ZIP 10-K & 10-Q changes, risk factors and insider trading

RiskRisks Related to Our Business

There has been volatility in financial markets as a result of a number of factors, including, but not limited to, banking instability, global conflict, including the wars in Ukraine and the Middle East, inflation, changes in interest rates, and volatilechanges markets.in laws, regulations and administrative policy, including those that impact trade agreements and tariffs. There is a risk that as a result of these macroeconomic factors, we could continue to experience declines in all, or in portions, of our business. Economic uncertainty may cause some of our current or potential employers to curtail spending in our marketplace and may ultimately result in cost challenges to our operations. For example, our employers, including those of our employers that are banks, may be adversely affected by any bank failure or other event affecting financial institutions. Any resulting adverse effects to our employers’ liquidity or financial performance could reduce the demand for our services or affect our allowance for expected credit losses and collectability of accounts receivable. In addition, any significant changes to U.S. trade policies, treaties or tariffs, or the perception that any of them could occur, may have a material adverse effect on global economic conditions and the stability of global financial markets, and may significantly reduce global trade and, in particular, trade between the impacted nations and the United States. These adverse conditions could result in reductions in revenue, increased operating expenses, longer sales cycles, slower adoption of new technologies, and increased competition. We cannot predict the timing, strength, or duration of any economic slowdown or any subsequent recovery generally. There is also risk that when overall global economic conditions are positive, our business could be negatively impacted by decreased demand for job postings and our services. If generalthere is a significant or prolonged decline in economic conditions significantly deviate from present levels,conditions, our business, financial condition, and operating results could be adversely affected.

Substantially all of our revenue is generated by our business operations in the United States. Prior to 2020, the United States had largely experienced positive economic and employment trends since our founding in 2010 and therefore we do not have a significant operating history in periods of weak economic environments and cannot predict how our business will perform in such periods. Any significant economic downturn in the United States or other countries in which we operate could have a material adverse effect on our business, financial condition and results of operations.

We face intense competition from many well-established online job sites such as CareerBuilder and Monster, Craigslist, Glassdoor, Google, Indeed, LinkedIn, and LinkedIn, as well as from newer entrants such as Google or Facebook.Meta. Many of our existing and potential competitors are considerably larger or more established than we are and have larger workforces and more substantial marketing and financial resources. Price competition for job marketplaces such as ours is likely to remain high, which could limit our ability to maintain or increase our market share, subscriber base, revenue and/or profitability.

We also compete with other companies that utilize emerging technologies and assets, such as large language models (LLMs), machine learning, and other types of AI. TheseWhile we also may utilize such technologies, these competitors may offer products and services that may, among other things, provide automated alternatives to the services that employers or job seekers would otherwise seek from ZipRecruiter, use machine learning algorithms to connect employers with job seekers more effectively than we do, or otherwise change the way that employers engage with job seekers or the way job seekers apply to jobs or find work so as to make our marketplace less attractive. We may face increased competition from these competitors as they mature and expand their capabilities.

Many of our competitors are able to devote greater resources to the development, promotion, sale, and support of their products and services. Furthermore, our current or potential competitors may be acquired by third parties with greater available resources and the ability to initiate or withstand substantial price competition. Our competitors may also establish cooperative relationships among themselves or with third parties to enhance their product offerings and/or resources. If our competitors’ products, platforms, services or technologies maintain or achieve greater market acceptance than ours, if they are successful in bringing their products or services to market earlier than ours, or if their products, platforms or services are more technologically capable than ours, then our revenue could be adversely affected. Also, some of our competitors may offer their products and services at a lower price. If we cannot optimize pricing, our operating results may be negatively affected. Pricing pressures and increased competition could result in reduced sales, reduced margins, losses or a failure to maintain or improve our competitive market position, any of which could adversely affect our business.

Our marketplace functions on software that is highly technical and complex and if it fails to perform properly, our reputation could be adversely affected, our market share could decline and we could be subject to liability claims.decline.

Our ability to increase revenue and profitability depends, in part, on widespread acceptance and utilization of our marketplace by businesses of all sizes and types. Because our customers reflect a wide variety of businesses, we face a variety of challenges, including but not limited to, pricing pressure, cost variances and marketing strategies that vary based on the business type and size, varying lengths of sales cycles, and less predictability in completing some of our sales. For example, some of our larger prospective customers may need us to provide greater levels of education regarding the use and benefits of our marketplace and services, because the prospective customer’s decision to use our marketplace and services may be a company-wide decision. We are in the early stages ofcontinuously developing and refining the analytical tools that will allow us to determine how prospective customers can be most effectively directed within, and addressed by, our sales organizations. As a result, we may not always approach new opportunities in the most cost-effective manner or with the most appropriate resources. Developing and successfully implementing these tools will be important as we seek to efficiently capitalize on new and expanding market opportunities. In addition, because we are a relatively new company with a limited operating history when compared to some of our existing competitors, our target employers and job seekers may prefer to use offerings from more established competitors that are more tailored to their specific requirements.

Our business depends largely on our ability to attract and retain talented employees, including senior management and key personnel. IfIn particular, if we lose the services of Ian Siegel, our Chief Executive Officer, or other members of our senior management team, we may not be able to execute on our business strategy.

Our future success also depends on our continuing ability to attract, train, and retain highly skilled personnel, including software engineers and sales personnel. We face intense competition for qualified personnel from numerous software and other technology companies. This competition for highly skilled personnel is especially intense in the regions where we have significant operations, and we may incur significant costs to attract and retain them. We have, from time to time, experienced, and we expect to continue to experience, difficulty in hiring and retaining highly skilled employees with appropriate qualifications. We may incur significant costs to attract and retain highly skilled personnel, and we may lose new employees to our competitors or other technology companies before we realize the benefit of our investment in recruiting and training them. In addition, in a tight labor market, we may experience increased difficulty in hiring and retaining, or increased costs in attracting and retaining, highly skilled personnel, or we may lose new employees to our competitors or other technology companies at a greater rate. To the extent we move into new geographies, we would need to attract and recruit skilled personnel in those areas. Moreover, remote work opportunities could negatively impact our ability to recruit or retain talent, particularly in light of our workforce historically being concentrated largely in the Los Angeles and Phoenix metropolitan areas. In addition, job candidates and existing employees often consider the value of the equity awards they receive in connection with their employment. If the perceived value of our equity or equity awards declines, it may adversely affect our ability to retain highly skilled employees. If we cannot attract and retain suitably qualified individuals who are capable of meeting our growing technical, operational, and managerial requirements, on a timely basis or at all, our business may be adversely affected.

