YELP INC

1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION

Yelp Inc. was incorporated in Delaware on September 3, 2004. Except where specifically noted or the context otherwise requires, the use of terms such as the “Company” and “Yelp” in these Notes to Condensed Consolidated Financial Statements refers to Yelp Inc. and its subsidiaries.

Yelp is a trusted local resource for consumers and a partner in success for businesses of all sizes. Consumers trust Yelp for its extensive ratings and reviews of businesses across a broad range of categories, while businesses advertise on Yelp to reach its large audience of consumers. Yelp has operations in the United States, United Kingdom, Canada, Ireland and Germany.

Basis of Presentation

The accompanying interim condensed consolidated financial statements are unaudited. These unaudited interim condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Certain information and note disclosures normally included in the financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. Accordingly, these unaudited interim condensed consolidated financial statements should be read in conjunction with the consolidated financial statements contained in the Annual Report on Form 10-K for the year ended December 31, 2025 (the “Annual Report”).

The unaudited condensed consolidated balance sheet as of December 31, 2025 included herein was derived from the audited consolidated financial statements as of that date, but does not include all disclosures required by GAAP, including certain notes to the financial statements. The unaudited interim condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements.

In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments of a normally recurring nature necessary for the fair presentation of the interim periods presented.

Principles of Consolidation

These unaudited interim condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated upon consolidation.

Use of Estimates

The preparation of the Company’s unaudited interim condensed consolidated financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of income and expenses during the reporting period. Items that require estimates, judgments or assumptions include, but are not limited to, determining variable consideration and identifying the nature and timing of satisfaction of performance obligations, allowance for credit losses, valuation of intangible assets acquired in a business combination, fair value and estimated useful lives of long- and indefinite-lived assets, litigation loss contingencies, liabilities related to incurred but not reported insurance claims, fair value and achievement of targets for performance-based restricted stock units (“PRSUs”), and income taxes. These estimates, judgments and assumptions are based on information available as of the date of the condensed consolidated financial statements; therefore, actual results could differ from management’s estimates due to macroeconomic uncertainty and other factors.

Significant Accounting Policies

There have been no material changes to the Company’s significant accounting policies from those described in the Annual Report.

Recently Adopted Accounting Pronouncements

In July 2025, the FASB issued ASU No. 2025-05, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets” (“ASU 2025-05”), which provides a practical expedient for estimating expected credit losses for current accounts receivable and current contract assets. The Company adopted ASU 2025-05 effective January 1, 2026 on a prospective basis. The adoption of ASU 2025-05 did not have a material effect on the Company’s condensed consolidated financial statements and related disclosures.

Recent Accounting Pronouncements Not Yet Effective

There have been no new accounting pronouncements issued that are expected to have a material impact on our condensed consolidated financial statements from those described in the Annual Report.

2. CASH, CASH EQUIVALENTS AND RESTRICTED CASH

Cash, cash equivalents and restricted cash as of March 31, 2026 and December 31, 2025 consisted of the following (in thousands):

Restricted cash is included in other non-current assets on the Company’s condensed consolidated balance sheets.

3. MARKETABLE SECURITIES

Short-term marketable securities and certain cash equivalents consist of investments in debt securities that are classified as available-for-sale. In the first quarter of 2026, the Company sold all of its marketable securities. The associated realized gain wasnot significant. The amortized cost, gross unrealized gains and losses and fair value of those investments as of December 31, 2025 were as follows (in thousands):

The following table presents gross unrealized losses and fair values for those securities that were in an unrealized loss position as of December 31, 2025, aggregated by investment category and the length of time that the individual securities had been in a continuous loss position (in thousands):

For the three months ended March 31, 2026 and 2025, the Company didnot recognize any credit loss related to available-for-sale marketable securities.

4. FAIR VALUE MEASUREMENTS

The Company’s investments in money market accounts are recorded as cash equivalents at fair value on the condensed consolidated balance sheets. Additionally, the Company carries its available-for-sale debt securities at fair value. See Note 3, “Marketable Securities,” for further details. The Company’s borrowings under its credit facility approximate fair value due to the variable-rate nature of the debt. See Note 11, “Commitments and Contingencies,” for further details.

