ZIPRECRUITER, INC.

Previous wording

For the three months ended September 30, 2024, our revenue was $117.1 million and we had a net loss of $2.6 million and Adjusted EBITDA of $15.0 million. For the three months ended September 30, 2023, our revenue was $155.6 million, and we generated net income of $24.1 million and Adjusted EBITDA of $54.4 million. For the nine months ended September 30, 2024, our revenue was $363.0 million and we had a net loss of $2.1 million and Adjusted EBITDA of $63.6 million. For the nine months ended September 30, 2023, our revenue was $509.8 million, and we generated net income of $43.5 million and Adjusted EBITDA of $132.9 million. Adjusted EBITDA is a financial measure not presented in accordance with GAAP. For a definition of Adjusted EBITDA, an explanation of our management’s use of this measure and a reconciliation of net income (loss) to Adjusted EBITDA, see the section titled “Key Operating Metrics and Non-GAAP Financial Measures.”

Current wording

For the three months ended March 31, 2025, our revenue was $110.1 million and we had a net loss of $12.8 million and Adjusted EBITDA of $5.9 million. For the three months ended March 31, 2024, our revenue was $122.2 million, and we had a net loss of $6.5 million and Adjusted EBITDA of $20.8 million. Adjusted EBITDA is a financial measure not presented in accordance with GAAP. For a definition of Adjusted EBITDA, an explanation of our management’s use of this measure and a reconciliation of net income (loss) to Adjusted EBITDA, see the section titled “Key Operating Metrics and Non-GAAP Financial Measures.”

Previous wording

In the quarter ended September 30, 2024, Revenue per Paid Employer increased slightly when compared to the quarter ended June 30, 2024. While we saw Quarterly Paid Employers decrease during the quarter ended September 30, 2024, reflecting the current softness in hiring demand amidst the challenging economic climate, we believe our products and services continued to improve and offered more value for employers of all sizes.

Current wording

In the quarter ended March 31, 2025, Revenue per Paid Employer decreased when compared to the quarter ended December 31, 2024. While we believe our products and services continued to improve and offered more value for employers of all sizes, we saw a sequential decline in Revenue per Paid Employer as new and returning Paid Employers ramped up hiring over the course of the quarter ended March 31, 2025, following the holiday slowdown.

Previous wording

The following table presents a reconciliation of net income (loss) to Adjusted EBITDA for each of the periods indicated:

Current wording

The following table presents a reconciliation of net loss to Adjusted EBITDA for each of the periods indicated:

Previous wording

The following tables present net income (loss) margin and Adjusted EBITDA margin for each of the periods indicated:

Current wording

The following tables present net loss margin and Adjusted EBITDA margin for each of the periods indicated:

Previous wording

We had a lower number of Quarterly Paid Employers in our marketplace in the quarter ended September 30, 2024 compared to the prior-year period. In the quarter ended September 30, 2024, we delivered $117.1 million in revenue, which is a 25% decrease compared to the quarter ended September 30, 2023. Despite Revenue per Paid Employer being higher in the quarter ended September 30, 2024 compared to the quarter ended September 30, 2023 as our products and services continued to improve and offered more value for employers, we saw employers significantly reduce spend on products and services in our marketplace during the quarter ended September 30, 2024 compared to the quarter ended September 30, 2023 amidst the continuing challenging macroeconomic conditions.

Current wording

We had a lower number of Quarterly Paid Employers in our marketplace in the quarter ended March 31, 2025 compared to the prior-year period. In the quarter ended March 31, 2025, we delivered $110.1 million in revenue, which is a 10% decrease compared to the quarter ended March 31, 2024. Despite Revenue per Paid Employer being higher in the quarter ended March 31, 2025 compared to the quarter ended March 31, 2024 as our products and services continued to improve and offered more value for employers, we saw employers continue to moderate hiring plans given the uncertainty in the economy. With those currently employed continuing to leave their jobs at a low rate during the quarter ended March 31, 2025, hiring levels remained lower compared to the quarter ended March 31, 2024.

