Ziprecruiter Inc (ZIP) 2024 Q1 法說會逐字稿

Thank you for standing by. My name is Pam, and I will be your conference operator today. At this time, I would like to welcome everyone to the Ziprecruiter Inc, Q1 2024 earnings call. (Operator Instructions)

I would now like to turn the conference over to Drew Haroldson with Investor Relations. Please begin.

Thank you, operator, and good afternoon. Thank you for joining us on our earnings conference call, during which we will discuss the Ziprecruiter performance for the quarter ended March 31, 2024, and guidance for the second quarter 2024. Joining me on the call today are Ian Siegel, Co-Founder and CEO; David Travers, President, and Tim Yarbrough, CFO.

Before we begin, please be reminded that forward-looking statements made today are subject to risks and uncertainties relating to future events and or the future financial performances of Ziprecruiter. Actual results could differ materially from those anticipated in these forward-looking statements.

Discussion of some of these risk factors that could cause actual results to differ materially from any forward looking statements can be found in different previous quarterly report on Form 10Q for the quarter ended March 31, 2024, which is available on our investor website and the SEC's website.

The forward looking statements in this conference call are based on the current expectations as of today, and Ziprecruiter assumes no obligation to update or revise them, whether as a result of new developments or otherwise.

In addition, during today's call, we will discuss non-GAAP financial measures. These non-GAAP financial measures should be considered in addition to not as a substitute for or in isolation from GAAP results. The reconciliations of the non-GAAP metrics to the nearest GAAP metrics are included in Ziprecruiter shareholder letter and in our Form 10Q.

And now I will turn the call over to, Ian.

Thank you, and good afternoon to everyone joining us today. Q1 '24 revenue of $122 million was down 33% year-over-year, though it exceeded the midpoint of our guidance range. We generated $2 million in operating cash flow and $21 million in adjusted EBITDA, equating to an adjusted EBITDA margin of 17%.

Though results were above expectations discussed in our last earnings call, the labor market industry backdrop has remained challenging through the first few months of 2024. Hiring levels continue to be subdued and the number of people quitting their jobs also remains low as the big stay persisted into Q1.

However, there are also positive signs emerging as we began the year. Q1 '24 is the first quarter with a sequential increase in quarterly paid employers since 2022, and as a potential indicator of stabilization in the hiring market. While not yet a return to normal seasonality where revenue ramps from Q1 to Q2.

We see this as an early sign that the labor market downturn is potentially reaching a trough. Our balance sheet remains robust with over $510 million on hand. We are well positioned to whether this industry-wide downturn and enter an eventual recovery from a position of strength.

Therefore, we continue to lean into investments in product, technology and marketing that we expect to drive a significant long-term ROI. While we remain prepared for a wide range of scenarios, as 2024 plays out, we are poised to increase investment as opportunities arise and alternatively are always prepared to show further cost discipline if conditions deteriorate. We have strong conviction that technology will fundamentally change how employers and jobseekers connect to one another and Ziprecruiter will be at the forefront of that change.

Why are we so confident in our long-term outlook? There are several strategic advantages that have us well positioned for long-term growth. We have built an enduring brand as demonstrated by the 65% year-over- year organic job seeker traffic growth in Q1 of '24. Our matching technology is persistently getting better by utilizing the high volume of proprietary data points we gather from interaction between job seekers and employers in our marketplace.

(inaudible)AI driven career advisor who introduced many jobseekers to what it's like to have an ally in the job search process continues to expand his presence throughout Ziprecruiter experience. And finally, our 150 plus integrations with applicant tracking systems are nearly a decade in the making, making it easier for large enterprises to activate our solution.

While there are many reasons we believe Ziprecruiter will win, what will drive market share gains over time are advancements in product and technology, which are the center of our investments today. There is no doubt that the post COVID labor market backdrop has made the past few quarters challenging on the top line for us and throughout the recruitment industry. But we remain dedicated to and incredibly energized by our mission of actively connecting people to their next great opportunity.