The following table represents the fair value of the Company’s cash equivalents, short-term marketable securities, and other investments measured at fair value on a recurring basis, as of December 31, 2025 (in thousands):

(1)Reflected in prepaid expenses and other current assets on the condensed consolidated balance sheets.

There wereno cash equivalents, short-term marketable securities, and other investments as of March 31, 2026.

5. PROPERTY, EQUIPMENT AND SOFTWARE, NET

Property, equipment and software, net as of March 31, 2026 and December 31, 2025 consisted of the following (in thousands):

Depreciation and amortization expense related to property, equipment and software was $11.0 million and $9.9 million for the three months ended March 31, 2026 and 2025, respectively.

6. ACQUISITIONS

Acquisition of Hatchify Inc. (“Hatch”)

On February 2, 2026, the Company acquired Hatch, an artificial intelligence (“AI”) lead management platform, to further complement the Company’s AI capabilities and strategy.

In connection with the acquisition, all outstanding capital stock and options to purchase capital stock of Hatch were converted into the right to receive an aggregate of approximately $271.2 million in cash, subject to customary post-closing adjustments. Of the total amount of consideration, $1.0 million is being held-back for a 120-day period after closing; $0.7 million is being held-back for a 12-month period after closing; and $2.8 million is being held-back for a 36-month period after closing. The Company recorded $1.7 million and $2.8 million of holdbacks in accounts payable and other accrued expenses and other long-term liabilities, respectively, in the condensed consolidated balance sheets as of March 31, 2026. Pursuant to the Merger Agreement, the Company will also provide certain continuing Hatch employees with acquisition- and integration-related payments valued at an aggregate of $30.0 million to be paid out overtwo tothree years. Because these payments are contingent on future service, provide benefits to the Company after the closing date, and are not attributable to pre-acquisition ownership interests, they are accounted for as post-combination expenses rather than as part of the purchase consideration.

The acquisition was accounted for as a business combination in accordance with Accounting Standards Codification Topic 805, “Business Combinations,” with the results of Hatch’s operations included in the Company’s condensed consolidated financial statements from February 2, 2026. The Company’s allocation of the purchase price is preliminary as the fair value of net assets acquired and the effects of any net working capital adjustments are still being finalized. Any material measurement period adjustments will be recorded in the period in which the adjustment is identified.

The preliminary purchase price allocation, subject to finalization during the measurement period, is as follows (in thousands):

(1)Represents non-current deferred tax liabilities (“DTLs”). Deferred tax assets (“DTAs”) are netted against DTLs within the same jurisdiction.

The amounts assigned to each class of intangible assets acquired and their estimated useful lives are as follows:

The Company estimated the fair value of intangible assets acquired using an income approach. Significant assumptions used include forecasted revenue and expenses, customer attrition rate, technology obsolescence, royalty rates and discount rates. The fair value measurements were primarily based on significant inputs that are not observable in the market and thus represent a Level 3 measurement within the fair value hierarchy. The intangible assets are amortized on a straight-line basis, which reflects the pattern in which the economic benefits of the intangible assets are being utilized. The goodwill results from expected synergies between the Company and Hatch. None of the goodwill is deductible for tax purposes.

For the three months ended March 31, 2026, the Company recorded acquisition and integration costs of approximately $4.4 million, which were included in general and administrative expenses in the accompanying condensed consolidated statements of operations.

The Company has not presented supplemental pro forma information for revenue and earnings related to its acquisition of Hatch, as the acquisition is not material to the Company’s condensed consolidated financial statements during the periods presented. The results of operations of Hatch have been included in our condensed consolidated statement of operations from the acquisition date. Revenue attributable to Hatch is not material to our consolidated results and, accordingly, is not presented separately. Due to the integration of the combined businesses since the date of acquisition, it is impracticable to determine the earnings attributable by Hatch.

Acquisition of RepairPal, Inc. (“RepairPal”)

On November 26, 2024, the Company acquired auto services platform RepairPal. The key purpose underlying the Company’s acquisition of RepairPal was to accelerate its efforts in Services categories by expanding its offerings in the auto services advertising vertical. RepairPal’s results of operations are included in the Company’s consolidated financial statements from November 26, 2024.

