Nextdoor Q1 Earnings Call Highlights

Key Points

• Nextdoor delivered a stronger-than-expected Q1 2026, with revenue of $62 million, up 14% year over year and above guidance, while weekly active users rose to 22.3 million, an all-time high.
• Profitability improved sharply: GAAP net loss narrowed to $11 million and adjusted EBITDA was nearly breakeven, prompting the company to raise its full-year outlook to about 10% revenue growth and a high-single-digit EBITDA margin.
• Management says product and AI investments are driving momentum, including better ad targeting, new ad formats, and features like Ask and Opportunity Alerts that aim to boost engagement now and create future monetization opportunities.

Nextdoor NYSE: KIND reported a stronger-than-expected first quarter for 2026, with management pointing to record platform engagement, faster revenue growth and improved profitability as evidence that recent product and advertising investments are beginning to take hold.

Co-founder, Chief Executive Officer, President and Chairperson Nirav Tolia called the quarter “a standout” for the company, saying platform weekly active users reached an all-time high while revenue rose 14% year over year. Chief Financial Officer Indrajit Ponnambalam said the company’s platform weekly active users, or WAU, rose to 22.3 million from 21 million in the fourth quarter, reversing the recent sequential trend. WAU was also up slightly from 22 million in the first quarter of 2025.

Revenue totaled $62 million, above the company’s prior guidance range of $57 million to $59 million. Ponnambalam said the result was notable because the first quarter is historically Nextdoor’s softest period for advertising demand.

Revenue Growth Broad-Based Across Advertising Channels

Ponnambalam said revenue growth was “broad-based,” with every major monetization channel contributing, from small local advertisers to large national brands. The company’s self-serve channel grew 28% year over year and accounted for roughly 68% of total revenue.

He said ad stack improvements, including AI-assisted targeting and optimization and new ad formats, helped improve advertiser results, increase effective CPMs and reduce lower-quality backfill. Outside the U.S., Nextdoor expanded self-serve advertising into Canada and introduced click optimization in the U.K., which Ponnambalam described as the company’s first machine-learning-powered performance product in that market.

In response to an analyst question, Ponnambalam said direct sales with larger advertisers was likely the company’s strongest growth area during the quarter. Home services remained a standout category, while telco, technology, healthcare and financial services also performed well. He added that advertiser interest in video products increased year over year and that small and medium-sized business advertising also grew, with meaningful increases in average spend per advertiser.

Profitability Improves, New Buyback Authorized

Nextdoor reported a GAAP net loss of $11 million, representing a negative 19% margin and a 22-point improvement from the year-earlier period. Adjusted EBITDA was nearly breakeven at negative $200,000, compared with the company’s prior guidance for a loss of $4 million to $6 million. Ponnambalam said the result represented an approximately $9 million year-over-year improvement.

The company also said revenue per employee increased 31% year over year, which management cited as evidence of productivity gains and operating leverage.

During the quarter, Nextdoor repurchased 17 million shares for $29 million at an average price of $1.69 per share. The company ended the period with $373 million in cash equivalents and marketable securities and no debt. Ponnambalam also announced a new $100 million share repurchase authorization effective through June 2028, saying it gives the company flexibility to act opportunistically while preserving capacity to invest in growth and pursue strategic opportunities.

Guidance Raised After Strong Start

For the second quarter of 2026, Nextdoor expects revenue of $71 million to $73 million and adjusted EBITDA of $4 million to $6 million. Based on the first-quarter performance, the company raised its full-year outlook and now expects approximately 10% revenue growth for 2026, along with an adjusted EBITDA margin in the high single digits. That is up from prior guidance for a mid-single-digit adjusted EBITDA margin.

Ponnambalam said the updated outlook reflects the expected revenue trajectory, continued operating discipline and expanding leverage across the business. In response to an investor question, he said Nextdoor is already operating cash flow and free cash flow positive on a trailing 12-month basis, and that future free cash flow growth is expected to be primarily revenue-led. He added that the company will continue to use AI and other technologies to optimize operations.

Product Investments Focus on Relevance and Engagement

Tolia said Nextdoor’s main objective is to increase engagement among its more than 110 million verified users while continuing to attract new users. He said the company has spent the last two years “repairing the foundation” of the product and reducing features that may boost short-term engagement but do not improve long-term user satisfaction.

The company introduced threaded conversations, pinned comments, smarter linking, richer media in the feed and performance improvements tied to latency and infrastructure. Tolia also said Nextdoor began down-ranking self-promotional content for the first time.

Asked what the platform still needs to improve, Tolia said the central user need is relevant content. He said the company is working to improve content quality, support less active neighborhoods and invest in machine learning to personalize the experience. Tolia also said growth in the number of unique contributors during the quarter was an encouraging leading indicator because more contributors create more content and give users more reasons to return.

AI Seen as Core to Future Product Strategy

Tolia repeatedly emphasized the role of AI in Nextdoor’s strategy, arguing that verified human content becomes more valuable as machine-generated content becomes more common. He said Nextdoor’s network of verified neighbors and local context gives the company a differentiated foundation for AI-powered discovery.

One feature highlighted on the call was Ask, which uses AI to draw on 14 years of verified neighbor conversations to answer local questions. Tolia said Ask began as an AI assistant outside the feed but is now being embedded into gaps in feed conversations when neighbors are not immediately available to respond. He said early results have been encouraging, with higher engagement, more comments, improved conversation quality and more organic mentions of businesses.

Tolia said monetization is not the near-term objective for Ask, with engagement currently the priority. However, he said active recommendation-seeking creates the kind of high-intent environment advertisers value.

Management also discussed Opportunity Alerts as an emerging monetization product. Tolia said the feature connects neighbors who are asking for recommendations with service providers that want to serve them, adding that the company has seen positive signals in pricing and retention. He described the product as one of the more exciting monetization vehicles Nextdoor has seen in recent months, while noting it remains early.

About Nextdoor NYSE: KIND

Nextdoor, Inc NYSE: KIND operates a hyperlocal social networking platform that enables neighbors to connect, share information and foster community engagement. Through its website and mobile applications, Nextdoor offers features such as neighborhood newsfeeds, classified listings, recommendations, event planning tools and safety alerts. The company’s platform is designed to bridge the gap between digital communication and real-world community building by facilitating dialogue on topics ranging from local services and business referrals to public safety and community events.

Nextdoor generates revenue primarily through advertising and paid business services.

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