Previous wording

We expect that sales and marketing expenses will increase or decrease on an absolute dollar basis as we adjust our highly variable sales and marketing spend budget throughout economic cycles to reallocate or conserve spend to where we see the greatest returns. Additionally, sales and marketing expenses may vary from period to period as a percentage of revenue for the foreseeable future as we constantly measure the expected returns of specific sales and marketing initiatives and adjust spend levels up or down accordingly. This discipline has been a key aspect of our strong financial performance through a wide range of macroeconomic conditions. We expect that these expenses will continue to be our largest operating expense category for the foreseeable future as we continue to expand on our sales and marketing efforts over time.

Current wording

We expect that sales and marketing expenses will decrease or increase on an absolute dollar basis as we adjust our highly variable sales and marketing spend budget throughout economic cycles to conserve or reallocate spend to where we see the greatest returns. Additionally, sales and marketing expenses may vary from period to period as a percentage of revenue for the foreseeable future as we constantly measure the expected returns of specific sales and marketing initiatives and adjust spend levels up or down accordingly. This discipline has been a key aspect of our strong financial performance through a wide range of macroeconomic conditions. We expect that these expenses will continue to be our largest operating expense category for the foreseeable future as we continue to expand on our sales and marketing efforts over time.

Previous wording

We believe continued investments in research and development are important to attain our strategic objectives, and expect research and development expense to increase in absolute dollars. This expense may vary as a percentage of total revenue for the foreseeable future as we continue to invest in research and development activities related to ongoing improvements to, and maintenance of, our marketplace, expansion of our services, as well as other research and development programs, including the hiring of engineering, product development, and design employees to support these efforts.

Current wording

We believe continued investments in research and development are important to attain our strategic objectives. This expense may vary as a percentage of total revenue for the foreseeable future as we continue to invest in research and development activities related to ongoing improvements to, and maintenance of, our marketplace, expansion of our services, as well as other research and development programs, including the hiring of engineering, product development, and design employees to support these efforts.

Previous wording

We are subject to federal and state income taxes in the United States, as well as several international jurisdictions. The effective tax rate for the three and nine months ended September 30, 2024 differed from the U.S. federal statutory rate of 21% primarily due to tax detriments relating to the settlement of restricted stock units, or RSUs, limitations on the amount of deductible officer compensation, state taxes, and net tax benefits from research and development tax credits. The effective tax rate for the three and nine months ended September 30, 2023 differed from the U.S. federal statutory tax rate of 21% primarily due to state taxes, tax detriments relating to the settlement of RSUs, and limitations on the amount of deductible officer compensation, partially offset by net tax benefits from research and development tax credits.

Current wording

We are subject to federal and state income taxes in the United States, as well as several international jurisdictions. The effective tax rate for the three months ended March 31, 2025 differed from the U.S. federal statutory rate of 21% primarily due to tax detriments relating to the settlement of restricted stock units, or RSUs, certain non-deductible expenses including limitations on the amount of deductible officer compensation, state taxes, and net tax benefits from research and development tax credits. The effective tax rate for the three months ended March 31, 2024 differed from the U.S. federal statutory tax rate of 21% primarily due to state taxes, tax detriments relating to the settlement of RSUs, certain non-deductible expenses including limitations on the amount of deductible officer compensation, and net tax benefits from research and development tax credits.

Previous wording

Comparison of the Three and Nine Months Ended September 30, 2024 and 2023

Current wording

Comparison of the Three Months Ended March 31, 2025 and 2024

Previous wording

Revenue decreased by $38.5 million, or 25%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023, reflecting the lower number of Quarterly Paid Employers in our marketplace primarily due to the labor market continuing to be impacted by high interest rates in the current period, which posed challenges to many businesses. Subscription revenue decreased by $31.3 million, or 26%, and performance-based revenue decreased by $7.2 million, or 22%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. Despite Revenue per Paid Employer being higher in the current period as our products and services continued to improve and offered more value for employers, we saw employers significantly reduce spend on products and services in our marketplace during the three months ended September 30, 2024 compared to the three months ended September 30, 2023 amidst the continuing challenging macroeconomic conditions.

