Nextdoor Holdings, Inc. Q4 FY2025 earnings call

• Nextdoor is a trust-based local network built on a verified address-based neighborhood graph. Over the past two years, it reworked the product experience to elevate decision-oriented content. Q4 reflected progress in product and operating performance, with revenue growth and positive adjusted EBITDA. - Focused on engagement quality and intent, net promoter score improved in 2025 and engagement frequency increased. - Invested in proprietary ad stack, seeing gains in self-serve, with AI-driven tools reducing friction in campaign creation and improving reporting transparency. - Prioritize long-term network health, capital efficiency, and durable unit economics.

Q4 revenue was $69,000,000, up 7% year over year, the highest ever quarterly revenue. Q4 self-serve revenue grew 32% year over year and comprised roughly 60% of total revenue. Q4 adjusted EBITDA was $8,000,000, an 11% margin. Full year 2025 saw positive adjusted EBITDA, moving from an adjusted EBITDA loss of over $70,000,000 two years ago. Platform WAU was 21,000,000, a 3% sequential decline. Revenue per employee increased 26% year over year in Q4.

Q1 revenue expected to be $57,000,000 to $59,000, up 7% year over year at midpoint, adjusted EBITDA negative $6,000,000 to negative $4,000,000. Full year 2026 expected to see continued revenue growth and adjusted EBITDA margins in the mid-single digit range. Intentionally limiting new user acquisition efforts and not planning to increase ad load in Q1 2026.

Q: Encouraging to hear frequency and engagement quality are improving. Can you add more color on specific product changes resonating with users and delta in usage trends from existing versus newer user cohorts?

A: Nirav said they're converting product to be utility centric and intent-driven, with various changes like focus on recommendations, local news, relevant notifications, using AI to personalize feed.

Q: Revisit budget trends by vertical or advertiser size and update on spending patterns from larger advertisers?

A: Nirav and Indrajit said strong revenue quarter with broad based advertiser demand and better performance across board.

Q: Updates on building out programmatic ad stack?

A: Need to continue investing in programmatic formats as large advertisers seek them, with programmatic being a supplement to direct sales and seeing strong demand.

Q: Evolution of recommendations in 2026?

A: Major priority to make it easier to find best small businesses in neighborhood, focusing on various aspects like better answering of questions, using AI for summaries, bringing SMBs on platform.

Q: More work on moderating notifications and emails and current frequency long term?

A: Will never stop making notifications more relevant, conservative view on number sent until they're relevant, will be long-term minded.

Q: Phase launch of faves and impact on content quality?

A: Thinking of it as ongoing iterative improvements, not big rollout with big releases, but gradual improvement. Then in investor Q&A: Q: Progress of implementing AI features into app and main bottlenecks?

A: AI is transformative, implemented in making company more efficient, consumer product better, advertiser optimization, seen as foundation of everything.

Q: How is Nextdoor truly different from other social media or home services apps?

A: Core asset is neighborhood graph with verified identity and location, and it's many-to-many communication community centric vs one-to-many of others.

Q: Lean more heavily into vertical specific use cases like home services and pet services?

A: Need to push deeper and build more vertically specific solutions for highest intent and monetization use cases.

Q: Philosophy on use of cash?

A: Ended 2025 with over $400,000,000 cash and no debt, preserve liquidity for operating and strategic flexibility, use cash where return on investment thresholds are exceeded.