We depend in part on various internet search engines, such as Google, as well as other channelschannels, such as generative AI engines, to direct a significant amount of traffic to our website. Our ability to maintain the number of visitors directed to our website is not entirely within our control. For example, our competitors’ search engine optimization and other efforts such as paid search may result in their websites receiving a higher search result page ranking than ours, internet search engines or other channels that we utilize to direct traffic to our website could revise their methodologies in a manner that adversely impacts traffic to our website, or we may make changes to our website that adversely impact our search engine optimization rankings and traffic. As a result, links to our website may not be prominent enough to drive sufficient traffic to our website, and we may not be able to influence the results. Additionally, the manner in which generative AI platforms decide what information to provide in response to a given user query may also result in our website receiving less attention by users of these tools.

Our quarterly results of operations, including the levels of our revenue, gross margin, and profitability, may vary significantly in the future and period to period comparisons of our operating results may not be meaningful. Accordingly, the results of any one quarter should not be relied upon as an indication of future performance. We also have a limited operating history and make pricing and other changes from time to time, all of which makemakes it difficult to forecast our future results. As a result, you should not rely upon our past quarterly operating results as indicators of future performance.

•general economic, industry and market conditions, including inflationary pressures, a volatile interest rate environment, increasing borrowing costs, actual or perceived instability in the global banking industry and the impacts therefrom, cybersecurity incidents, thechanges U.S.in presidentiallaws, regulations and otheradministrative federal,policy, state,including those that impact trade agreements and local elections,tariffs, and the impacts of the wars in Ukraine and the Middle East;

If we are not able to provide successful enhancements,enhancements and new products, services, and features, our business could be adversely affected.

To grow our business and the number of job seekers and employers in our marketplace, we anticipate that we will continue to depend, in part, on relationships with Job Distribution Partners and Job Acquisition Partners. Job Distribution Partners are third-party sites who have a relationship with us and advertise jobs from our marketplace, and include job boards, newspaper classifieds, search engines, social networks, talent communities and resume services, while Job Acquisition Partners are third-party sites and ATSs who have a relationship with us and from whom we receive jobs for our marketplace. Our competitors may be effective in providing incentives to these Job Distribution Partners to favor their products or services or to prevent or reduce engagement with our marketplace. In addition, acquisitions of our Job Distribution Partners or Job Acquisition Partners by our competitors could reduce the number of our current and potential employers and job seekers as well as the number of job postings accessible by our marketplace. We cannot guarantee that the Job Distribution Partners and Job Acquisition Partners with which we have strategic relationships will continue to offer the services for which we rely on them, devote the resources necessary to expand our reach, or support an increased number of employers and job seekers and associated use cases. Further, some of our Job Distribution Partners and Job Acquisition Partners offer, or could offer, competing products and services or also work with our competitors. They may also choose to develop alternative products and services in addition to, or in lieu of, our marketplace, either on their own or in collaboration with others, including our competitors.

Our corporate culture has contributed to our success, and if we cannot maintain this culture as we grow,culture, we could lose the innovation, creativity, and teamwork fostered by our culture, and our business may be harmed.

We believe that our corporate culture has been a key contributor to our success. If we do not continue to develop our corporate culture as we grow and evolve,culture, it could harm our ability to foster the innovation, creativity, and teamwork we believe that we needneed. toOver support our growth. As our organization grows and we are required to implement more complex organizational structures,time, we may find it increasingly difficult to maintain the beneficial aspects of our corporate culture, which could negatively impact our future success. Furthermore, we have instituted, and may again in the future institute, restructuring plans, such as the one enacted in May 2023, which may result in increased attrition beyond our intended reduction in force, reduce employee morale, and negatively impact employee recruiting and retention. If we fail to attract new personnel, or fail to retain and motivate our current personnel, our business and growth prospects could be harmed.

Additionally, our hybrid working environment may impede our ability to foster a creative environment and adversely affect the productivity of our team members and overall operations, which could have a material adverse effect on our business, results of operations, financial condition, and future prospects. Our return-to-workhybrid work approach may change at any time, and may vary among geographies.

Our ability to increase our Paid Employer base and achieve broader market acceptance of our marketplace will depend significantly on our ability to continue to expand our sales and marketing operations. We plan to continue to expand our sales force and to dedicate significant and increasing resources to sales and marketing programs. We are expanding our sales and marketing capabilities to target additional potential Paid Employers, including some larger organizations, but there is no guarantee that we will be successful in attracting and maintaining these businesses as users, and even if we are successful, these efforts may divert our resources away from and negatively impact our ability to attract and maintain our current Paid Employer base. All of these efforts will require us to invest significant financial and other resources. If we cannot find efficient ways to deploy our marketing spend or to hire, develop, and retain talented sales personnel in numbers required to maintain and support our growth, if our new sales personnel cannot achieve desired productivity levels in a reasonable period of time, or if our sales and marketing programs are not effective, our ability to increase our Paid Employer base and achieve broader market acceptance of our services could be harmed.

We have incurred net losses in the past, anticipate increasing our operating expenses in the future, and may not sustainregain profitability.

While we earned net income of $49.1 million and $61.5 million for the years ended December 31, 2023 and 2022, respectively, we have also incurred significant net losses in subsequent periods, including a net loss of $33.0 million for the year ended December 31, 2025 and a net loss of $12.9 million for the year ended December 31, 2024 and have incurred significant net losses in the past.2024. As of December 31, 2024,2025, we had an accumulated deficit of $18.4$76.6 million. Additionally, we expect to make significant future expenditures related to the development and expansion of our business, including investing in our technology to improve our marketplace and investing in sales and marketing channels to enhance our brand promotion efforts. These efforts may prove more expensive than we currently anticipate, and we may not succeed in increasing our revenue sufficiently to offset these higher expenses. If our revenue declines or fails to grow at a rate faster than increases in our operating expenses, we will not be able to regain or maintain profitability in future periods. As a result, we may continue to generate losses. We cannot ensure that we will achieve profitability in the future or that we can sustain profitability.