Current wording

Revenue decreased by $12.2 million, or 10%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, reflecting the lower number of Quarterly Paid Employers in our marketplace primarily due to the labor market continuing to be impacted by high interest rates in the current period as well as overall economic uncertainty, which posed challenges to many businesses. Subscription revenue decreased by $11.2 million, or 12%, and performance-based revenue decreased by $1.0 million, or 4%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. Despite Revenue per Paid Employer being higher in the current period as our products and services continued to improve and offered more value for employers, we saw employers continue to moderate hiring plans given the uncertainty in the economy. With those currently employed continuing to leave their jobs at a low rate during the quarter ended March 31, 2025, hiring levels remained lower compared to the quarter ended March 31, 2024.

Previous wording

Cost of revenue decreased by $2.2 million, or 15%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023, primarily due to a decrease of $0.9 million in credit card processing fees, a decrease of $0.6 million in partner revenue share, and a decrease of $0.5 million in job distribution costs from performance-based revenue. Gross margin was 89% and 91% in the three months ended September 30, 2024 and September 30, 2023, respectively, reflecting our continued commitment to operational efficiencies and maintaining costs proportionate to revenue.

Current wording

Cost of revenue decreased by $1.7 million, or 13%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, primarily due to a decrease of $0.6 million in third-party hosting fees, a decrease of $0.5 million in partner revenue share, and a decrease of $0.3 million in credit card processing fees. Gross margin was 89% in both the three months ended March 31, 2025 and March 31, 2024, reflecting our continued commitment to operational efficiencies and maintaining costs proportionate to revenue.

Previous wording

Research and development expenses decreased by $6.0 million, or 5%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023. The decrease was primarily driven by one-time restructuring costs of $3.3 million related to our May 2023 reduction in force incurred during the nine months ended September 30, 2023, as well as a $1.8 million decrease in personnel-related costs and a $1.0 million decrease in stock-based compensation expense for our research and development employees corresponding with lower headcount in the current-year period. Research and development expenses as a percentage of revenue increased 7% for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, primarily driven by lower revenue. We expect to continue to invest in research and development activities, and we expect this expense may vary as a percentage of total revenue for the foreseeable future.

Current wording

Research and development expenses decreased by $2.8 million, or 8%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The decrease was primarily driven by a $2.0 million decrease in stock-based compensation expense and a $0.9 million decrease in personnel-related costs for our research and development employees corresponding with lower headcount in the current-year period. Research and development expenses as a percentage of revenue remained flat for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. We expect to continue to invest in research and development activities, and we expect this expense may vary as a percentage of total revenue for the foreseeable future.

Previous wording

General and administrative expenses decreased by $12.7 million, or 19%, for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023, primarily driven by a $6.6 million decrease in stock-based compensation expense, a $3.4 million decrease in personnel-related costs for our general and administrative employees corresponding with lower headcount in the current-year period, and a $1.0 million decrease due to one-time restructuring costs related to our May 2023 reduction in force incurred during the nine months ended September 30, 2023.

Current wording

General and administrative expenses decreased by $0.7 million, or 4%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024, primarily driven by a decrease in stock-based compensation expense for our general and administrative employees corresponding with lower headcount in the current-year period.

Previous wording

Income tax expense (benefit) decreased by $7.8 million, or 131%, for the three months ended September 30, 2024 compared to the three months ended September 30, 2023. The decrease in income tax expense (benefit) is primarily attributable to a decrease in income before income taxes partially offset by an increase in income tax expense associated with stock-based compensation.

Current wording

Income tax expense (benefit) decreased by $4.0 million, or 128%, for the three months ended March 31, 2025 compared to the three months ended March 31, 2024. The decrease in income tax expense (benefit) is primarily attributable to a decrease in income before income taxes.

Previous wording

As of September 30, 2024, we had cash, cash equivalents, and marketable securities totaling $497.6 million and $287.6 million available in unused borrowing capacity under our credit facility. We have financed our operations and capital expenditures primarily through cash generated from operations, sales of shares of common and preferred stock and from our senior unsecured notes, bank loans, and convertible notes. As of September 30, 2024, we had no amounts outstanding under our credit facility.