With that, I will now turn the call over to Dave to review progress on our growth strategies. Dave?

Thank you, Ian, and good afternoon. As Ian mentioned, we are leaning into product and technology investments to capture the massive opportunity to transform how employers and jobseekers come together. I will detail the continued progress we are making against our three strategic pillars to improve outcomes for employers and jobseekers.

Our first strategic pillar is increasing the number of employers and the revenue per paid employer in our marketplace. Growing revenue from enterprise employers is a massive opportunity for Ziprecruiter. Our ongoing effort to introduce new ATS integrations and improve upon existing ones is an investment years in the making and a key strategy to growing enterprise revenue over time.

These ATS integrations create value across our marketplace with jobseekers and our ATS partners, benefiting from a smoother application experience and employers receiving a higher volume of applications. In Q1, we completed one of our newest ATS integrations with ISIMPS. With this integration, employers will be able to seamlessly tap into Ziprecruiters marketplace and unleash our matching technology to drive talented applicants to their job (inaudible).

Jobseekers can use Zip apply, our frictionless application process to apply to jobs in the ISIPMS, ATS without ever leaving the Ziprecruiter marketplace. But to apply conversion increases by more than 4times when customers move from external appliance physical plant.

Our automated campaign optimization solution launched in 2023 continues to get better at improving employers efficacy in hitting their desired campaign targets. In Q1, it was 17% more effective at achieving campaign targets than the prior quarter. And nearly 40% more effective compared to the prior year period. We believe that increasing the efficiency by which we achieve customer targets will lead to growth in enterprise revenue overtime.

I'll now move to our second pillar, increasing the number of job seekers in our marketplace. We continue to see strong organic job seeker activity, driven by multiyear brand investments. In Q1, organic visitors from job seekers grew 30% sequentially and over 65% year-over-year. Strong organic job seeker activity is a primary reason why we have been able to significantly reduce marketing expenses, as we balance our two-sided marketplace during this period of subdued hiring activity.

Additionally, in Q1, the downloads for industry-leading mobile app for iOS and Android grew 23% year-over-year, and engagement has remained strong as job clicks from our mobile apps increased 19% year-over-year. Additionally, in Q1, we streamlined the user experience for job seekers who prefer to hear about jobs via text messaging, which resulted in nearly 7times more opt-ins than the prior process flow.

As our matching technology continues to improve, we send jobseekers a text faster about a fresh relevant job when our technology is confident in the potential match rather than waiting to only send a text when jobseekers are invited to apply to a job by an employer. As a result, applications driven by text messaging grew over 3 times in Q1 compared to the prior quarter.

I'll conclude with our third pillar, making our matching technology smarter over time. In Q1, we rolled out an algorithm improvement for some job postings to drive more jobseekers toward jobs with fewer applicants. These are great jobs for jobseekers because, there's less competition from other applicants to get the job. This also benefits employers by optimizing application volume for their jobs. These algorithmic improvements are the result of long-term technology investments, and these investments are bearing fruit. For example, these jobs saw a year-over-year increase of 19% in applications per job in Q1.

Now I'll turn it over to Tim to talk through the financial results and our guidance. Tim?

Thank you, Dave, and good afternoon, everyone. Our first quarter revenue of $122 million represents a 33% decline year-over-year, primarily due to continued softness in hiring demand. Quarterly paid employers were 72,000, representing a 32% decrease versus Q1 '23, but a 1% increase sequentially.

Notably Q1 '24 is the first quarter with a sequential increase in quarterly paid employers since 2022, which is a potential sign of stabilization in the hiring market. Net loss was $7 million in Q1 '24 compared to net income of $5 million in Q1 '23 and $6 million in Q4 '23. Q1 '24 adjusted EBITDA was $21 million, equating to a margin of 17% compared to $35 million or margin of 19% in the prior year period and $42 million with a margin of 31% in Q4 '23.

Net income and adjusted EBITDA decreases both year-over-year and quarter-over-quarter are primarily related to revenue declines. Cash, cash equivalents and marketable securities was $513 million as of March 31, 2024, compared to $520 million as of December 31, 2023.