We rely on Amazon Web Services, or AWS, to host our marketplace,marketplace and other service providers for certain critical business processes, and any disruption of service from AWS or other critical service providers or material change to our arrangement with AWS or other critical service providers could adversely affect our business.

We currently host our marketplace and support most of our operations using AWS, a provider of cloud infrastructure services.services, and we use other service providers to provide certain critical business processes. We do not control the operations of AWS’s facilities.facilities or the facilities of our other critical service providers. AWS’s and other critical service providers’ facilities are vulnerable to damage or interruption from earthquakes, hurricanes, floods, fires, cyber security attacks, terrorist attacks, power losses, telecommunications failures, and similar events or could be subject to break-ins, cybersecurity incidents (including unauthorized access to or other compromise of information technology systems and data stored therein), sabotage, intentional acts of vandalism, and other misconduct. The occurrence of any of these events, a decision to close the facilities or cease or limit providing services to us without adequate notice, or other unanticipated problems could result in interruptions to our marketplace, which may be lengthy. Our marketplace’s continuing and uninterrupted performance is critical to our success and employers and job seekers may become dissatisfied by service interruption. Sustained or repeated system failures could reduce the attractiveness of our marketplace to employers and job seekers, cause employers and job seekers to decrease their use of or stop using our marketplace, and adversely affect our business. Moreover, negative publicity from disruptions could damage our reputation.

AWS doesand other critical service providers do not have an obligation to renew itstheir respective agreements with us on commercially reasonable terms, or at all. If we cannot renew our agreementagreements or are unable to renew on commercially reasonable terms, we may experience costs or downtime in connection with the transfer to, or the addition of, new cloud infrastructure or other data center.center or another critical service provider. If these providers charge high costs for or increase the cost of their services, we will experience higher costs to operate our business and may have to increase the fees to use our marketplace and our operating results may be adversely impacted.

Upon expiration or termination of our respective agreement with AWS,AWS or other critical service providers, we may not be able to replace the services provided to us in a timely manner or on terms and conditions, including service levels and cost, that are favorable to us, and a transition from one vendor to another vendor could subject us to operational delays and inefficiencies until the transition is complete. Switching our operations from AWS to another cloud or other data center provider would also be technically difficult, expensive, and time consuming.

Our business involves the storage, processing, and transmission of proprietary, confidential, and personal information, and relies on computer systems, hardware, software, technology infrastructure and online sites and networks for both internal and external operations that are critical to our business, or IT Systems. We own and manage some of these systemsIT Systems but also rely on the use of third-party partners and vendors for a range of IT Systems, who also store, process, and transmit user information. We also maintain certain other proprietary and confidential information relating to our business and personal information of our personnel, website visitors and other individuals we interact with. We have previously experienced multiple data security incidents involving the unauthorized access to personal information of job seekers utilizing our services (including their resumes) as well as affecting our business clients’ accounts, some of which have required us to notify affected individuals and/or regulators. There are no assurances that other data security incidents will not occur in the future. These incidents and any future data security breach that we or our vendors and third-party partners experience, such as those caused through hacking, social engineering, phishing, insufficient access controls and/or end-user or customer account controls and/or security measures, including user or customer account takeovers, credential stuffing, malware (including ransomware), vulnerabilities, malfeasance by insiders, human or technological error,error or mistake, as a result of malicious code embedded in software, physical or electronic-break-in, weakness resulting from intentional or unintentional service provider actions, or other data privacy or security incident, whether intentionally or unintentionally caused by us or by third parties could result in: unauthorized access to, misuse of, or unauthorized acquisition of IT Systems and our, our personnel’s, our users’, or our customers’ data; the loss, corruption, or alteration of this data; interruptions in our operations; unavailability of our website and applications; or damage to our computers or systems or those of our users.users; Any of these could expose us to claims, litigation, fines,or other potentialsecurity liability,incident, anddata reputationalbreach, harm,or and materially impact our operations, business and financial results.ransomware. Moreover, we have acquired and continue to acquire companies with cybersecurity vulnerabilities and/or are similarly susceptible to the risks described above, which exposes us to significant cybersecurity, operational, and financial risks.

An increasing number of online services have also disclosed security breaches, some of which involved sophisticated and highly targeted attacks. As threat actors become increasingly sophisticated in using techniques and tools (including AI) that circumvent security controls, evade detection and remove forensic evidence, we may be unable to protect the confidentiality, integrity and/or availability of our IT Systems or confidential information, and may not be able to detect, investigate, remediate or recover from future attacks or incidents, or to avoid a material adverse impact to our IT systems, confidential information or business. Further, as our profile and name recognition increase, we may be targeted more frequently. Additionally, malware, viruses, social engineering (including business email compromise), and general hacking in our industry have become more prevalent and more complex. Further, due to the shift to remote and hybrid work, there is an increased risk that we may experience cybersecurity related incidents, including breaches of IT Systems security, as a result of our employees, service providers, and third parties working remotely on less secure systems. Threat actors are becoming increasingly sophisticated in using techniques and tools (including AI) to obtain unauthorized access, disable or degrade service, sabotage systems, or otherwise circumvent security controls, evade detection and remove forensic evidence, and theseactors’ techniques change frequently and often are not foreseeable or recognized until launched against a target. As a result, we and our third-party partners and vendors may be unable to anticipate these techniques, implement adequate preventative measures, or investigate, remediate and recover from incidents. If an actual or perceived breach of our or our third-party partners’ or vendors’ security or privacy or other data privacy or security incident occurs, public perception of the effectiveness of our security measures and brand could be harmed, and we could lose users and business.

Data security breaches and other data privacy and security incidents may also result from non-technical means, for example, through human error. Any such security compromise could result in a violation of applicable data privacy, security, breach notification and other laws, regulatory or other governmental investigations, enforcement actions, litigation,litigation (including class action litigation), and legal and financial exposure, including potential contractual liability. We may need to expend significant resources to protect against, and to address issues created by, security breaches and other privacy and security incidents. These liabilities may exceed the amounts covered by our insurance or our insurance coverage may not extend to or be adequate for liabilities actually incurred, or our insurance may not continue to be available to us on economically reasonable terms, or at all. Any such compromise could also result in damage to our reputation, a loss of confidence in our security measures, and an adverse impact our business.

