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ZipRecruiter Announces Fourth Quarter and Full Year 2022 Results
Rhea-AI Impact
(Moderate)
Rhea-AI Sentiment
(Neutral)
Tags
Rhea-AI Summary
ZipRecruiter reported $210.5 million in quarterly revenue, marking a 4% decrease year-over-year. However, full-year revenue stood at $904.6 million, reflecting a 22% increase year-over-year. The company achieved a full-year net income of $61.5 million with a 7% net income margin and an Adjusted EBITDA of $184.9 million, resulting in a 20% Adjusted EBITDA margin. Looking ahead, ZipRecruiter anticipates continuing challenges in the hiring market due to economic uncertainty but aims for a 2023 Adjusted EBITDA margin of 24%.
Positive
Full-year revenue increased 22% year-over-year to $904.6 million.
Achieved a full-year net income of $61.5 million, translating to a net income margin of 7%.
Adjusted EBITDA for the full year was $184.9 million with a margin of 20%.
Guidance for 2023 includes an Adjusted EBITDA margin target of 24%, indicating strong operational management.
Negative
Quarterly revenue decreased by 4% year-over-year to $210.5 million.
Employers have moderated hiring plans and reduced recruitment budgets due to economic uncertainty.
Quarterly revenue $210.5 million, down 4% y/y
Full-year revenue $904.6 million, up 22% y/y
Full-year net income of $61.5M, or net income margin of 7%
Full-year Adjusted EBITDA of $184.9 million, or Adjusted EBITDA margin of 20%
SANTA MONICA, Calif.--(BUSINESS WIRE)--
ZipRecruiter®, a leading online employment marketplace, today announced financial results for the quarter and full year ended December 31, 2022. ZipRecruiter’s complete fourth quarter and full year 2022 results, financial guidance, and management commentary can be found by accessing ZipRecruiter’s shareholder letter on the quarterly results page of the Investor Relations website at investors.ziprecruiter.com.
“2022 was a year of strong, profitable growth for ZipRecruiter. Even amidst a volatile jobs environment we were able to deliver 22% revenue growth, net income margin of 7% and Adjusted EBITDA margin of 20%,” said Ian Siegel, CEO of ZipRecruiter. “In the first few weeks of 2023, employers have moderated their hiring plans and reduced recruitment budgets in response to an increasingly uncertain macroeconomic backdrop. While our 2023 revenue guidance is based on the assumption that challenging macroeconomic conditions continue throughout the balance of the year, our 2023 Adjusted EBITDA margin guidance of 24% reflects our ability to navigate dynamic macroeconomic environments while also continuing to invest in our product and matching technology. We believe that the strength of our brand, nimble business model, and robust balance sheet not only position us well to navigate the current macroenvironment, but also allow ZipRecruiter to emerge as an even stronger company on the other side.”
Conference Call Details
ZipRecruiter will host a conference call today, February 21, at 2:00 p.m. Pacific Time to discuss its financial results. A live webcast of the call can be accessed from ZipRecruiter’s Investor Relations website at investors.ziprecruiter.com. An archived version will be available on the website two hours after the completion of the call until Tuesday, February 28, 2023. Investors and analysts can participate in the conference call by dialing +1 (888) 440-4199, or +1 (646) 960-0818 for callers outside the United States. To listen to the telephonic replay please dial +1 (800) 770-2030 or +1 (647) 362-9199 for callers outside the United States.