Moving on to guidance. Our Q2 '24 revenue guidance of $117 million at the midpoint represents a 31% decline year-over-year and a 4% decline quarter-over-quarter. Our adjusted EBITDA guidance for Q2 '24 is $15 million at the midpoint or a 13% adjusted EBITDA margin.

While this is not a return to normal seasonality, where revenue would ramp from Q1 to Q2, the midpoint of our revenue guidance would represent the lowest sequential decline we have seen since 2022. Our adjusted EBITDA guidance reflects a modest increase in operating expenses as we continue to hire top talent to invest in product and technology.

Assuming continued signs of stabilization of the hiring market referenced above, we believe it remains prudent to continue long term product technology and marketing investments in our marketplace, yielding low to mid teens adjusted EBITDA margins in 2024. We are constantly assessing the state of the labor market, leading data lead our decision making.

We are poised to increase investment as opportunities arise and alternatively are prepared to show further cost discipline if conditions deteriorate. Ziprecruiter is well positioned to take advantage of an eventual labor market recovery and emerge from this challenging period for the industry from a position of strength.

With that, we can now open the line for questions. Operator?

Thank you. We will now begin the question-and-answer session. (Operator Instructions)

Trevor Young, Barclays.

Great, thanks. And first one, can you just talk about the cadence of growth throughout the quarter. I think you'd normally be expecting momentum to kind of build each month throughout the quarter and then into 2Q. I don't think we saw that last year, given some of the softness at that point. But I'm just wondering kind of in light of that implied sequential decline in revs, is that same softness playing out this year as well?

Trevor, this is Tim. Thanks for the question. So, yes, last quarter, we talked about signs of labor market stabilization and what we saw throughout the course of Q1 largely reflected that. So, our guidance right now sequentially is roughly flat down just a tiny bit, but it's reflective of that kind of ongoing signs of stabilization that we saw in Q1 continuing through this quarter as well. So, we're encouraged by those signs.

Okay. Kind of relatedly, you know, QPE is firming up first time quarter-on-quarter and you know, more than a year, that's obviously pretty encouraging. Is that kind of a good level to model off of for the rest of the year, or is it still just a fairly uncertain outlook from here on the QPE front?

Yeah, I would say it could play out a couple of different ways. So, the the lift that we saw modestly in Q4 to Q1 was again pretty encouraging, and that's largely driven by SMBs. Coming back and, you see kind of the opposite effect on revenue per paid employer with that ticking down a little bit, and that's more of a seasonal trend.

So, for the rest of the year, it really does depend on to the extent that this flattening that we've been seeing continues out to extent that it does and I would expect that that number to remain fairly flat throughout the course of the year.

Trevor, this is Dave, just to add onto that, you're exactly right that the plan, that the quarterly paid employment numbers is really encouraging sign. And what we've seen, as we've discussed in the past what we've seen when there's a change in the macro environment, usually small businesses respond faster than large enterprises.

And that quarterly paid employer number is really driven by small businesses. So, we remain prepared for a wide range of scenarios, as we've said. But if that continues to be the case that we see signs of flattening that SMB driven quarterly paid employer numbers, a good barometer for that.

Okay, great. Thanks both, hopefully, that positive momentum continues.

Ralph Schackart, William Blair.

Good afternoon, thanks for taking the question. Maybe just to bolt on the prior question. Just curious what that trend line had has been, I guess, post Q1, if you've observed any sort of change in pattern or if it's sort of consistent with what we observed in Q1? That's my first question. I have a follow-up.

Yes, I think the pattern is largely consistent with what we saw in Q1. So, definitely not a return to the seasonality that we would normally expect, where Q2 would be sequentially higher than Q1. So, we haven't seen that. So, our guidance being down very modestly is basically showing that same signs of stabilization.