In connection with the acquisition, all outstanding capital stock, options and warrants to purchase capital stock of RepairPal were converted into the right to receive total purchase consideration of $80.0 million in cash, including approximately $12.3 million in aggregate holdback liability. Of the total amount of consideration, the following amounts were initially held back to secure the Company’s right of indemnity under the Agreement and Plan of Merger: (1) $8.0 million, for a 15-month period after closing (the “general holdback”), $1.2 million of which was released to the Company as a post-closing purchase price adjustment; (2) $2.0 million, for a 24-month period after closing (the “tax holdback”); and (3) $3.5 million, until 30 days following the final, non-appealable resolution of certain legal matters (the “indemnity holdback”). During the year ended December 31, 2025, the Company incurred approximately $5.0 million in legal expenses (originally recorded in general and administrative expenses), $3.5 million of which were applied against the indemnity holdback and the remainder of which were applied against the general holdback. As a result, as of March 31, 2026 and December 31, 2025, $5.3 million of the general holdback and $2.0 million of the tax holdback remained, both of which were classified as accounts payable and accrued liabilities on the consolidated balance sheets. Under the terms of the Agreement and Plan of Merger, the remaining general holdback was to be released 15 months after closing; however, the Company will retain such amount through June 30, 2026 pending the resolution of certain claims by the Company against it.

The allocation of the purchase consideration to tangible and intangible assets acquired and liabilities assumed was completed as of November 25, 2025, based on estimated fair values as follows (in thousands):

The amounts assigned to each class of intangible assets acquired and their estimated useful lives are as follows (in thousands, except years):

The Company estimated the fair value of intangible assets acquired using an income approach. Significant assumptions used include forecasted revenue and expenses, customer attrition rate, royalty rates and discount rates. The fair value measurements were primarily based on significant inputs that are not observable in the market and thus represent a Level 3 measurement within the fair value hierarchy. The intangible assets are amortized on a straight-line basis, which reflects the pattern in which the economic benefits of the intangible assets are being utilized. The goodwill results from expected synergies between the Company and RepairPal. None of the goodwill is deductible for tax purposes.

RepairPal’s results of operations are included in the Company’s condensed consolidated financial statements from November 26, 2024 and the purchase price allocation was finalized on November 25, 2025. Acquisition and integration costs, which were included in general and administrative expenses in the accompanying condensed consolidated statements of operations, were not significant for the periods presented. Measurement period adjustments were not significant and were included in the period in which they occurred.

The Company has not presented the supplemental pro forma information for revenue and earnings related to the acquisition, as the acquisition is not material to the Company’s consolidated financial statements during the periods presented.

7. GOODWILL AND INTANGIBLE ASSETS

The Company’s goodwill is the result of its acquisitions of other businesses and represents the excess of purchase consideration over the fair value of assets acquired and liabilities assumed. The Company performed its annual goodwill impairment analysis on August 31, 2025 and concluded that goodwill wasnot impaired, as the fair value of the reporting unit exceeded its carrying value. Additionally, no triggering events were identified as of March 31, 2026 or December 31, 2025 that would more likely than not reduce the fair value of goodwill below its carrying value.

The change in the carrying amount of goodwill during the three months ended March 31, 2026 was as follows (in thousands):

Intangible assets that were not fully amortized as of March 31, 2026 and December 31, 2025 consisted of the following (dollars in thousands):

Amortization expense related to intangible assets was $5.3 million and $2.5 million for the three months ended March 31, 2026 and 2025, respectively.

As of March 31, 2026, estimated future amortization expense was as follows (in thousands):

8. LEASES

The components of lease cost, net for the three months ended March 31, 2026 and 2025 were as follows (in thousands):

The Company’s leases and subleases do not include any variable lease payments, residual value guarantees, related-party leases, or restrictions or covenants that would limit or prevent the Company from exercising its right to obtain substantially all of the economic benefits from use of the respective assets during the lease term.

Supplemental cash flow information related to leases for the three months ended March 31, 2026 and 2025 was as follows (in thousands):

As of March 31, 2026, maturities of lease liabilities were as follows (in thousands)(1):

(1)Non-cancelable sublease proceeds of $13.4 million are not included in the maturities of lease liabilities disclosed in the table.

