Yelp 2025 Q2 Earnings Strong Performance as Net Income Surges 15.9%

Yelp reported its Q2 2025 earnings on August 8, 2025. The company exceeded expectations with a solid revenue increase and strong net income growth. Yelp narrowed its net revenue guidance for 2025 and maintained disciplined financial management, despite a slowdown in growth amid macroeconomic uncertainty.

Revenue
Yelp’s total revenue for the second quarter of 2025 grew by 3.7% year-over-year to $370.39 million. Advertising remained the largest contributor, generating $353.70 million. The Services segment added $240.80 million, while the Restaurants, Retail & Other category accounted for $112.89 million. Additional revenue came from other unspecified sources at $16.70 million. This performance highlights Yelp’s continued diversification of its revenue streams across multiple business areas.

Earnings/Net Income
Yelp’s earnings per share (EPS) rose 23.2% to $0.69 in Q2 2025, compared to $0.56 in the prior-year period. Net income climbed to $44.09 million, reflecting a 15.9% increase from $38.04 million. The company achieved a new 15-year high for Q2 net income, underscoring strong profitability and operational efficiency.

Price Action
Yelp’s stock has underperformed recently, declining 2.57% on the latest trading day, 6.08% over the past week, and 10.27% month-to-date.

Post Earnings Price Action Review
The post-earnings trading strategy, which involved buying shares on the report date and holding for 30 days, yielded moderate returns but trailed the market significantly. With a compound annual growth rate of 11.01%, it lagged behind the benchmark by 40.47 percentage points. The strategy recorded a maximum drawdown of 0.00% and a Sharpe ratio of 0.68, indicating minimal risk but limited upside potential.

CEO Commentary
CEO Jeremy Stoppelman credited the company’s product-led strategy for the quarter’s success, highlighting momentum in AI initiatives such as Yelp Assistant and the live testing of Yelp Host, an AI-powered call answering service. CFO David Schwarzbach noted record net revenue and strong profitability, while cautioning that macroeconomic uncertainty continues to impact growth.

Guidance
Yelp provided a narrowed net revenue outlook for 2025 of $1.465 billion to $1.475 billion and an Adjusted EBITDA range of $350 million to $360 million. The company emphasized long-term profitability and innovation but acknowledged potential risks from external factors such as advertiser behavior and macroeconomic conditions.

Additional News
In the three weeks following the earnings report, Yelp announced the launch of a strategic partnership with a major AI platform to enhance its customer engagement tools. The company also unveiled a new board member appointment, expanding its leadership team with a former tech executive known for scaling consumer platforms. Additionally, Yelp announced a revised share repurchase program, reflecting confidence in its financial position and long-term value.