Changes in laws or regulations relating to data privacy, the protection, collection, storage, processing, transfer, or use of personal data,information, the use of AI, or consumer protection, or any actual or perceived failure by us to comply with such laws and regulations orregulations, our privacy policies,policies or other obligations, could adversely affect our business.

We are also subject to the terms of our privacy policies and obligations to third parties related to privacy, data protection, AI, and information security. The regulatory framework for privacy, data protection and AI worldwide is uncertain and complex, and these or other actual or alleged obligations may be interpreted and applied in ways we do not anticipate or that are inconsistent from one jurisdiction to another and may conflict with other rules or our practices. Further, any significant change to applicable laws, regulations, or industry practices regarding the collection, use, processing, retention, security, disclosure or disclosureother processing of the data of our employers and job seekers, employees, contractors, or others, or their interpretation, or any changes regarding the manner in which the express or implied consent of employers and job seekers for the collection, use, processing, retention, or disclosure of such data must be obtained, or any limitations on how we can collect, use, process, retain or disclose such data, could increase our costscosts, limit our development of new services or features, or the taking of new initiatives, and/or require us to modify our services and features, which may be materialmaterial, limiting or not cost-effective, and may limit our storage and processing of user data or develop new services and features.cost-effective.

We also expect that there will continue to be new laws, regulations, and industry standards concerning privacy, data protection, AI, and information security proposed and enacted in various jurisdictions. For example, in 2018, European legislators adopted the General Data Protection Regulation, or the GDPR, which imposes more stringent European Union, or EU, data protection requirements, and provides for significant penalties for noncompliance. The GDPR also confers a private right of action on data subjects and consumer associations to lodge complaints with supervisory authorities, seek judicial remedies, and obtain compensation for damages resulting from violations of the GDPR. Compliance with the GDPR has been and will continue to be a rigorous and time-intensive process that may increase our cost of doing business or require us to change our business practices, and may subject us to governmental investigations or enforcement actions, fines and penalties, claims, litigation, and reputational harm in connection with any European activities. Further, the United Kingdom, or the UK, has enacted the UK GDPR, which, together with the amended UK Data Protection Act 2018, or DPA, and the UK Data Use and Access Act 2025, retains the GDPR in UK national law. Fines for certain breaches of the GDPR and the UK data protection regime are significant (e.g., fines for certain breaches of the GDPR or the UK GDPR are up to the greater of 20 million Euros (or 17.5 million GBP under the UK GDPR) or 4% of total global annual turnover), and since we are under the supervision of relevant data protection authorities in both the EU and the UK, we may be fined under both the GDPR and the UK GDPR for the same breach.

Additionally, the California Consumer Privacy Act, or CCPA, which afforded new data privacy rights for consumers and new operational requirements for companies, came into force in 2020, and also provides for fines for noncompliance. The California Privacy Rights Act, or CPRA, which took effect on January 1, 2023, further expanded the CCPA with additional data privacy compliance requirements and rights for California consumers, and established a new regulatory agency dedicated to enforcing those requirements and issuingimplementing additional rulemaking,rules, including within respectthe toareas of cybersecurity audits, risk assessment, and automated decisionmakingdecision-making technology. Comprehensive privacy legislation has also been enacted,enacted and taken effect or is soon going into effect, in more than one-third of U.S. states (with several states going into effect in the near future) and each imposes similar, but not identical, compliance obligations. Similar laws have been proposed in many other states and at the federal level as well, which may impose significant obligations and restrictions. The effects of these laws are potentially significant and may require us to modify our data collection or processing practices and policies and to incur substantial costs and expenses in an effort to comply, and increase our potential exposure to regulatory enforcement and/or litigation.

Moreover, several U.S. and European jurisdictions arecurrently lookingor towill soon regulate specific uses of AI. For example, New York City currently regulates the use of automated employment decision tools by employers and employment agencies,agencies; Utah regulates disclosures for the use of generative AI,AI; Illinois regulates AI in employment decision-making process; and Texas prohibits specific AI use cases (including those developed or deployed with the intent of unlawfully discriminating against a protected class under federal or state law). Colorado will soon regulate the use of high-risk AI (which definition includes an AI system that is a substantial factor in making a decision that has a significant effect on employment or employment opportunities). California has also enacted seventeenseveral new AI laws in 2024 that further regulate use of AI and machine learning technologies, or AI Technologies, and provide consumers with additional protections around companies’ use of AI Technologies, such as requiring companies to disclose certain uses of generative AI, AI Technologies, and the types of data used to train such models. Relatedly, various state laws including the CCPA regulate the use of automated decision making technology that results in legal or similarly significant effects on individuals, and provide rights to individuals with respect to that automated decision making.

In the EU, the Artificial Intelligence Act, or the EU AI Act, entered into force in August 2024. The EU AI Act seeks to create a establishing a comprehensive legal framework for the regulation of AI systems across the EU. The majority of obligations under the EU AI Act are expected to take effect in August 2026. Once fully applicable, the EU AI Act will have a material impact on the way AI is regulated in the EU, including, for certain types of AI systems, requirements around transparency, conformity assessments and monitoring, risk assessments, human oversight, security, accuracy, general purpose AI and foundation models, and fines for breach of up to 7% of worldwide annual turnover. Failure to comply with such laws or regulations could subject us to legal or regulatory liability. Further, the cost to comply with such laws or regulations could be significant and would increase our operating expenses, which could adversely affect our business, financial condition and results of operations.

The regulatory framework for AI Technologies has also already shifted significantly as the technology continues to evolve. For example, in the United States, the Trump administrationAdministration in early 2025 rescinded an executive order relating to the safe and secure development of AI Technologies that was previously implemented by the Biden administrationAdministration in 2023. The Trump administrationAdministration then issued a new executive order that, among other things, requires certain agencies to develop and submit to the president action plans to “sustain and enhance America’s global AI dominance,” and to specifically review and, if possible, rescind rulemaking taken pursuant to the rescinded Biden executive order. Thus,In July 2025, the Trump administrationAdministration further issued America’s AI Action Plan focusing on the three pillars of innovation, infrastructure, and international diplomacy and security in AI, and seven underlying principles. In December 2025, the Trump Administration issued another executive order establishing a federal policy favoring a uniform national AI regulatory framework designed to promote innovation and U.S. global competitiveness and directing federal agencies to identify, challenge, and potentially pre-empt state and local AI laws that are viewed as inconsistent with or burdensome to this national approach. It remains to be seen how agencies will effectuate this directive, and how states will approach AI legislation moving forward, and the Trump Administration may continue to rescind other existing federal orders and/or administrative policies relating to AI Technologies, or may implement new executive orders and/or other rule making relating to AI Technologies in the future. Any such changes at the federal level could require us to expend significant resources to modify our products, services, or operations to ensure compliance with old frameworks.frameworks or meet new obligations.