Great. Maybe just a follow up, I know it's really early tough to know whether your trough and right now or if you see any further downturns. But just curious, is this a little bit more broad-based? Is that vertical specific, but just any color you can provide some of the stabilization trends that you're seeing in the paid employee number? Thank you.

Sure, Ralph, this is Dave. So, yeah, we what, we see is that there's definitely strength in government and education, which we see largely as a catch-up from being industries that struggled to keep pace with wage increases during the post-COVID boom period. But what the year-over-year trends we see broadly based are encouraging as we see signs of flattening, clearly not looking across the broad scope of that calling a bottom, but also seeing very encouraging signs.

Great. Maybe just ask one more, Dave, just curious just in terms of the technology vertical, what you have observed within that technology? Thank you.

Yeah, technology continues to be one of the hardest hit areas of job posting and hiring activity when we looked on a year-over-year basis continues to be extremely impacted and is sort of an outlier on the negative end to the same extent that in a similar way, that government and education are on the positive end of the spectrum.

Okay. That's helpful. Thank you.

Doug Anmuth, JPMorgan.

Thanks so much for taking the questions. Guys. If you play out the scenario that things have troughed and maybe start to turn a bit here. Can you just talk more about how that informs your investment approach and what are some of the immediate steps you take as you lean back in more and then maybe just on the product side, can you provide an update on just how your AI matching technology is evolving and improving and perhaps what kind of lift you're seeing through different versions of the product? Thanks.

Hi, this is Ian, and I'll I'll take this question. I think one of the advantages that we have at Ziprecruiters that we've been doing sales and marketing for such an extended period of time that we have sensitive instruments for measuring whichever way the appetite for recruiting services is going and what you will see from us is that we will aggressively invest into any sort of return to normal or the end of the trough and the beginning of a climb that said.

And as excited as we are about the metrics that we're seeing right now. It is not a certainty and it is definitely too early to call. So, this could go either way and I think the great thing about the position we're in is, we're well prepared for either scenario. So, if things go well, we will be investing into that rapidly and we will be talking to you about that investment with great detail. If things continue as they are, we will continue as they are and then of course, if things were to get worse we would make appropriate austerity cost cuts in order to address that.

As far as our AI goes, we're just excited about what's happening with our AI across a wide variety of areas within our business. First of all, sale, our AI personal recruiter has been truly transformational to the job seeker experience, and that's measured quantitatively through the multiple engagement metric improvements that we've seen in a variety of different areas of the site.

It's everything from onboarding suggested jobs to till pitching these candidates to employers. I mean, one of the really telling metrics and impressive things that Phil was able to achieve this. We now have for new job seekers that come to the site as we reported a couple of quarters ago, over half of them are getting direct outreach from an employer within 24 hours, the first setting up on Ziprecruiter . And a lot of that is being driven by this AI matchmaker role that Phil is playing for us.

So, that's just indicative of the kind of power that this technology has. But then further, you can just see the persistent drumbeat of improvement across so many of the different algorithms that we use. And we're continuing to update you guys and report on these various improvements, which individually each of them has a small impact, but because of the cadence with which they're being delivered, our service is just getting better and better, both for small customers and for large customers.

And it was really highlighted by this last quarter, where we see a 19% improvement in the average number of applicants that SMB jobs are getting, which is a truly fantastic improvement when you consider the fact that the price did not change for these SMBs and they're just getting 19% more value. It's not just value for them, it's also value for the job seekers who are being directed to jobs that are in need of talent where they have a higher probability of getting hired and it's just a win-win for our marketplace.

I'm Dave, just to add onto that to link the two parts to your question. We've talked many times about the flexibility of our cost structure and our business model and we flexed up and down as market, sort of backdrop has changed. AI has really been the consistent area of ongoing investment throughout the cycle.

And you can see how R&D has been the most resilient and stable part of our cost structure over the past many quarters. And that's because of the investments we've been making and continue to make like Ian just discussed. So, that that's an area where we're going to continue to press our advantage and we feel very good about the results we've generated so far and we think we're just getting started.

Great, thank you, Ian and Dave.

