below that with a variety of ad formats. We also have what we call Yelp Assistant. Yelp Assistant is our chat experience. We've had that for about a year on the services side, and we just expanded it to cover all categories. Within the services side, that Yelp Assistant will present up to four results for the person who's doing the search. Now, if you go through that traditional search site, it's one click. On the Yelp Assistant side, which is powered by Request a Quote, that's going to be four clicks. It monetizes a dramatically higher rate, and certainly we want to see more traffic flowing through there. Request a Quote was up 10% in the second quarter, and we continue to present that in the Yelp Assistant experience. We think that there's a lot more room for us to make people familiar with that Yelp Assistant, and then, of course, Request a Quote within the Yelp Assistant experience. What percentage of services requests today are going through Yelp Assistant, and what's the gating factor to increasing that and more broadly? Yeah. There's still plenty of room to run. We haven't specifically shared the breakdown, but it's a meaningful percentage. It's growing quite nicely. Again, because it's four times the clicks for the traditional search, even as a smaller percentage, it still punches above its weight because you're seeing more revenue coming from that side. So there's still a lot more that we can do there. Just fundamentally, I think we're all having this experience, which is we're still all figuring out what is the exact right search experience in a conversation. One of the things that we really pride ourselves on right now is the format that we've taken Yelp Assistant, which is going to support, we think, additional monetization on that chat side, which is, Hey, I'm searching for this, and then you get the result. In what we've developed, we actually explain or tell you why we picked that business. You really don't find that in other search experiences. It is a very engaging way to do it. It uses LLMs, of course. Based on the query, we are obviously able to make it very relevant to you. But equally important, we then present the evidence. Why did we pick that for you? Here is why we picked it, and this is why we have confidence this was a good pick for you. There is a lot more that we can do there and surface that kind of high-quality, high-reliability content to consumers. At the end of the day, I think we have all had this experience with large language models. Sometimes it gets it right. It is always confident, always feels- Right expresses itself in a way that suggests that it thinks it is right. Yet, as soon as you give it a little thought, you are like, I am a little puzzled by this result, or it is just flat wrong. We have also put a lot of work into ensuring that our conversation experience is accurate. Because we can present that evidence, you can know in that experience that it is correct. That is the big differentiator for us. Got it. Let us just focus to RR&O. As you said, I think revenue was down approximately 10% on the quarter. That part of the business has been challenged by the macroeconomic environment for a little bit now. The question is really, as we wait for the macroeconomic environment to improve, what initiatives are you doing today to position that- Yeah business for growth? Absolutely. Fundamentally, as a publisher, we need to provide leads to our advertising customers, so we remain very focused on lead quality. People want to earn a return on ad spend, ROAS, and so we are continuing to invest in the matching algorithm. One of the beauties of conversation is you can elicit more information that makes your matching more accurate. We are not just about maximizing the number of clicks. In our algorithm, our auction algorithm, which matches the consumer with the business, it is really trying to optimize between clicks and CPCs. So that is something that we always continue to work on. Then there is just bringing, obviously, additional information in. People are uploading a lot of photos and videos on Yelp, a tremendous number. We are also analyzing those in order to continue to improve the quality of the matching, so that when someone sees it and they see those photos, or we encourage pros to upload really high-quality photos, they get picked, and so they see that lead convert. Another aspect, which I am sure we will talk about, is we made an acquisition in the first quarter of a company called Hatch. It is AI lead gen, and working that click to turn it into a lead. So that fits perfectly. What do we do? We are an advertising platform. Someone clicks and comes to the ad platform, we want to make sure that their service pros are working that lead as effectively as they can. In the industry, speed to lead is the phrase that everybody uses. You have got to be able to respond quickly in a high-quality way, engage that person before your competitors, and then, of course, turn that into an appointment. So that acquisition, of course, we are focused on generating the subscription revenue there and capturing what is a really big market opportunity. But it fits squarely on the ad side as well. Understood. I definitely want to talk about a lot of the exciting initiatives you have in other revenue, which Hatch is one of them. Before going there, maybe bigger picture on the core advertising business. How should we think about just the long-term growth algorithm of that business when it comes to getting more advertisers on the platform, pricing, new products, et cetera? Mm-hmm. Absolutely. 