As of March 31, 2026 and December 31, 2025, the weighted-average remaining lease term and weighted-average discount rate were as follows:

9. CONTRACT BALANCES

The changes in the allowance for credit losses during the three months ended March 31, 2026 and 2025 were as follows (in thousands):

In calculating the allowance for credit losses as of March 31, 2026 and 2025, the Company considered expectations of probable credit losses based on observed trends in cancellations, observed changes in the credit risk of specific customers, the impact of anticipated closures and bankruptcies using forecasted economic indicators in addition to historical experience and loss patterns during periods of macroeconomic uncertainty. The decrease in the provision for credit losses and write-offs, net of recoveries in the three months ended March 31, 2026 as compared to the prior-year period was primarily due to lower customer delinquencies.

Contract liabilities consist of deferred revenue, which is recorded on the condensed consolidated balance sheets when the Company has received consideration, or has the right to receive consideration, in advance of transferring the performance obligations under the contract to the customer.

The changes in short-term deferred revenue during the three months ended March 31, 2026 were as follows (in thousands):

The majority of the Company’s deferred revenue balance as of March 31, 2026 is classified as short-term and is expected to be recognized as revenue in the subsequent three-month period ending June 30, 2026. An immaterial amount of long-term deferred revenue is included in other long-term liabilities as of March 31, 2026. No other contract assets or liabilities were recorded on the Company’s condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025.

Revenue allocated to remaining performance obligations represents estimated contracted revenue that has not yet been recognized. This includes deferred revenue and unbilled amounts that will be recognized as revenue in future periods, and excludes contracts with original expected terms of one year or less. Estimated contracted revenue for these remaining performance obligations was $83.8 million as of March 31, 2026, of which the Company expects to recognize approximately 47% over the next 12 months and the remainder thereafter. Estimating revenue that will be allocated to remaining performance obligations can involve significant judgments, including identifying and assessing variable consideration.

10. SELECTED CONSOLIDATED FINANCIAL STATEMENT DATA

Prepaid expenses and other current assets

Prepaid expenses and other current assets as of March 31, 2026 and December 31, 2025 consisted of the following (in thousands):

Other non-current assets

Other non-current assets as of March 31, 2026 and December 31, 2025 consisted of the following (in thousands):

(1)Represents net non-current DTAs. DTAs are netted against DTLs within the same jurisdiction.

Accounts payable and accrued liabilities

Accounts payable and accrued liabilities as of March 31, 2026 and December 31, 2025 consisted of the following (in thousands):

As of March 31, 2026, other accrued liabilities primarily consisted of current holdback consideration related to the acquisitions of RepairPal and Hatch, taxes payable, and accrued product development and general and administrative expenses. See Note 6,“Acquisitions,” for details of current holdback consideration related to the acquisitions of RepairPal and Hatch.

Other income, net

Other income, net for the three months ended March 31, 2026 and 2025 consisted of the following (in thousands):

11. COMMITMENTS AND CONTINGENCIES

Legal Proceedings

The Company is subject to legal proceedings arising in the ordinary course of business. Although the results of litigation and claims cannot be predicted with certainty, the Company currently does not believe that the final outcome of any of these other matters will have a material effect on the Company’s business, financial position, results of operations or cash flows.

Indemnification Agreements

In the ordinary course of business, the Company may provide indemnifications of varying scope and terms to customers, vendors, lessors, business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of the breach of such agreements, services to be provided by the Company or from intellectual property infringement claims made by third parties. The Company may also assume indemnification obligations in strategic transactions, such as its assumption of certain indemnification obligations in its acquisition of RepairPal.

In addition, the Company has entered into indemnification agreements with directors and certain officers and employees that will require the Company to, among other things, indemnify them against certain liabilities that may arise by reason of their status or service as directors, officers or employees.

While the outcome of claims cannot be predicted with certainty, the Company does not believe that the outcome of any claims under the indemnification arrangements will have a material effect on the Company’s business, financial position, results of operations or cash flows.