Current wording

As of March 31, 2025, we had cash, cash equivalents, and marketable securities totaling $468.2 million and $286.6 million available in unused borrowing capacity under our credit facility. We have financed our operations and capital expenditures primarily through cash generated from operations, sales of shares of common and preferred stock and from our senior unsecured notes, bank loans, and convertible notes. As of March 31, 2025, we had no amounts outstanding under our credit facility.

Previous wording

In April 2021, we entered into a $250.0 million credit facility agreement with a syndicate of banks. In July 2024, we entered into a supplement to the credit facility agreement which increased the aggregate revolving commitments available under the credit facility from $250.0 million to $290.0 million. The credit facility has a maturity date of April 30, 2026 and bears interest at a rate based upon our Net Leverage Ratio. Our Net Leverage Ratio is defined as total debt less total cash and permitted investments outstanding at period end, with a maximum total cash and permitted investments adjustment of $550.0 million, divided by the trailing 12 months of earnings, adjusted for items such as non-cash expenses and other nonrecurring transactions. We are also obligated to pay other customary fees including a commitment fee on a quarterly basis based on amounts committed but unused under the credit facility at a rate between 0.25% to 0.35%, depending on our Net Leverage Ratio. The amount available under the credit facility is reduced by letters of credit outstanding, which totaled $2.4 million as of September 30, 2024. The letters of credit outstanding relate to various leased office spaces.

Current wording

In April 2021, we entered into a $250.0 million credit facility agreement with a syndicate of banks. In July 2024, we entered into a supplement to the credit facility agreement which increased the aggregate revolving commitments available under the credit facility from $250.0 million to $290.0 million. The credit facility has a maturity date of April 30, 2026 and bears interest at a rate based upon our Net Leverage Ratio. Our Net Leverage Ratio is defined as total debt less total cash and permitted investments outstanding at period end, with a maximum total cash and permitted investments adjustment of $550.0 million, divided by the trailing 12 months of earnings, adjusted for items such as non-cash expenses and other nonrecurring transactions. We are also obligated to pay other customary fees including a commitment fee on a quarterly basis based on amounts committed but unused under the credit facility at a rate between 0.25% to 0.35%, depending on our Net Leverage Ratio. The amount available under the credit facility is reduced by letters of credit outstanding, which totaled $3.4 million as of March 31, 2025. The letters of credit outstanding relate to various leased office spaces.

Previous wording

Our board of directors has authorized us to repurchase up to $550.0 million of our outstanding common stock, with no fixed expiration. During the nine months ended September 30, 2024, we repurchased 3.9 million shares of our Class A common stock for an aggregate purchase price of $37.6 million through open market purchases under our share repurchase program.

Current wording

Our board of directors has authorized us to repurchase up to $650.0 million of our outstanding common stock, with no fixed expiration. During the three months ended March 31, 2025, we repurchased 4.6 million shares of our Class A common stock for $27.4 million under our share repurchase program, including 2.4 million shares of our Class A common stock delivered under a Rule 10b5-1 plan totaling $14.5 million and 2.2 million shares of our Class A common stock purchased in the open market totaling $12.9 million.

Previous wording

Approximately $25.8 million remains available for future repurchases of our Class A common stock under our share repurchase program as of September 30, 2024. For more information, see Note 10 – Share Repurchase Program to our condensed consolidated financial statements included in this report.

Current wording

Approximately $95.7 million remains available for future repurchases of our common stock under our share repurchase program as of March 31, 2025. For more information, see Note 10 – Share Repurchase Program to our condensed consolidated financial statements included in this report.

Previous wording

During the three and nine months ended September 30, 2024, we continued investing primarily in highly rated debt securities and money market mutual funds to manage our excess cash reserves. The primary objectives in investing our excess cash reserves are to preserve capital, provide sufficient liquidity to satisfy both operational cash flow requirements and potential strategic investment opportunities, and to obtain a reasonable or market rate of return on investments. We consider all of our investments as available for use in current operations, including those with maturity dates beyond one year, and therefore classify these securities within current assets in our condensed consolidated balance sheets.

