Nextdoor’s second quarter saw year-over-year improvements in both revenue and profitability, with management attributing results to ongoing transformation efforts centered on product upgrades, operational discipline, and enhanced advertiser value. CEO Nirav Tolia highlighted the recent launch of a rebuilt platform emphasizing local news, real-time alerts, and an AI-powered assistant, which together are designed to drive higher user engagement. Management pointed to the early success of these initiatives, such as a significant increase in Net Promoter Score, as proof points for their product direction. CFO Matt Anderson cited momentum in the self-serve advertising channel and improved cost efficiency as factors supporting the quarter’s operational gains.
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Nextdoor (NXDR) Q2 CY2025 Highlights:
- Revenue: $65.09 million vs analyst estimates of $61.34 million (2.8% year-on-year growth, 6.1% beat)
- Adjusted EPS: -$0.04 vs analyst estimates of -$0.05 ($0.01 beat)
- Adjusted EBITDA: -$2.25 million vs analyst estimates of -$9.81 million (-3.5% margin, 77.1% beat)
- Operating Margin: -31.1%, up from -77.4% in the same quarter last year
- Weekly Active Users: 45.71 million, up 609,069 year on year
- Market Capitalization: $674.4 million
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Nextdoor’s Q2 Earnings Call
- Jason Michael Kreyer (Craig-Hallum) asked about the timeline for restoring previous ad load levels given recent platform experiments. CEO Nirav Tolia explained the focus is on optimizing user experience, with new ad formats prioritized over simply increasing ad volume.
- Jason Michael Kreyer (Craig-Hallum) inquired about advertiser feedback on the new platform and ad formats. Tolia said marketers welcomed the user experience improvements and will be involved in shaping future ad offerings.
- Jamesmichael Sherman-Lewis (Citigroup) sought insight into evolving user behavior and which new surfaces drive the most engagement. Tolia reported high interest in local news and noted that alerts are valued but usage depends on real-world events.
- Jamesmichael Sherman-Lewis (Citigroup) questioned the outlook for large advertiser budgets and the effect of programmatic integrations. Anderson said improvements are emerging, with benefits for large advertisers expected as new integrations are completed later this year.
- Unidentified Analyst (B. Riley Securities) asked about the nationwide rollout of the Faves AI assistant. Tolia responded that expansion will proceed market-by-market through the year, with learnings from the beta guiding broader deployment.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will monitor (1) adoption rates and engagement levels for local news, real-time alerts, and the Faves AI assistant; (2) the pace and effectiveness of new programmatic advertising integrations, especially demand-side partnerships; and (3) execution of the announced operational restructuring, including leadership transitions and progress toward adjusted EBITDA breakeven. The balance between product innovation and cost discipline will remain a critical area of focus.
Nextdoor currently trades at $1.72, down from $1.85 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free for active Edge members).
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