90% of Yelp's revenue comes from ads. We care a lot about ads. Fundamentally, we want to make sure that we're well-positioned as we see the local economy improve and hopefully inflation stabilize there. There's a variety of things that you want to do. I've already talked a lot about Yelp Assistant and making it conversational. That's certainly the largest area of investment, but also our home feed we've modernized over the past couple of years. There's the desire to constantly improve the ad formats, new ad formats, something called whole-page optimization. That's where you want the layout to be the optimum for the query for that consumer. To surface the right advertisers is another domain that we look at, continuing to refine the way that we enable advertisers to indicate to us what their willingness to pay is for a given lead. There's a lot of things that we will continue to do, and that spans both services and restaurant, retail, and other. Fundamentally, we want to be right there and able to deliver value to those advertisers as things improve. Got it. Understood. Let's stick on Hatch. You've made some investments, you called out in the shareholder letter some investments that you made into Hatch. Maybe just give a little bit more background onto that, and then as we evaluate that business in particular, call it over the next 6-12 months, what milestones do you think investors should be focused on? We have invested in Hatch. Obviously, we made this acquisition in the first quarter, as I mentioned, a $300 million acquisition, $270 million in consideration, $30 million in retention. We have added both on the go-to-market side as well as the product and engineering side. Clearly, voice is a big topic right now for everybody, and service pros in particular want to have after-hours capability. They also want sales coaching, so when someone calls in, how can we make sure that if a human is answering that call, how can we coach them to be as effective as possible in being able to convert that to a lead? Those are the immediate opportunities for us, plus what Hatch already does extremely well, which is the text-based lead management. We want to continue to refine that. I think there are really opportunities to take what is, now that we have owned the company for several months, it is a terrific product. It is a powerful product, and because it has a lot of capabilities, sometimes it is important to be able to just present that easy, immediate use case. There is a little bit going on, just, hey, we want to make this as easy to use so they get immediate value, while you discover those greater capabilities, and you can just drive even more value. That is a little bit of what is going on as well. I would just say thematically, it is about continuing to expand the product capability and adding voice. On the go-to-market side, of course, they are a startup, we are an at-scale platform, and there are a lot of things that you want to do to enable a scaled go-to-market team to be productive and effective. We have been putting in place a lot of the instrumentation and metrics and processes that will enable us to ideally drive market share over the coming year. I think it is pretty straightforward. Where are we? We just made this acquisition. We want to operate it effectively and grow it rapidly. That is the measure for the next year. Then in time, I think there will be additional opportunities for us to share with folks. But the first order of business is, of course, to land it, to integrate it, to get all of that set of capabilities from startup to a more scaled platform. Understood. How do you think about monetizing Hatch? Businesses have leads that start on Yelp. They have leads that start outside of Yelp. How do you think about balancing on-platform versus off-platform? Hatch is agnostic. Absolutely agnostic. They serve customers who are getting leads on Google, Angi, ourselves, others. We do not in any way try to put our finger on that scale. We want Hatch to be trusted by all advertisers, and you do not need to be a Yelp customer in order to use Hatch. Absolutely fundamental for that business to be successful. Of course, we want to continue to do our best to make those leads as valuable as possible to our customers. It's both offering that service, but also gaining insight, too. Hey, we see on Hatch how a Yelp lead is being worked, how it's converting. That is information that we can put back to the product side to help us to improve that. That's a very good feedback loop there that is extending our capabilities from where we were, which was, hey, we delivered the click. Now it's we're delivering the lead, and how do we continue to improve that? Understood. Let's move on to data licensing. I think you have several initiatives right now, several ways you are monetizing your data outside of Yelp. Maybe just give us a broad lay of the land of- Sure what you're seeing there. We have a broad set of partnerships. We are quite proud of our partners. We have been on Apple for quite a long time. We are on Microsoft Bing. We have been on Amazon Alexa for some time now. We are on Amazon proper. We signed a partnership with Meta in order to bring that content to their products in the past several months. We have signed OpenAI. On the OpenAI front, we have announced, well, they are bringing out their local search experience. They are adding business pages. We are powering those business pages. We have an enormous directory, 10 million businesses in the United States, so we are showing up there. That is one area. Just today, we shared that you can now book reservations on OpenAI for restaurants that work with Yelp. That is a second area. Last week, we shared that you can now enter the Request a Quote flow on OpenAI, so that is new. When we think broadly about these partnerships, certainly we like the licensing revenue. It is very high margin, but there are two other benefits to us. One is we do get traffic, so we love that, because we are both being paid the license revenue and receiving traffic. Then, of course, these companies are displaying Yelp content branded as Yelp content. Why do they brand it as Yelp content? Because there is high authority in the Yelp brand. If you see, say, a rating of 4.2 and there is no indication of its source, you do not know what to make of it. Is that a reliable 4.2? Is it made up? When you see that Yelp burst, we call it the burst, but the Yelp logo right there next to the