Revolving Credit Facility

The Company has a revolving credit facility established by its Revolving Credit and Guaranty Agreement, dated as of April 28, 2023, with certain lenders and JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, as amended by the First Amendment to Revolving Credit and Guaranty Agreement, dated as of December 18, 2025, with the lenders party thereto, JPMorgan Bank, N.A., as the existing administrative agent and collateral agent, and Wells Fargo Bank National Association, as the successor administrative agent and collateral agent (as amended, the “Credit Agreement”).

The Credit Agreement provides for a $325.0 million senior secured revolving credit facility (the “credit facility”), which includes a $35.0 million letter of credit sub-limit, a $25.0 million bilateral letter of credit facility and an accordion option, which, if exercised, would allow the Company to increase the aggregate commitments by up to $250.0 million, plus additional amounts if the Company is able to satisfy a leverage test, subject to certain conditions. The commitments under the credit facility expire on April 28, 2028.

Loans under the credit facility bear interest, at the Company’s election, at either (a) an adjusted term Secured Overnight Financing Rate plus 0.10% plus a margin of 1.25% -1.50%, depending on the Company’s total leverage ratio, or (b) an alternative base rate plus a margin of 0.25% -0.50%, depending on the Company’s total leverage ratio. The Company is required to pay a commitment fee on the undrawn portion of the aggregate commitments that accrues at 0.20% -0.25% per annum, depending on the Company’s total leverage ratio, as well as a letter of credit fee on any outstanding letters of credit that accrues at 1.25% -1.50% per annum, depending on the Company’s total leverage ratio.

The credit facility contains customary conditions to borrowing, events of default and covenants, including covenants that restrict the Company’s ability to incur indebtedness, grant liens, make distributions, pay dividends, repurchase shares, make investments and engage in transactions with the Company’s affiliates, in each case subject to certain exceptions. The credit facility also requires the Company to maintain a total leverage ratio of no greater than 3.75 to 1.00, subject to an increase up to 4.25 to 1.00 for a certain period following significant acquisitions, and an interest coverage ratio of no less than 3.00 to 1.00. The obligations under the credit facility are secured by liens on substantially all of the Company’s domestic assets, including certain domestic intellectual property assets and the equity of its domestic subsidiaries, as well as a portion of the equity interests the Company holds directly in its foreign subsidiaries.

As of March 31, 2026, the Company had outstanding borrowings of $130.0 million, at a weighted-average interest rate of 5.50%, $4.2 million of letters of credit outstanding under the credit facility sub-limit, and $190.8 million remained available under the credit facility. The letters of credit are primarily related to lease agreements for certain office locations and are required to be maintained and issued to the landlords of each facility. The Company was in compliance with all conditions and financial covenants thereunder as of March 31, 2026.

Deferred financing costs represent costs incurred with the issuance or amendment of our credit facility, and are amortized over the terms of the related debt and recognized as a component of interest expense in the unaudited condensed consolidated statements of operations. Deferred financing costs related to the 2025 amendment of our revolving credit facility were not significant and are included in other assets in the unaudited condensed consolidated balance sheets.

Purchase Obligations

The Company has certain off-balance sheet non-cancelable purchase obligations, consisting primarily of website hosting costs and other commitments required in the ordinary course of business. As of March 31, 2026, total commitments were approximately $132.9 million, of which approximately $79.5 million is expected to be paid within the next 12 months.

12. STOCKHOLDERS’ EQUITY

Stock Repurchase Program

On February 10, 2026, the Company’s board of directors authorized a $500.0 million increase to its stock repurchase program, bringing the total amount of repurchases authorized under the stock repurchase program since its inception in 2017 to $2.45 billion of its outstanding common stock, $413.8 million of which remained available as of March 31, 2026. The Company may purchase shares at management’s discretion in the open market, in privately negotiated transactions, in transactions structured through investment banking institutions or a combination of the foregoing.

During the three months ended March 31, 2026, the Company repurchased 5,086,834 shares on the open market for an aggregate purchase price of $125.0 million (excluding the 1% excise tax on stock repurchases as a result of the Inflation Reduction Act of 2022) and retired 4,865,355 shares. As of March 31, 2026, the Company had a treasury stock balance of 254,479 shares, which were excluded from its outstanding share count as of such date and subsequently retired in April 2026.

