What Happened?
Shares of local business platform Yelp (NYSE: YELP) jumped 10% in the afternoon session after the company reported strong first quarter 2025 results that blew past analysts' EBITDA and sales estimates. What's more impressive is that Yelp kept costs in check, letting more of those dollars fall to the bottom line as profits rose faster than sales. Overall, this print had some key positives.
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What The Market Is Telling Us
Yelp’s shares are not very volatile and have only had 5 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 12 months ago when the stock dropped 7.6% on the news that the company reported first quarter 2024 results. Yelp's revenue growth regrettably slowed and its revenue missed Wall Street's estimates. The company observed "a challenging environment for the restaurant, retail and other categories" partly offset by outperformance in the home services segment ( +15% year-over-year).
On the other hand, adjusted EBITDA came in ahead. Overall, this was a mixed quarter for Yelp.
Yelp is up 0.2% since the beginning of the year, and at $39.13 per share, it is trading close to its 52-week high of $41.25 from January 2025. Investors who bought $1,000 worth of Yelp’s shares 5 years ago would now be looking at an investment worth $1,767.
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