We are also subject to different consumer protection laws, including laws that regulate the FTC’soffering recentlyof automatically renewing subscription offers. For example, the Federal Trade Commission, or FTC, previously implemented the “Click-to-Cancel” rule that prohibitswould have prohibited covered businesses from, amongst other things, impeding consumers (including in business-to-business transactions) from canceling recurring subscriptions and memberships,memberships. failingHowever, on July 8, 2025, the U.S. Court of Appeals for the Eighth Circuit vacated the entirety of the “Click-to-Cancel” rule due to clearlya andfinding conspicuouslyof discloseflaws material terms prior to obtaining an individual’s billing information, and failing to obtain express informed consent before chargingin the individual.FTC’s Whilerulemaking theprocess. grace period for compliance ends on May 14, 2025, legal challenges to theThe rule may resultstill be appealed by the FTC or the FTC may engage in modificationsfurther torulemaking theprocesses. ruleHowever, orthere delaysare instill enforcement,other orstate resultlaws inaround thethese ruletopics being rescinded altogether. We face risks if we cannot comply with the rule, and because the outcome of the legal challenge remains uncertain,that we may incurbe required to comply with, and which compliance costsrequirements ormay make changes toimpact our business practices in ways that areimpact ultimatelyour not required.revenues.

The costs of compliance with, and other burdens imposed by, thedata GDPR,privacy, the UK GDPR, the DPA, the CCPA,IA, consumer protection requirements and other laws and regulations may limit the use and adoption of our products and services and could have an adverse impact on our business. As a result, we may need to modify the way we treat, process, or store such information or offer our products and services.

We use AI Technologies throughout our business and are making significant investments in this area. For example, we use AI Technologies within our platform to actively connect employers and job seekers, and to help retrieve and appropriately display search results.results, to optimize job matches and recommendations, and to improve the services we provide. As with many technological innovations, there are significant risks involved in developing, maintaining and deploying these technologies and there can be no assurance that the usage of or our investments in such technologies will always enhance our products or services or be beneficial to our business, including our efficiency or profitability. In particular, if the models underlying these AI Technologies are: (i) incorrectly designed or implemented; (ii) trained or reliant on incomplete, inadequate, inaccurate, flawed, biased or otherwise poor quality data, or on data to which we do not have sufficient rights or in relation to which we and/or the providers of such data have not implemented sufficient legal compliance measures; (iii) used without sufficient oversight and governance to ensure their responsible use; (iv) providing outputs that are flawed, biased, discriminatory, inflammatory, unfair, or untruthful; and/or (ivv) adversely impacted by unforeseen defects, technical challenges, cybersecurity threats or material performance issues, the performance of our products, services and business, as well as our reputation, including as a result of ethical concerns, could suffer or we could incur liability resulting from the violation of laws or contracts to which we are a party or civil claims.

In addition to our proprietary AI Technologies, we use AI Technologies licensed from third parties in our technologies or internal business operations, and our ability to continue to use such technologies at the scale we need may be dependent on access to specific third-party software and infrastructure. We cannot control the availability or pricing of such third-party AI Technologies, especially in a highly competitive environment, and we may be unable to negotiate favorable economic terms with the applicable providers.providers or unable to control the data processing, security, or other practices of these AI Technologies. If any such third-party AI Technologies become incompatible with our solutions or unavailable for use, or if the providers of such models unfavorably change the terms on which their AI Technologies are offered or terminate their relationship with us, our solutions may become less appealing to our customers and our business will be harmed. In addition, to the extent any third-party AI Technologies are used as a hosted service, any disruption, outage, or loss of informationinformation, or mishandling of data through such hosted services could disrupt our operations or solutions, damage our reputation, cause a loss of confidence in our solutions, or result in legal claims or proceedings, for which we may be unable to recover damages from the affected provider.

In particular, we incorporate generative AI Technologies (i.e., AI Technologies that can produce and output new content, software code, data and information) into our services and internal business practices. There is a risk that generative AI Technologies could produce inaccurate or misleading content or other discriminatory or unexpected results or behaviors, such as hallucinatory behavior that can generate irrelevant, nonsensical, or factually incorrect results, all of which could harm our reputation, business, or customer relationships. While we take measures designateddesigned to ensure the accuracy of such AI-generated content, those measures may not always be successful, and in some cases, we may need to rely on end users to report such inaccuracies. In addition, we may experience difficulties in enforcing the intellectual property rights in output generated by generative AI Technologies. The United States Copyright Office has previously denied copyright protection for content generated by AI Technologies, and the United States Patent and Trademark Office has similarly stated that an AI tool cannot be an “inventor” of a patent, rendering it impossible to obtain patent protection for inventions created solely by AI Technologies.

We are also subject to the FCPA, the U.S. domestic bribery statute contained in 18 U.S.C. § 201, the U.S. Travel Act, and the UK Bribery Act 2010, and may be subject to other anti-bribery, anti-money laundering, and sanctions laws in countries in which we conduct activities or have employers and job seekers. The FCPA prohibits providing, offering, promising, or authorizing, directly or indirectly, anything of value to non-U.S. government officials, political parties, or political candidates for the purposes of obtaining or retaining business or securing any improper business advantage. The provisions of the Bribery Act extend beyond bribery of government officials and create offenses in relation to commercial bribery including private sector recipients. The provisions of the Bribery Act also create offenses for accepting bribes in addition to bribing another person. We face significant risks if we cannot comply with the FCPA, the Bribery Act and other applicable anti-corruption laws. We have implemented an anti-corruption compliance policy, but we cannot ensure that all of our employees, employers and job seekers, and agents, as well as those contractors to which we outsource certain of our business operations, will not take actions in violation of our policies or agreements and applicable law, for which we may be ultimately held responsible.