Forward-Looking Statements
This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements contained in this press release that do not relate to matters of historical fact should be considered forward-looking statements, including statements regarding ZipRecruiter’s beliefs regarding market opportunity and expected hiring activity for the remainder of 2023, statements regarding ZipRecruiter’s expected financial performance for the fiscal year ending December 31, 2023, and other statements that reflect ZipRecruiter’s current expectations and projections with respect to, among other things, its financial condition, results of operations, plans, objectives, future performance, and business. These statements may be preceded by, followed by or include the words "aim," "anticipate," "believe," "estimate," "expect," "forecast," "intend," "likely," "outlook," "plan," "potential," "project," "projection," "seek," "can," "could," "may," "should," "would," "will," the negatives thereof and other words and terms of similar meaning. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements, including our ability to attract and retain employers and job seekers; our ability to compete with well-established competitors and new entrants; our ability to achieve and/or maintain profitability; our ability to maintain, protect and enhance our brand and intellectual property; our dependence on macroeconomic factors; our ability to maintain and improve the quality of our platform; our dependence on the interoperability of our platform with mobile operating systems that we do not control; our ability to successfully implement our business plan during a global economic downturn that may impact the demand for our services or have a material adverse impact on our and our business partners’ financial condition and results of operations; our ability and the ability of third parties to protect our users’ personal or other data from a security breach and to comply with laws and regulations relating to consumer data privacy and data protection; our ability to detect errors, defects or disruptions in our platform; our ability to comply with the terms of underlying licenses of open source software components on our platform; our ability to expand into markets outside the United States; our ability to achieve desired operating margins; our compliance with a wide variety of U.S. and international laws and regulations; our reliance on Amazon Web Services; our ability to mitigate payment and fraud risks; our dependence on our senior management and our ability to attract and retain new talent; and the other important factors discussed under the caption “Risk Factors” in our Quarterly Report on Form 10-Q for the three months ended September 30, 2022 that we filed with the U.S. Securities and Exchange Commission (“SEC”) and our Annual Report on Form 10-K for the twelve months ended December 31, 2022 that we will file with the SEC. There is no assurance that any forward-looking statements will materialize. You are cautioned not to place undue reliance on forward-looking statements, which reflect expectations only as of this date. ZipRecruiter does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise.
Non-GAAP Financial Measures
This release includes certain non-GAAP financial measures, including Adjusted EBITDA and Adjusted EBITDA margin.
We define Adjusted EBITDA as our net income (loss) before interest expense, other income, net, income tax expense (benefit) and depreciation and amortization, adjusted to eliminate stock-based compensation expense. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of revenue for the same period.
Management and our board of directors use these non-GAAP financial measures as supplemental measures of our performance because they assist us in comparing our operating performance on a consistent basis, as they remove the impact of some items not directly resulting from our core operations. We also use these non-GAAP financial measures for planning purposes, including the preparation of our internal annual operating budget and financial projections, to evaluate the performance and effectiveness of our strategic initiatives and to evaluate our capacity for capital expenditures to expand our business.
Adjusted EBITDA and Adjusted EBITDA margin should not be considered in isolation, as an alternative to, or superior to net income (loss), revenue, cash flows or other measures derived in accordance with GAAP. These non-GAAP measures are frequently used by analysts, investors and other interested parties to evaluate companies in our industry. Management believes that the presentation of non-GAAP financial measures is an appropriate measure of operating performance because they eliminate the impact of some expenses that do not relate directly to the performance of our underlying business.
These non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or other items. Additionally, Adjusted EBITDA and Adjusted EBITDA margin are not intended to be a measure of free cash flow for management’s discretionary use, as they do not reflect our tax payments and certain other cash costs that may recur in the future, including, among other things, cash requirements for costs to replace assets being depreciated and amortized. Management compensates for these limitations by relying on our GAAP results in addition to using Adjusted EBITDA and Adjusted EBITDA margin as supplemental measures of our performance. Our measures of Adjusted EBITDA and Adjusted EBITDA margin used herein are not necessarily comparable to similarly titled captions of other companies due to different methods of calculation.
We are not able to provide a reconciliation of Adjusted EBITDA margin for the full fiscal year 2023 to net income margin, the comparable GAAP measure, because certain items that are excluded from non-GAAP financial measures cannot be reasonably predicted or are not in our control. In particular, we are unable to forecast the timing or magnitude of stock-based compensation or amortization of intangible assets, as applicable, without unreasonable efforts, and these items could significantly impact, either individually or in the aggregate, GAAP measures in the future. See the table below regarding a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP measures.
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA (UNAUDITED)
(in thousands, except Adjusted EBITDA margin data)
Year Ended
December 31,
2022
GAAP net income
$
61,494
Stock-based compensation
76,956
Depreciation and amortization
10,682
Interest expense
28,498
Other (income) expense, net
(5,354
)
Income tax expense (benefit)
12,590
Adjusted EBITDA
$
184,866
Adjusted EBITDA margin
20
%
About ZipRecruiter
ZipRecruiter® (www.ziprecruiter.com) is a leading online employment marketplace that actively connects people to their next great opportunity. ZipRecruiter’s powerful matching technology improves the job search experience for job seekers and helps businesses of all sizes find and hire the right candidates quickly. ZipRecruiter has been the #1 rated job search app on iOS & Android for the past six years1 and is rated the #1 employment job site by G2.2
1Based on job seeker app ratings, during the period of January 2017 to January 2023 from AppFollow for ZipRecruiter, CareerBuilder, Glassdoor, Indeed, LinkedIn, and Monster.
2Based on G2 satisfaction ratings as of December 13, 2022.