Josh Beck, Raymond James.

Yeah, thank you so much for taking the question. Maybe just wanted to start off with the margins. Obviously, you came in kind of ahead of that kind of qualitative low to mid 10s guidance in the high 10s and you kind of left that in place, the low to mid 10s, just given the backdrop. So, I guess what investments are kind of rising to the top and what would you need to see, I guess, kind of one way or the other in terms of the macro to kind of adjust that framework?

Thanks for the question, Josh. This is Tim. Yeah. So, the margin structure came in at 17%. So, like you said, a bit better than the low to mid 10s. We still feel very good about that for the rest of the year. There might be some puts and takes as we go through Q3 and Q4 towards the back end of the year.

But overall that all assumes, again, a relatively consistent flattening across the board. But to the extent that we see the market softening or deteriorating a little bit more than we will take action to address that in terms of cost reductions.

But on the other hand, if things improve substantially, then we can ramp up that investment too. The form of that investment in the near term would most likely be sales and marketing spend. Just as we see demand on the employer side opening up. We have a highly metric to view of how we pursue those employers. And so we'd be happy to deploy capital with a long-term mindset.

Yeah, Josh, this is Dave. Our go-to-market teams are exceptionally good at this. So, as we read very rapidly, what the results of go-to-market investments are as an example. We then adjust, and so in Q1, you saw that level of investment appropriate to what we were seeing in the market and to the extent things change. We will not be hesitant to change our level of investment based on the returns we see, and those returns.

We measure those in three different ways. We think about the cash on cash returns. We think about the long term ROI, (inaudible) kind of returns. And we also think about the brand value we've built over time. And so there it's been an investment in the US hundreds of millions of dollars or over $1 billion over a decade that has led us to have 80% brand awareness on both sides of the marketplace.

And we see even as we pull back over the past few quarters on that investment, that brand investment remains enduring and so we're measuring all those things in calibrating our level of investment based on that.

This is Ian, where we will persistently invest is in R&D because, much like we think of our brand as one of our assets. The quality of the experience we're delivering is a huge part of the reason for the incredible surge in traffic that we're experiencing year-over-year this year.

Our traffic is up 60%, yes, because we do a lot of advertising, but also because, the experience is fundamentally improving and I can't say enough about Phil, who is becoming a conversational UI that's guiding jobseekers through their entire search experience.

He's really an ally for these individuals as they tried to find work, and I think we're feeling really excited about the future. So, R&D is going to continue to be an area of focused investment. And then on top of that, if we see a market turn, we will, of course, invest into it with our sales and marketing know-how.

Okay. That's all super helpful. Maybe a follow-up, just around enterprise. This ICON's partnership teams pretty substantial. I was looking up seems like they facility to over $5 billion hires last year, and they're a leader in the ATS space. So, could that move the needle? And then just maybe more broadly, like how should we be thinking about, just the pacing in terms of enterprise mixing up? Thank you.

Thanks, Josh. This is Dave. Great question. Yeah, [items] is a significant player in the applicant tracking system space well into the top 10 of a very fragmented market. So, there are very significant want to have some very large Fortune 500 clients, as well as a lot of more mid-market enterprise clients.

And so it's an important one for us. It's part of our overall strategy, where we have 150 and growing ATS integrations, where the software systems that are really the dashboard and the starting point every day for recruiters that these large enterprises to manage their entire workflow and for hiring managers to manage their workflow.

Having our candidates seamlessly show up in their workflow without ever having to leave the Ziprecruiter marketplace, which we call Zip apply is a huge part of that integration effort and having their jobs appear in our organic search results, so that when we knock on the door of a new enterprise prospect for the first time, we're already delivering candidates to them and showing we've already showed them value before we show up to talk to them for the first time is a really powerful model.

So, that's a significant investment in these 150 integrations. [Items] is a big one and allows us to really seamlessly and in a way that's better than than you can get it from other marketplaces field to integrate and also gives us an incredible amount of data that we can then use, where we see how our candidates perform over time via these integrations and then our AI tunes the algorithm in terms of the results to drive better and better candidates.

