Nextdoor’s Earnings Call: Record Revenue Amid Challenges

Nextdoor Holdings, Inc. ((NXDR)) has held its Q3 earnings call. Read on for the main highlights of the call.

Nextdoor Holdings, Inc. recently held its earnings call, revealing a balanced sentiment that highlighted both strong financial performance and operational challenges. The company reported record revenue and positive adjusted EBITDA, signaling strategic advancements. However, a decline in active users and a GAAP net loss were also noted, indicating areas that require attention.

Record Quarterly Revenue

Nextdoor achieved its highest quarterly revenue ever, reaching $69 million, which marks a 5% increase year-over-year. This growth was primarily driven by strong demand from self-serve advertisers, showcasing the company’s ability to capitalize on this revenue stream.

Positive Adjusted EBITDA

The company reported a positive adjusted EBITDA of $4 million for Q3, representing a 6% margin and an 8-point improvement year-over-year. This positive margin reflects Nextdoor’s effective cost management and operational efficiency.

Self-Serve Revenue Growth

Self-serve revenue saw a significant 33% growth year-over-year, making up 60% of the total revenue. This was achieved through higher click-through rates and lower cost per click, indicating a successful strategy in optimizing advertising performance.

Programmatic Supply Integrations Completed

Nextdoor completed its programmatic supply integrations, which allows for deeper collaboration with scaled parties. A notable partnership with Yahoo was launched for off-platform advertising, expanding the company’s advertising reach.

Strong Cash Position

The company maintains a robust cash position with $403 million in cash, cash equivalents, and marketable securities, and no debt. This strong financial footing provides Nextdoor with the flexibility to invest in strategic initiatives.

New Chief Financial Officer

Indrajit Ponnambalam was announced as the new CFO, bringing over two decades of experience in finance and operations. His expertise is expected to further strengthen Nextdoor’s financial strategies and operational execution.

Decline in Platform WAU

Platform Weekly Active Users (WAU) declined to 21.6 million, attributed to an intentional reduction in notifications and email volumes. This reflects the company’s focus on enhancing user engagement quality rather than quantity.

GAAP Net Loss

Nextdoor reported a GAAP net loss of $13 million in Q3. This loss highlights the need for continued focus on cost management and revenue growth to achieve profitability.

Reduced User Acquisition Efforts

The company plans to reduce new user acquisition efforts in Q4, aiming to improve the user experience for new users. This strategic shift underscores a commitment to quality over quantity in user growth.

Forward-Looking Guidance

Looking ahead, Nextdoor forecasts Q4 2025 revenue between $67 million and $68 million, with an adjusted EBITDA range of $3.5 million to $4.5 million. The company projects full-year 2025 revenue growth of 3% to 4% and expects to reach breakeven adjusted EBITDA in 2026. These projections demonstrate a cautious yet optimistic outlook for future performance.

In summary, Nextdoor’s earnings call presented a mixed sentiment with strong financial metrics and strategic advancements counterbalanced by operational challenges. The company’s focus on self-serve revenue growth and strategic partnerships, along with a strong cash position, provides a solid foundation for future growth. However, addressing the decline in active users and achieving profitability remain critical areas for improvement.