rating, you know that it is reliable, and so they want to display it, and the benefit to us is the halo effect. Apple thinks highly enough of Yelp to show Yelp in its results. OpenAI thinks highly enough of Yelp to show Yelp in its results. So we have got that brand halo, brand marketing, impressions, top of the funnel. So you get these three benefits from the licensing, not just the revenue that is coming in. Sounds really interesting. As you can tell, the OpenAI opportunity obviously is exciting for us. Yeah, absolutely. I think the last part within other revenue that's growing really quickly is your DoorDash partners. Yes. Maybe explain what that is, how you guys monetize that as well. Quite straightforward. If you come to Yelp and you click through to DoorDash, we get a referral fee. That has grown quite rapidly, 88% in the first quarter, so we're very pleased with that. They're a great partner as well. I just underscore, if you think about Yelp's place in the world, this human-generated content, highly reliable and curated, it's information that people are seeking out because they want to make good decisions how they spend their money. If you think about Google, we're seeing more traffic from Google. Our licensing partners are the world's largest platforms, Meta, OpenAI, obviously Microsoft. We are being woven into this next era of internet or whatever we end up calling it, and I think that's a powerful testimony to the durability of the content that Yelp has been able to generate over the past 20 years. Great. So I guess, we've talked about the revenue opportunities and other revenue. I am curious, taking a step back, as all of these initiatives scale, how does that impact the cost structure and margin of the business, and how does it differ from the core advertising business? Excellent question. So maybe I will just start with the token cost. I think everybody is very focused on rampant token cost. For us, token cost is actually relatively small. In fact, quite small. On the product side, we do not mind having more token cost. We did not mention, actually, we have a voice AI product for restaurants called Yelp Host that is going quite well. That is food ordering as well as reservations and things like ours. We are able to manage that token cost. Obviously, we want to grow that business. It just hit 1 million calls answered. It is at an over $2 million run rate, $2.4 million run rate. So there is obviously token expense there. Obviously, that is going to be the same thing on the Hatch side, but it is actually quite small. We have architected everything that we are doing so that we can swap out models on the back end. We want to optimize them. We are constantly testing different models. On the productivity side within Yelp, we are also investing. Obviously, everybody is using these AI coding tools in product and engineering, and we are seeing ROI from that investment. For instance, this Yelp Host product, we are able to build that and rapidly iterate on it in a matter of weeks, actually, and it is a very complicated product. So speed to market with new products has accelerated. Prototyping has accelerated. Doing things like migrations and patches has become vastly more automated. So we are pleased with that. But the overall amount that we are spending on tokens is actually a very, very small percentage of our expenses. Now, you asked a different question, which is as we pursue these opportunities in other revenue, how does that compare to the revenue that, or the margins that we have generated on the ad side? Definitely, as we are investing in something like Hatch, you are going to see less margin contribution by design. We want to invest for that kind of growth. Over the long term, our expectation is that a subscription product where you are continuing to improve it and deliver value to customers, you are able to stack that benefit, and you should see the margins normalize to a typical software subscription model. So that is our expectation. That is over the longer term. Just to say the obvious, if we are licensing our content, that is extremely high margin. Then in terms of the ad business, in the second quarter, we were at 24% adjusted EBITDA margin business, and 90% of our revenue still comes from ads, so that gives you the shape of it. Okay, that's really helpful. You guys also made an update to your capital allocation framework on the last quarter. Maybe just highlight what changed there. Sure. In the first quarter, we deployed quite a bit of capital, $125 million for share, $25 million for share repurchases. We also bought Hatch, and we had historically had a cash balance on Yelp, and our capital allocation policy had been return capital in excess of a target cash balance, and we were holding cash on the balance sheet for M&A. We did M&A. So we used it. So we had, at the end of the second quarter, about $100 million in debt on our revolver and about $94 million in cash, so net zero about. What we have decided to move to is an expectation that we would deploy about 50% of free cash flow or more going forward against share repurchases. So we're trying to balance between having firepower for more M&A in the future, nothing to announce at the moment, but also continuing to return capital. Just by the numbers, diluted shares outstanding in the second quarter of 2025, about 64 million, decreased 15% to the second quarter of 2026 to 55 million. So 9 million share reduction in one year, I think, reflects the commitment that we've had to share repurchases. We have paused share repurchases here in 2026, but we expect to resume them in 2027, subject to market and economic conditions, and of course, depending on the type of M&A that we might do in the future. So we're trying to balance between these two things, which is we want to be very disciplined in how we allocate capital. We want to be stewards of that capital, and of course, we want to drive shareholder returns. Great. Well, I think with that, we're out of time. Thank you, David. Appreciate it.