So, the more you work with Ziprecruiter, the more you invest with us, the better our results will get over time and we see that happening. The enterprise part of the market, which we view to be half of the market overall in the United States on a dollar basis is an area where we're underpenetrated and given our rapidly growing scaleion the jobseeker side of the marketplace. We're increasingly compelling given that 65% organic traffic growth is a place that we're really increasingly bullish.

The more we learn the more excited we are. But we also know that enterprises are slower to react to macro changes than SMB. So, as we see some macro backdrop change, we're very confident that enterprise demand will change as well, but it'll probably be a little bit slower if past is prologue, it will be a little bit slower to react in the SMB part of the market.

Thanks so much.

Brian Fitzgerald, Wells Fargo. Please go ahead.

Hi, this is Dan vertical for Brian. Thanks for taking our questions. I guess on focusing the question on the one of the growth pillars in a marketplace at the jobseeker. So, can you share more about the level of job seeker activity that you're seeing on the platform?

Any trends like incremental profiles created resumes added or updated visits engagements. And has the job seeker activity increased in the past few months, given the incremental changes in the most recent job market reports?

Hi, this is Ian. And what I would say is first broadly top of funnel job seeker traffic coming in, which is the 65% growth yea- over-year that we talked to you about. It's just way up and there are a variety of contributing factors to that, but what I'm very excited about is not just the top of funnel traffic. It's the down funnel metrics. It's the number of job seekers, who are being actively propositioned by an employer without having to go reach out to them first.

It's the number of applications per job that we're delivering to jobs in the SMB space. It's the number of times job seekers are showing jobs that they actually have interest in and should they apply. They will in fact be a top candidate for that job because, the algorithmic matching just continues to improve. So, really, it's the engagement metrics.

In addition to the top of funnel metrics, which have all been climbing, and there's a variety of inputs that have been driving these metrics up. Some of it is still in the process of having a human voice guiding the job seeker through the experience. It's been a force multiplier everywhere that we have put in.

Some of it is just straight technological algorithmic improvements and some of it is just site experience, which we also continue to improve. But across the board, it's not just top of funnel traffic. It's also the engagement metrics on our sites, and you can see that in a variety of different places that we have reported on.

But also it's interesting to see that the number of downloads of our mobile app, which is the preferred method of search for the really serious job seeker has also been going up pretty significantly. And so just generally, it's been a very good season for job seekers.

So, just want to add on to double-click on what you said about the 65% organic jobseeker growth and how we think about that. So, over that same year-over-year period, we've seen our sales and marketing investment come down by 38%.

And so, when you add up organic and pay according to third party data, we have, in March, our total US visits was up 13%, despite that reduction by 30% in sales and marketing. So, that's the power of those product investments and improvements that Ian was just talking about and those brand investments we, that are over the long term that we referenced earlier. And the net impact of that is that, we're growing overtime in March over 10-percentage-points faster than any of our largest competitors on the jobseeker front in the US.

I got it. Thank you.

Mark Mahaney, Evercore.

Hi, This is Luke on for Mark. What are some key data points suggesting to general market share shifts or any evidence you can offer that you're successfully gaining share versus your competitors? And then just a kind of second question, in the peak of the cycle, how high can the revenue per paid employer go like, what are some opportunities out there to grow revenue per paid employer over time? Thanks.

Great, this is Dave. I'll take the first part of that. So, it's a two-sided marketplace and so I would think about market share in two different ways. One I just referenced, which is growing the job seeker side in terms of visits year-over-year by 10-percentage-points faster than any other major player in our space. So, clearly, there we've seen over time a good historical correlation that, when there's a major move in job seeker market share employer dollars will follow. We've seen that over multiple players over multiple years.

And then on the employer side of things, we've seen large public staffing firms release. We don't have any pure-play online comps, but large public staffing firms have released, quarterly performance for Q1 and we saw US permanent placement revenue as low as 40% down year-over-year, which we think as we look across the market and our partners' data in our scope of the entire US labor market, that's a pretty good indicator of what's going on out there.