•we may be held liable for the unauthorized use of an account holder’s credit card or bank account number and required by card issuers or banks to return the funds at issue and pay a chargeback or return fee, and if our chargeback or return rate becomes excessive, credit card networks may also require us to pay fines or other fees and the California Department of BusinessFinancial OversightProtection and Innovation may require us to hold cash reserves;

Further, we may incur significant operating expenses as a result of ourany international expansion, and it may not be successful. We have limited experience with regulatory environments and market practices internationally, and we may not be able to penetrate or successfully operate in new markets. We also have more limited brand recognition in certain parts of the world, leading to delayed acceptance of our marketplace by international employers and job seekers. If we cannot continue to expand internationally and manage the complexity of our global operations successfully, our financial condition and operating results could be adversely affected.

From time to time, we may be subject to claims, lawsuits (including class actions), government investigations, arbitrations and other proceedings involving competition and antitrust, intellectual property, privacy (including claims that the collection or provision of certain information, including personal information, by us or by third parties with whom we interact breached laws or regulations relating to privacy or data protection), consumer protection, securities, tax, labor and employment, commercial disputes,disputes (including claims relating to our marketplace functionality), and other matters that could adversely affect our business operations and financial condition. The outcome of any legal proceeding, regardless of its merits, is inherently uncertain. Regardless of the merits, pending or future legal proceedings could result in a diversion of management’s attention and resources and reputational harm, and we may be required to incur significant expenses defending against these claims or pursuing claims against third parties to protect our rights. If we do not prevail in litigation, we could incur substantial liabilities. We may also determine in certain instances that a settlement may be a more cost-effective and efficient resolution for a dispute. Any applicable insurance policies may be inadequate or may not be available in the future on acceptable terms, or at all, and such policies may not cover all claims made against us.

ZipRecruiter is free to use for job seekers. Job seekers come to ZipRecruiter in search of their next opportunity. After establishing a profile, job seekers are able to apply to jobs with a single click. Our artificial intelligence-powered career advisor, Phil,platform curates jobs and proactivelyhelps sendsjob alertsseekers fordiscover new opportunities whereand theystand are a Great Match, which is a designation assigned by ZipRecruiter’s technologyout to indicate a high potential fit between a job seeker and a job.employers. As our matching technology learns more about job seekers’ preferences and attributes, our technology offers increasingly higher quality matches.matches between job seekers and employers.

For the year ended December 31, 2025, our revenue was $449.0 million and we had a net loss of $33.0 million and Adjusted EBITDA of $40.8 million. For the year ended December 31, 2024, our revenue was $474.0 million and we had a net loss of $12.9 million and Adjusted EBITDA of $78.0 million. For the year ended December 31, 2023, our revenue was $645.7 million and we generated net income of $49.1 million and Adjusted EBITDA of $175.3 million. Adjusted EBITDA is a financial measure not presented in accordance with GAAP. For a definition of Adjusted EBITDA, an explanation of our management’s use of this measure and a reconciliation of net income (loss) to Adjusted EBITDA, see the section titled “Key Operating Metrics and Non-GAAP Financial Measures.”

In the fourth quarter of the year ended December 31, 2024,2025, Revenue per Paid Employer remaineddecreased flat2% when compared to the fourth quarter of the year ended December 31, 2023.2024. Despite the current softness in hiring demand amidst the challenging economic climate,While we believe our products and services continued to improve and offered more value for employers of all sizessizes, year-over-year.we saw a 2% year-over-year decrease as hiring demand remains more muted.

We define Adjusted EBITDA as our net income (loss) before interest expense, other income (incomeexpense) expense,, net, income tax expense (benefit), and depreciation and amortization, adjusted to eliminate stock-based compensation expense. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA for a period by revenue for the same period.

The following table presents a reconciliation of net income (loss) to Adjusted EBITDA for each of the periods indicated:

The following tables present net income (loss) margin and Adjusted EBITDA margin for each of the periods indicated:

While our marketplace serves a wide variety of employers, all employers benefit from finding the right candidate quickly. We bring employers and job seekers together using industry-leading matching technology. This technology benefits from the billions of data points we gather as job seekers and employers interact, leading to better matches over time. As a result of our advancements with matching, we delivered over 40 million Great Match candidates in 2024, an increase of 6% over the prior year.

For job seekers, we operate like a personal recruiter, presenting stronghighly fitqualified potential candidates to employers before they have applied. Phil, our AI-powered career advisor, engages job seekers on their journey and provides technology that makes their job search and application process more efficient. Our ability to cost effectively grow the number of job seekers and increase their engagement in our marketplace is critical to strengthen our marketplace. We compete for job seekers on many fronts, including our ability to surface unique and attractive jobs, our ability to simplify the hiring process, the transparent feedback job seekers receive on the status of their applications and our trusted brand. We believe our offering to job seekers compares favorably versus alternatives due to the combination of our large and unique set of jobs to choose from, plus our proven matching technology that continues to get smarter over time. We believe that our unique product offering and investments in media campaigns focused on job seeker acquisition engagement are why we have been the highest#1 rated job seekersearch app on iOS and Android, and why we have seen increased momentum in organic traffic from job seekers. In 2024, installsAndroid for ourthe #1past ratednine job seeker app for iOS and Android grew by more than 25% year-over-year, and organic visits from job seekers grew by 30% over 2023.years1. We believe that this is a testament to our high aided brand awareness and superior job seeker products.

We have invested in research and development to improve our matching technology and deliver a high-quality experience to employers and job seekers. In 20242025 and 2023,2024, we spent $134.8$124.6 million and $141.8$134.8 million, respectively, or 28% and 22% of total revenue,revenue respectively,for both 2025 and 2024, on research and development. We believe the return on these investments will create operating leverage over time while continuing to drive top-line growth.