During the three months ended March 31, 2025, the Company repurchased 1,688,858 shares on the open market for an aggregate purchase price of $62.5 million (excluding the 1% excise tax on stock repurchases as a result of the Inflation Reduction Act of 2022) and retired 1,747,343 shares. As of March 31, 2025, the Company had a treasury stock balance of 42,375 shares, which were excluded from its outstanding share count as of such date and subsequently retired in April 2025.

Equity Incentive Plans

Stock Options

A summary of stock option activity for the three months ended March 31, 2026 is as follows:

Aggregate intrinsic value represents the difference between the closing price of the Company’s common stock as quoted on the New York Stock Exchange on a given date and the exercise price of outstanding, in-the-money options. The total intrinsic value of options exercised was approximately $3.1 million and $0.2 million for the three months ended March 31, 2026 and 2025, respectively.

RSUs

RSUs include PRSUs that are subject to either (a) a market condition or (b) the achievement of performance goals. As the PRSU activity during the three months ended March 31, 2026 was not material, it is presented together with the RSU activity in the table below. A summary of RSU and PRSU activity for the three months ended March 31, 2026 is as follows (in thousands, except per share amounts):

(1)Includes approximately 0.5 million shares that vested but were not issued due to the Company’s use of net share settlement for payment of employee taxes.

(2)Includes approximately 1.0 million PRSUs.

The aggregate fair value as of the vest date of RSUs and PRSUs that vested during the three months ended March 31, 2026 and 2025 was $23.2 million and $44.6 million, respectively. As of March 31, 2026, the Company had approximately $229.2 million of unrecognized stock-based compensation expense related to RSUs and PRSUs, which it expects to recognize over the remaining weighted-average vesting period of approximately 2.6 years.

Employee Stock Purchase Plan

There wereno shares purchased by employees under the Employee Stock Purchase Plan (“ESPP”) during the three months ended March 31, 2026 and 2025. The Company recognized stock-based compensation expense related to the ESPP of $1.2 million and $1.1 million during the three months ended March 31, 2026 and 2025, respectively.

Stock-Based Compensation

The following table summarizes the effects of stock-based compensation expense related to stock-based awards in the condensed consolidated statements of operations during the periods presented (in thousands):

The Company capitalized $2.3 million and $2.8 million of stock-based compensation expense as website and internal-use software development costs and, to a lesser extent, implementation costs incurred related to cloud computing arrangements that are service contracts in the three months ended March 31, 2026 and 2025, respectively.

13. INCOME TAXES

The Company is subject to income taxes in the United States as well as other tax jurisdictions in which it conducts business. Earnings from non-U.S. activities are subject to local country income taxes. The provision for income taxes for the three months ended March 31, 2026 was $12.1 million, which was due to $6.9 million of U.S. federal, state and foreign income tax expense and $5.2 million of net discrete tax expense primarily related to interest on uncertain tax positions and stock-based compensation. The provision for income taxes for the three months ended March 31, 2025 was $10.8 million, which was due to $8.7 million of U.S. federal, state and foreign income tax expense and$2.1 million of netdiscrete tax expense primarily related to interest on uncertain tax positions.

Accounting for income taxes for interim periods generally requires the provision for income taxes to be determined byapplying an estimate of the annual effective tax rate for the full fiscal year to income or loss before income taxes, excluding unusual or infrequently occurring discrete items, for the reporting period. For the three months ended March 31, 2026 and 2025, the difference between the effective tax rate and the federal statutory tax rate was primarily related to tax credits, offset by stock-based compensation and other non-deductible expenses.

As of March 31, 2026, the Company had$52.0 million of unrecognized tax benefits that, if recognized, would affect the Company’s effective tax rate.

As of March 31, 2026, the Company estimated that it had accumulated undistributed earnings generated by its foreign subsidiaries of approximately$52.8 million. Any taxes due with respect to such earnings or the excess of the amount for financial reporting over the tax basis of the Company’s foreign investments would generally be limited to foreign and state taxes. The Company has not recognized a deferredtax liability related to unremitted foreign earnings, as it intends to indefinitely reinvest these earnings, and expects future U.S. cash generation to be sufficient to meet future U.S. cash needs.