And so just stepping back about where we are in the macro and how to make sense of that, the US Bureau of Labor Statistics released that in March, the total hires in the US was $5.5 million seasonally adjusted. And so, if you look back over the last couple of recessions in 2007, right before the GFC, we were actually above $5.5 million in 2007.

And then back to the previous recession before the dot-com crash in early January 2001, we were also above $5.5 million. So, if you think back over the past 23 years, the GDP of the US adjusted for inflation in real terms has grown 61%. The labor force or the number of employed people has grown 19%.

But over that same time period, the number of hires last month was down 4%. And so that's an extremely unusual set of backdrop conditions. And so when we think about how we're doing and the [breadth] and scope of that in our games with the 65% growth in organic jobseeker growth. We feel very good about how we're doing against the market.

This is Tim. I'll take the second part of the question about revenue per paid employer, where we see that going. So, one of the long-term trends that we've seen in this business is that the revenue per paid employer has reliably trended up over time. And so that's true when you look at it on a consolidated quarterly basis.

And that's also true, perhaps more interestingly, when you look at it on a employer cohort basis. So, we've disclosed this a couple of times in the past in our annual filings, but if you look at the monthly revenue per employer per annual cohort reliably, those numbers trend up into the right as each cohort ages. And what we've seen in this last super cycle and the downside of that there have been just a few exceptions, but the larger trends, I think still hold to be very clearly true. Now where is, where do you see this number going? We have a lot of confidence that there's a lot of headroom and revenue per paid employer.

And to that, we can look at the offline solutions out there right now that are often charging anywhere from 15% to even 30% of first year's salary. We're not in the same ballpark as that. And so as our technology gets better and as this overall addressable market and of $250 billion shifting more towards the online solutions. We feel like we have much more pricing power as our technology gets better and better as we continue to win share away from offline competition.

Great, thank you so much.

Justin Patterson, KeyBanc Capital Markets.

Hi there. Thanks for taking the question. This is Myles Culiacan for Justin. First, just would love to know or hear your thoughts around visibility currently compared to the beginning of the year. And then second, just would love to hear more about the efforts to improve application rates for application rates. Now I've seen strong job seeker trends and the impact that can have to the business. Thank you.

Yes, this is Tim. I'll take the first part of the question. So, on visibility, I would say the future is still pretty murky because we haven't seen that return to seasonality that we would normally see in a year much, much more like 2019, for example. So, while we're encouraged by these signs stabilization and by paid employers being up modestly on a quarter-over-quarter basis. I wouldn't say that we're calling a trough or anything like that. So I'd say our level of visibility still remains fairly low, which is why we're still guiding one quarter out. But again, there's more optimism around the trends that we see.

And this is Ian. I'll take the back half of your question. So, when we look at our marketplace, we're very keen to understand what drives good connections between employers and job seekers, that is where a lot of our science goes and that manifests itself in a number of the product decisions we make, whether it's driving employers to outreach to jobseekers, so that it's the employer going first, which job seekers love or it's explaining to employers and such clear turns and making it so easy to display that they have salary on their job descriptions because, that materially increases the number of applicants who will actually apply to (inaudible) job.

And so in our marketplace, we are always looking for the different levers that we can take advantage of in order to increase that application rate. Over the last several quarters, I mean, we have launched a number of improvements that have been driving up this application rate, which is consequently been driving up a job seeker satisfaction, which is now manifesting in the surge in traffic that you are seeing today.

This is not just about advertising. This is also about actually delivering and we feel really confident that we are delivering already an exceptional experience, but we're particularly excited about where this will go over time. And like I said, it's not just top of funnel traffic. It's engagement metrics that are up and we believe that, that is a trend that we can persistently drive up into the right. As just as Tim was talking about revenue per paid employer, we think satisfaction is something where we still have headroom to grow.

Thank you. Helpful.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.