Current wording

During the three months ended March 31, 2025, we continued investing primarily in highly rated debt securities and money market mutual funds to manage our excess cash reserves. The primary objectives in investing our excess cash reserves are to preserve capital, provide sufficient liquidity to satisfy both operational cash flow requirements and potential strategic investment opportunities, and to obtain a reasonable or market rate of return on investments. We consider all of our investments as available for use in current operations, including those with maturity dates beyond one year, and therefore classify these securities within current assets in our condensed consolidated balance sheets.

Previous wording

As of September 30, 2024, we held $325.0 million in total investments, consisting of money market mutual funds and available-for-sale debt securities. These investments are included within cash and cash equivalents and marketable securities within our condensed consolidated balance sheets. For more information, see Note 6 – Financial Instruments to our condensed consolidated financial statements included in this report.

Current wording

As of March 31, 2025, we held $302.5 million in total investments, consisting of money market mutual funds and available-for-sale debt securities. These investments are included within cash and cash equivalents and marketable securities within our condensed consolidated balance sheets. For more information, see Note 6 – Financial Instruments to our condensed consolidated financial statements included in this report.

Previous wording

For the nine months ended September 30, 2024, cash provided by operating activities was $33.2 million resulting from our net loss of $2.1 million, adjusted by non-cash charges of $54.7 million and a net decrease of $19.4 million in our operating assets and liabilities. The non-cash charges primarily resulted from $49.2 million for stock-based compensation expense, $9.1 million pertaining to amortization of intangible assets and depreciation, and $3.0 million pertaining to non-cash lease expense, partially offset by $8.0 million in amortization and accretion of marketable securities and $1.6 million related to the change in our deferred tax assets driven by our current year capitalization of research costs from a tax perspective. The decrease of $19.4 million related to changes in our operating assets and liabilities was primarily driven by an $8.1 million increase in prepaid expenses and other assets, a $6.8 million decrease in accrued interest, a $5.0 million decrease in our accounts payable and accrued expenses and other liabilities, and a $4.0 million decrease in our operating lease liabilities, partially offset by a $3.0 million decrease in accounts receivable and a $1.5 million decrease in deferred commissions, net.

Current wording

For the three months ended March 31, 2025, cash used in operating activities was $9.9 million resulting from our net loss of $12.8 million, adjusted by non-cash charges of $12.8 million and a net decrease of $9.9 million in our operating assets and liabilities. The non-cash charges primarily resulted from $14.6 million for stock-based compensation expense, $3.0 million pertaining to amortization of intangible assets and depreciation, and $1.0 million pertaining to non-cash lease expense, partially offset by $4.6 million related to the change in our deferred tax assets driven by our current year capitalization of research costs from a tax perspective and $2.3 million in amortization and accretion of marketable securities. The decrease of $9.9 million related to changes in our operating assets and liabilities was primarily driven by a $6.9 million decrease in accrued interest associated with our senior unsecured notes, a $1.9 million decrease in our accounts payable and accrued expenses and other liabilities, a $1.7 million increase in accounts receivable, and a $1.4 million decrease in our operating lease liabilities, partially offset by a $0.9 million increase in deferred revenue and a $0.5 million decrease in deferred commissions.

Previous wording

For the nine months ended September 30, 2023, cash provided by operating activities was $68.8 million resulting from our net income of $43.5 million, adjusted by non-cash charges of $48.2 million and a net decrease of $23.0 million in our operating assets and liabilities. The non-cash charges primarily resulted from $58.3 million for stock-based compensation expense, $8.5 million pertaining to amortization of intangible assets and depreciation, and $3.2 million pertaining to non-cash lease expense, partially offset by $16.8 million related to the change in our deferred tax assets driven by our current year capitalization of research costs from a tax perspective and the tax-related impact of stock-based compensation, and $8.6 million in amortization and accretion of marketable securities. The decrease of $23.0 million related to changes in our operating assets and liabilities was primarily driven by an $18.6 million decrease in our accounts payable and accrued expenses and other liabilities, a $6.9 million decrease in our accrued interest associated with our senior unsecured notes, a $4.8 million decrease in our operating lease liabilities, and a $3.4 million decrease in our deferred revenue, partially offset by an $8.9 million decrease in accounts receivable associated with a decrease in revenue due to a lower number of Quarterly Paid Employers in our marketplace compared to the prior-year period, and a $1.1 million decrease in prepaid expenses and other assets.

