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    ZIP
    Earnings call· Jun 2026(Q2 FY26)

    ZIPRECRUITER Q2 FY26 earnings call ZIP

    Aug 5, 2026 Source

    Executive summary

    ZipRecruiter Q2 FY26 — Product Innovations Drive Outperformance in Subdued Labor Market

    ZipRecruiter delivered strong Q2 FY26 results, outperforming guidance on both revenue and adjusted EBITDA, primarily driven by product innovations and AI-powered features that enhanced marketplace engagement. Despite a subdued labor market, the company's focus on driving conversations between employers and job seekers led to significant operational improvements and margin expansion. Management expects this momentum to continue, guiding for low single-digit revenue growth and further margin expansion for the full year.

    Highlights

    5

    • Revenue grew 5% year-over-year to $118.1 million, exceeding guidance midpoint by $6 million.

    • Adjusted EBITDA reached $14.6 million, representing a 12% margin, up from 8% in Q2 FY25 and above guidance midpoint.

    • Repurchased $294.6 million of 5% senior unsecured notes at a $65 million discount, significantly reducing debt.

    • Qualified application volume increased by 34% quarter-over-quarter due to next-gen search and matching engine.

    • Employer response rate per application doubled year-over-year, indicating improved marketplace engagement.

    Concerns

    2

    • Revenue per paid employer decreased 1% year-over-year and 2% sequentially to $1,669, primarily due to strong growth in new, partial-quarter employers.

    • The labor market remains subdued, with hires and quits near 15-year lows, posing a macro headwind that the company is currently outperforming.

    Guidance & targets

    6
    CategoryTargetConfidence
    Q3 FY26 Revenue
    $121 million at midpoint
    high materiality
    High
    Q3 FY26 Revenue Growth
    5% year-over-year
    high materiality
    High
    Q3 FY26 Adjusted EBITDA
    $16 million at midpoint
    high materiality
    High
    Q3 FY26 Adjusted EBITDA Margin
    13%
    high materiality
    High
    Full-year 2026 Revenue Growth
    low single-digit year-over-year growth
    high materiality
    Medium
    Full-year 2026 Adjusted EBITDA Margin
    12% to 14%
    high materiality
    High

    Operational metrics

    13
    Qualified application volume
    34%quarter-over-quarter increase
    Q2 FY26

    Increase due to ongoing rollout of next-generation search and matching engine.

    Employer response rate per application
    doubledyear-over-year
    Q2 FY26

    Lift due to product improvements, including next-gen search engine.

    Job seeker response rate with audio message
    8%lift
    Q2 FY26

    Job seekers using the 'Be Seen First' feature to record an audio message saw an 8% lift in response rates from employers.

    Automated campaign performance solutions adoption
    over 50%year-over-year growth
    Q2 FY26

    Growth in adoption by large employers.

    Rate of meeting customer campaign targets
    2xyear-over-year improvement
    Q2 FY26

    Improvement driven by optimizations to bidding algorithms.

    Performance marketing revenue
    15%year-over-year increase
    Q2 FY26

    Driven by increased efficacy and other improvements.

    Quarterly paid employers
    over 70,0007% year-over-year increase, 12% sequential increase
    Q2 FY26

    Strong growth in both new and returning customers.

    Revenue per paid employer
    $1,6691% year-over-year decrease, 2% sequential decrease
    Q2 FY26

    Decrease primarily due to strong growth in new employers joining partway through the quarter.

    Total operating expenses
    $101.3 milliondecreased from $106.9 million in prior year
    Q2 FY26

    Primarily due to lower stock-based compensation and personnel-related expenses.

    Net income margin
    37%
    Q2 FY26

    Increase due to gain on debt extinguishment.

    Adjusted EBITDA margin
    12%up from 8% in Q2 FY25 and 9% in Q1 FY26
    Q2 FY26

    Increases due to higher revenue and continued cost discipline.

    Debt repurchase discount
    $65 million
    Q2 FY26

    Repurchased over half of outstanding notes at a discounted par value.

    Cash, cash equivalents and marketable securities
    $173.8 million
    as of June 30, 2026

    Provides ample flexibility to fund future growth initiatives.

