What Happened?
Shares of local business platform Yelp (NYSE: YELP) fell 11.2% in the morning session after the company provided a weak sales and profit forecast for the full year 2026, which overshadowed its fourth-quarter results that beat some market estimates.
For the upcoming year, Yelp's revenue guidance of $1.47 billion at the midpoint fell 2.8% short of analyst expectations, and its adjusted EBITDA forecast of $320 million also missed consensus estimates. This disappointing outlook weighed on investor sentiment despite some bright spots in the fourth quarter. For the quarter, the company reported flat year-over-year revenue of $360 million, which was in line with expectations. However, it did report an adjusted EBITDA of $85.7 million and earnings per share of $0.61, both of which came in ahead of Wall Street estimates.
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What Is The Market Telling Us
Yelp’s shares are somewhat volatile and have had 10 moves greater than 5% over the last year. But moves this big are rare even for Yelp and indicate this news significantly impacted the market’s perception of the business.
The biggest move we wrote about over the last year was 9 months ago when the stock gained 10% on the news that 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.
Yelp is down 31.7% since the beginning of the year, and at $20.62 per share, it is trading 49.6% below its 52-week high of $40.93 from May 2025. Investors who bought $1,000 worth of Yelp’s shares 5 years ago would now be looking at an investment worth $570.35.
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