Current wording

For the three months ended March 31, 2024, cash provided by operating activities was $2.0 million resulting from our net loss of $6.5 million, adjusted by non-cash charges of $7.0 million and a net increase of $1.6 million in our operating assets and liabilities. The non-cash charges primarily resulted from $18.6 million for stock-based compensation expense, $3.1 million pertaining to amortization of intangible assets and depreciation, and $1.0 million pertaining to non-cash lease expense, partially offset by $13.7 million related to the change in our deferred tax assets driven by our current year capitalization of research costs from a tax perspective, and $2.6 million in amortization and accretion of marketable securities. The increase of $1.6 million related to changes in our operating assets and liabilities was primarily driven by a $5.6 million increase in our accounts payable and accrued expenses and other liabilities, a $2.0 million decrease in prepaid expenses and other assets, and a $1.6 million decrease in accounts receivable associated with a decrease in revenue due to a lower number of Quarterly Paid Employers in our marketplace compared to the prior-year period, partially offset by a $6.9 million decrease in our accrued interest associated with our senior unsecured notes, and a $1.3 million decrease in our operating lease liabilities.

Previous wording

For the nine months ended September 30, 2023, cash provided by investing activities was $89.4 million resulting from $421.5 million received from paydowns, maturities and redemptions of marketable securities, partially offset by $323.8 million used in purchases of marketable securities and an increase in capitalized software development costs of $7.5 million.

Current wording

For the three months ended March 31, 2024, cash provided by investing activities was $5.7 million resulting from $151.5 million received from paydowns, maturities and redemptions of marketable securities, partially offset by $142.7 million used in purchases of marketable securities and capitalized software development costs of $2.9 million.

Previous wording

For the nine months ended September 30, 2024, cash used in financing activities was $43.6 million which consisted of $37.6 million used for the repurchase of common stock and $11.1 million for the net settlement of taxes on equity awards, partially offset by $3.6 million of proceeds from the issuance of stock under the employee stock purchase plan, and $1.5 million of proceeds from the exercise of stock options.

Current wording

For the three months ended March 31, 2025, cash used in financing activities was $26.5 million which consisted of $27.5 million used for the repurchase of common stock and $2.2 million for the net settlement of taxes on equity awards, partially offset by $1.7 million of proceeds from the issuance of stock under the employee stock purchase plan, and $1.5 million of proceeds from the exercise of stock options.

Previous wording

For the nine months ended September 30, 2023, cash used in financing activities was $142.2 million which consisted of $139.2 million used for the repurchase of common stock and $13.4 million for the net settlement of taxes on RSUs, partially offset by $6.4 million of proceeds from the issuance of stock under the employee stock purchase plan, and $4.0 million of proceeds from the exercise of stock options.

Current wording

For the three months ended March 31, 2024, cash used in financing activities was $8.3 million which consisted of $6.4 million used for the repurchase of common stock and $4.8 million for the net settlement of taxes on RSUs, partially offset by $2.6 million of proceeds from the issuance of stock under the employee stock purchase plan, and $0.3 million of proceeds from the exercise of stock options.

Previous wording

Our significant accounting policies are discussed in Note 2 – Basis of Presentation, Principles of Consolidation, and Summary of Significant Accounting Policies to our condensed consolidated financial statements included in this report. There have been no changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates discussed in the 2023 Form 10-K, except as set forth below.

Current wording

Our significant accounting policies are discussed in Note 2 – Basis of Presentation, Principles of Consolidation, and Summary of Significant Accounting Policies to our condensed consolidated financial statements included in this report. There have been no changes to our critical accounting policies and estimates as compared to the critical accounting policies and estimates discussed in the 2024 Form 10-K.