Our business is seasonal, reflecting typical behavior in hiring markets. Hiring activity tends to decelerate in the fourth quarter. DuringBeginning in the second half of 2022, we saw revenueobserved declines of 5% and 7% in the third and fourth quarters, respectively. We believe this decline wasrevenue primarily driven by a macroeconomic cooling in the hiring market. This trend continued throughout 2023 and1 2024,Based ason wejob continuedseeker app ratings, during the period of January 2017 to observeJanuary employers2026 moderatingfrom hiringAppFollow plansfor ZipRecruiter, Glassdoor, Indeed, LinkedIn, and reducing recruitment budgets in response to economic uncertainty. Additionally, with those currently employed leaving their jobs at a low rate, the reduced churn among employees further drove down hiring levels. This has resulted in atypical seasonal hiring patterns, with online hiring demand declining throughout 2023 and 2024.Monster.

We generate revenue primarily from fees paid by employers to post and distribute jobs in our marketplace, as well as multiple sites managed by Job Distribution Partners, which are third-party sites who have a relationship with us and advertise from our marketplace, and includes job boards, newspaper classifieds, search engines, social networks, talent communities and resume services.

Our upsell services complement or expand visibility to job posting plans and are typically sold on a subscription basis. Upsell services revenue is recognized ratably over the term of the agreement beginning on the date the upsell services are made available to the customer. Additionally, upsell services include job posting enhancements which are applied to individual job postings. Such services enhance job postings by providing customers with a temporary boost in the prominence of their job postings, expanding visibility to job postings by inviting stronghighly fitqualified potential candidates to apply to the job, or highlighting key attributes of job postings to make them stand out to job seekers. Revenue from job posting enhancements is recognized as the customer uses the enhancements on its job postings.

Performance-based revenue is recognized when a candidate clicks on or applies to a job distributed by ZipRecruiter on behalf of a customer. For performance-based revenue, our customers pay an amount per click or per job application usually capped at a contractual maximum per job recruitment campaign.

SalesMarketing and advertising expense includes advertising, online lead generation, customer and industry events, and candidate acquisition. Other sales and marketing expense consists of personnel-related costs (including salaries, sales commissions, bonuses, benefits, and stock-based compensation) for our sales and marketing employees, marketing activities, and related allocated overhead costs. Marketing activities include advertising, online lead generation, customer and industry events, and candidate acquisition. We allocate a portion of overhead costs, such as rent, IT costs, supplies, and depreciation and amortization, to sales and marketing expense based on headcount. Sales and marketing costs are expensed as incurred.

We expect that sales and marketing expenses will increasedecrease or decreaseincrease on an absolute dollar basis as we adjust our highly variable sales and marketing spend budget throughout economic cycles to reallocateconserve or conservereallocate spend where we see the greatest returns. Additionally, sales and marketing expenses may vary from period to period as a percentage of revenue for the foreseeable future as we constantly measure the expected returns of specific sales and marketing initiatives and adjust spend levels up or down accordingly. This discipline has been a key aspect of our strong financial performance through a wide range of macroeconomic conditions. We expect that these expenses will continue to be our largest operating expense category for the foreseeable future as we continue to expandinvest onin our sales and marketing efforts over time.

Research and development expense consists of personnel-related costs (including salaries, bonuses, benefits, and stock-based compensation) for our research and development employees, amortization of capitalized software costs associated with the development of internal databases, candidate insights, and reporting that supports our marketplace technology and the cost of certain third-party service providers. We allocate a portion of overhead costs, such as rent, IT costs, supplies, and depreciation and amortization, to research and development expenses based on headcount. Research and development costs, other than software development costs qualifying for capitalization, are expensed as incurred.

Other income (expense), net consists primarily of interest income recognized on cash, cash equivalents and marketable securities, gains and losses from foreign currency exchange transactions, and realized gains and losses recognized on sales of available-for-sale debt securities. We have foreign currency exposure primarily related to personnel-related expenses that are denominated in currencies other than the U.S. Dollar, principally the Canadian Dollar, British Pound and the Israeli New Shekel. Other income (expense), net also includes sublease income which consists of income earned from noncancellable sublease agreements related to some of our office facilities.

We are subject to federal and state income taxes in the United States, as well as several international jurisdictions. The effective tax rate for the year ended December 31, 20242025 differed from the U.S. federal statutory rate of 21% primarily due to researchcertain andnon-deductible developmentstock based compensation expenses, certain executive compensation expenses subject to limitation, changes in unrecognized tax credits,benefits, partially offset by state taxes,and valuation allowances on certain tax creditcarryforwards, partially offset by research and lossdevelopment carryforwards,tax and non-deductible expenses such as limitations on the amount of deductible executive compensation and certain stock based compensation expenses.credits.

____________ (1)Revenue is comprised as follows:

Revenue decreased by $171.7$25.0 million, or 27%,5%, for the year ended December 31, 20242025 compared to the year ended December 31, 20232024. reflectingWith those currently employed continuing to leave their jobs at a low rate during the year ended December 31, 2025, hiring levels remained lower number of Quarterly Paid Employers in our marketplace primarily duecompared to the laboryear marketended continuingDecember to31, be2024, impactedreflecting by high interest ratesuncertainty in the current period which posed challenges to many businesses.economy. Subscription revenue decreased by $138.6$24.7 million, or 27%,7%, and performance-based revenue decreased by $33.2 million, or 24%,slightly for the sameyear period.ended December 31, 2025 compared to the year ended December 31, 2024. While we believe our products and services continued to improve, providing more value for employers of all sizes by offering solutions with the bestleading matching technology to help employers identify and recruit standout candidates, we saw a decline in employer spending on our marketplace products and services during the year ended December 31, 2024.2025. We believe the decline reflects the prevailing softness in hiring demand amidst the challenging macroeconomic conditions.

Cost of revenue decreased by $14.2$1.9 million, or 22%,4%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, primarily due to a decrease of $4.0$2.1 million in creditpartner cardrevenue processingshare fees,and a decrease of $3.5$1.0 million in IT overhead costs, partially offset by an increase of $1.8 million in job distribution costs from performance-based revenue, a decrease of $2.8 million in third-party hosting fees, and a decrease of $2.7 million in partner revenue share.revenue. Gross margin was 89% andfor 90% forboth the years ended December 31, 20242025 and December 31, 2023, respectively,2024, reflecting our continued commitment to operational efficiencies and maintaining costs proportionate to revenue.