    Industry KPIs

    3
    MetricValueDetails
    Advertising revenue by segment15%%
    Share buyback capital returned$294.6 millionUSD
    Ai feature adoption monetization8%%

    Product announcements

    5
    ProductTypeDetails
    Next-generation search and matching enginemilestone
    Be Seen First - Audio Message Optionupdate
    Smart Outreachlaunch
    ZipRecruiter app for ChatGPT (deepened integration)update
    Claude Connectorlaunch

    Risks & headwinds

    1
    Subdued labor marketQ2 FY26 and ongoing

    Hires and quits rate remain near their lowest level since 2015.

    Mitigation: Company's product innovations and operational success allow it to outperform the market and take share even in a stable but subdued environment.

    What to watch in Q3 FY26

    5

    Q3 FY26 Revenue Growth

    Q3 FY26
    Current5% YoY in Q2 FY26
    Target5% year-over-year growth

    Why it matters

    Verifying the company's ability to maintain its accelerated growth trajectory in a stable labor market, as guided.

    We expect Q3 revenue of $121 million at the midpoint, representing 5% year-over-year growth and 2% sequential growth.

    Q&A highlights

    5

    Did the quarter accelerate as it progressed, and is the improvement due to product success or macro lift? Also, any vertical/employer size trends?

    Q2 saw a nice acceleration, leading to 5% YoY growth. The momentum was predominantly product-driven, with innovations like Be Seen First (8% lift) and the next-gen search engine (34% qualified applications) doubling employer response rates. The macro environment was a non-factor, remaining subdued with hires and quits near 15-year lows.

    “The macro was a nonfactor in Q2 as it relates to the momentum we created. It was all driven by our operational success.”

    asked by Joshua Chan · answered by Ian Siegel

    2 min read6 chapters

    Detailed Narrative

    01

    Q2 Performance and Product-Driven Momentum

    ZipRecruiter's Q2 FY26 performance exceeded expectations, with revenue of $118.1 million and adjusted EBITDA of $14.6 million. This outperformance was attributed to accelerated momentum driven by product improvements rather than macro tailwinds. The company emphasized that its innovations are focused on increasing conversations between employers and job seekers, which directly correlates with improved satisfaction and financial results.

    02

    Next-Generation Search and Matching Engine Impact

    The ongoing rollout of ZipRecruiter's next-generation search and matching engine significantly boosted marketplace efficiency. This innovation led to a 34% quarter-over-quarter increase in qualified application volume. Coupled with other product enhancements, this engine doubled the employer response rate per application year-over-year, highlighting its effectiveness in connecting the right candidates with employers.

    03

    AI-Powered Feature Launches

    ZipRecruiter introduced two key AI-driven features in Q2. The 'Be Seen First' feature now allows job seekers to record audio messages, resulting in an 8% lift in response rates for those who use it. Additionally, 'Smart Outreach' leverages AI to convert job descriptions into personalized, multi-step message campaigns for candidates in the resume database, automating initial touch points and improving employer efficiency.

    04

    Enterprise Strategy and Performance Marketing

    The company's enterprise strategy continues to gain traction, with adoption of automated campaign performance solutions growing over 50% year-over-year. These optimizations also led to a 2x year-over-year improvement in meeting customer campaign targets. Consequently, performance marketing revenue increased by 15% year-over-year in Q2, demonstrating the value of technology investments for large employers.

    05

    Expansion into Conversational AI Platforms

    ZipRecruiter expanded its distribution footprint by deepening integrations with leading conversational AI platforms. Following the Q1 launch of its app for ChatGPT, the company now allows job seekers to search for roles directly within the ChatGPT chat field. A new connector for Claude, Anthropic's AI Assistant, was also launched in Q2, aiming to meet job seekers where they are increasingly starting their search.

    06

    Financial Discipline and Debt Reduction

    The company demonstrated strong financial discipline, with total operating expenses decreasing to $101.3 million, down from $106.9 million in the prior year. This was primarily due to lower stock-based compensation and personnel-related expenses. ZipRecruiter also repurchased $294.6 million of its 5% senior unsecured notes at a $65 million discount, reducing debt and strengthening its balance sheet, which closed the quarter with $173.8 million in cash and investments.

    AI-generated summary of the company’s earnings call. Not investment advice.