In addition, the Company is subject to the continuous examination of its income tax returns by the Internal Revenue Service and other tax authorities. The Company’s federal and state income tax returns for tax years subsequent to 2012 remain open to examination. In the Company’s foreign jurisdictions — Canada, Germany, Ireland and the United Kingdom — the tax years subsequent to 2019 remain open to examination. The Company regularly assesses the likelihood of adverse outcomes resulting from examinations to determine the adequacy of its provision for income taxes and monitors the progress of ongoing discussions with tax authorities and the impact, if any, of the expected expiration of the statute of limitations in various taxing jurisdictions. The Company believes that an adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax audits cannot be predicted with certainty. If any issues addressed in the Company’s tax audits are resolved in a manner not consistent with management’s expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs.

14. NET INCOME PER SHARE ATTRIBUTABLE TO COMMON STOCKHOLDERS

Basic net income (loss) per share attributable to common stockholders is computed using the weighted-average number of outstanding shares of common stock during the period. Diluted net income (loss) per share attributable to common stockholders is computed using the weighted-average number of outstanding shares of common stock and the effect of potentially dilutive securities outstanding during the period. Potentially dilutive securities include stock options, RSUs (including PRSUs) and, to a lesser extent, ESPP shares. If dilutive, such potentially dilutive securities are reflected in net income (loss) per share attributable to common stockholders using the treasury stock method.

The following tables present the calculation of basic and diluted net income per share attributable to common stockholders for the periods presented (in thousands, except per share data):

The following stock-based instruments were excluded from the calculation of diluted net income per share attributable to common stockholders because their effect would have been anti-dilutive for the periods presented (in thousands):

15. INFORMATION ABOUT SEGMENT, REVENUE AND GEOGRAPHIC AREAS

The Company considers operating segments to be components of the Company for which separate financial information is available and evaluated regularly by the Company’s chief operating decision maker in deciding how to allocate resources and in assessing performance. The Company has determined that it has a single operating and reporting segment managed on a consolidated basis. The single segment generates substantially all of its revenue from the sale of performance-based advertising products through its advertising platform. The chief operating decision maker for the Company is the Chief Executive Officer. The Chief Executive Officer assesses performance for the single segment and decides how to allocate resources based on net income, which is reported on the condensed consolidated statements of operations as net income attributable to common stockholders. Net income is used to monitor budget versus actual results. The measure of segment assets is reported on the condensed consolidated balance sheets as total assets.

The following table presents a reconciliation of segment net income to net income attributable to common stockholders for the periods presented (in thousands):

(1)Includes expenses related to employees working in the sales and marketing, product development, and general and administrative departments and excludes expenses related to employees working in the infrastructure department whose costs are included in the cost of revenue (exclusive of depreciation and amortization and stock-based compensation) line.

(2)Includes marketing, facilities, travel and entertainment, consulting and professional services, hardware and software, bad debt, other operating expenses and other income, net.

(3)Prior period segment information has been recast to conform to the way the Company currently internally manages and monitors its business. The recast of prior period information had no impact on the Company’s condensed consolidated balance sheets, condensed consolidated statements of operations, or condensed consolidated statements of cash flows.

Net Revenue

When the Company communicates results externally, it disaggregates net revenue into major product lines and primary geographical markets, which is based on the billing address of the customer. The disaggregation of net revenue by major product lines is based on the type of service provided and also aligns with the timing of revenue recognition for each. To reflect the Company’s strategic focus on creating differentiated experiences for its Services categories and Restaurants, Retail & Other categories, the Company further disaggregates advertising revenue to reflect these two high-level category groupings. The Services categories consist of the following businesses: home, local, auto, professional, pets, events, real estate and financial services. The Restaurants, Retail & Other categories consist of the following businesses: restaurants, shopping, beauty & fitness, health and other.

The following table presents the Company’s net revenue by major product line (and by category for advertising revenue) for the periods presented (in thousands):

During the three months ended March 31, 2026 and 2025, no individual customer accounted for 10% or more of consolidated net revenue.

The following table presents the Company’s net revenue by major geographic region for the periods presented (in thousands):