Research and development expenses decreased by $7.0$10.3 million, or 5%,8%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, primarily driven by one-time restructuring costs of $3.2 million related to our May 2023 reduction in force incurred during the year ended December 31, 2023, as well as a $2.3 million decrease in personnel-related costs and a $1.7$10.9 million decrease in stock-based compensation expense for our research and development employees corresponding with lower headcount in the current-year period.period Researchas and development expenseswell as a percentagelower grant date fair value of revenueequity increasedawards 6recognized percentageas pointsexpense forin the yearcurrent ended December 31, 2024 compared to the year ended December 31, 2023, primarily driven by lower revenue. We expect to continue to invest in research and development activities, and we expect this expense may vary as a percentage of total revenue for the foreseeable future.period.

Total other income (expense), net, decreasedincreased by $1.1$3.5 million, or 13%,45%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023,2024, primarily driven by a $2.8 million increase in interest income earned on both our marketable securities and cash equivalents, partially offset by a $0.8 million increase in losses from foreign currency exchange transactions and a $0.5$4.1 million decrease related to sublease income recognizedaccretion duringfor theour yearmarketable endedsecurities Decemberpurchased 31,at 2023a with no corresponding income recognized during the year ended December 31, 2024.discount.

Income tax expense decreased by $15.1$4.0 million, or 70%,63%, for the year ended December 31, 20242025 compared to the year ended December 31, 2023.2024. The decrease in income tax expense is primarily due to the impact of a decrease in pre-tax income on federal and state taxes andpartially aoffset reductionby an increase in executive compensation limitations partly offset byand a decrease in tax benefits from operating losses and research and development tax credits, net of valuation allowances, and a decrease in benefits from foreign taxes related to a reduction in our Israeli subsidiary’s statutory tax rate for years 2020 through 2023.allowances.

Our effective tax rate in the years ended December 31, 20242025 and 20232024 was (97.87.8)% and 30.4%,(97.8)%, respectively. Our effective tax rate for the year ended December 31, 2025 differed from the U.S. federal statutory rate of 21% primarily due to certain non-deductible stock based compensation expenses, certain executive compensation expenses subject to limitation, changes in unrecognized tax benefits, and valuation allowances on certain tax carryforwards, partially offset by research and development tax credits. Our effective tax rate for the year ended December 31, 2024 differed from the U.S. federal statutory rate of 21% primarily due to research and development tax credits, partially offset by state taxes, valuation allowances on certain tax credit and loss carryforwards, and non-deductible expenses such as limitations on the amount of deductible executive compensation and certain stock-based compensation expenses. Our effective tax rate for the year ended December 31, 2023 differed from the U.S. federal statutory rate of 21% primarily due to state taxes, state valuation allowances on certain tax credit carryforwards, and non-deductible expenses such as limitations on the amount of deductible executive compensation partially offset by research and development tax credits and a reduction in our Israeli subsidiary’s statutory tax rate for years 2020 through 2023.

At any time prior to January 15, 2030, we have the option, at our sole discretion, to redeem all or a portion of our senior unsecured notes subject to the payment of certain premiums, make-whole provisions, and accrued and unpaid interest. In addition, we may, at any time and from time to time, seek to retire or purchase our outstanding debt through open-market purchases, privately negotiated transactions, tender offers, exchange offers or otherwise, which, if completed, could involve the use of cash, in amounts that may be material, and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors that could materially affect our liquidity. Upon the occurrence of a change of control triggering event, we must offer to repurchase the senior unsecured notes at a repurchase price equal to 101% of the aggregate principal amount to be repurchased, and any accrued and unpaid interest.

During the year ended December 31, 2024,2025, we continued investing primarily in highly rated debt securities and money market mutual funds to manage our excess cash reserves. The primary objectives in investing our excess cash reserves are to preserve capital, provide sufficient liquidity to satisfy both operational cash flow requirements and potential strategic investment opportunities, and to obtain a reasonable or market rate of return on investments. We consider all of our investments as available for use in current operations, including those with maturity dates beyond one year, and therefore classify these securities within current assets in our Consolidated Balance Sheets.

Upsell services also include job posting enhancements which are applied to individual job postings. Such services enhance job postings by providing customers with a temporary boost in the prominence of their open jobs, expanding visibility to job postings by inviting stronghighly fitqualified potential candidates to apply to the job, or highlighting key attributes of job postings to make them stand out to job seekers. Individual job posting enhancements may be purchased by a customer when needed, or in recurring monthly prepaid bundles to complement their job posting subscription plan, and are billed in advance of use. Typically these prepaid bundles can be used over a period ranging from one to twelve months. Revenue from job posting enhancements is recognized as the customer uses the enhancement on their job postings. Unused prepaid job posting enhancements are not refundable, and we recognize revenue for the estimated portion of prepaid job posting enhancements that are expected to expire unused, or breakage, based on estimates considering historical breakage levels for upsell services. Breakage is recognized as revenue in proportion to the pattern of actual usage by customers.

Performance-based revenue consists of customers who pay on a per click by job applicant or per job application basis for the job postings they wish to distribute through our software. Customers pay an amount per click or per application that is usually capped at a contractual maximum per recruitment campaign, with campaigns typically lasting from one to three months. Customers on this pricing model do not have access to our applicant tracking software for subscription customers though they may purchase resume database subscription plans separately. Customers that use performance-based revenue plans are typically companies with consistent hiring needs and sophisticated recruitment campaigns where they manage incoming applications and job postings on their own applicant tracking systems.

Performance-based revenue is typically billed monthly, in arrears, and revenue is recognized as job applicants click on or apply to the distributed job postings, up to the contractual maximum per recruitment campaign.

Compensation expense related to stock-based awards is measured and recognized in the financial statements based on the fair value of the awards granted. We estimate the fair value of employee stock-based compensation awards on the grant date and recognize forfeitures as they occur. TheWe estimate the fair value of restricted stock units, or RSUs, is estimated based on the fair value of our common stock. The fair value of our common stock is determined based on the New York Stock Exchange closing price on the date prior to the date of grant. The fair value of each option award and employee stock purchase right associated with our Employee Stock Purchase Plan is estimated on the grant date using the Black-Scholes option pricing model. The Black-Scholes option pricing model requires us to make certain assumptions including the fair value of the underlying common stock, the expected term, the expected volatility, the risk-free interest rate, and the dividend yield.

We record valuation allowances against our deferred tax assets, when necessary. Realization of deferred tax assets is dependent upon future taxable earnings and is therefore uncertain. At least quarterly, we assess the likelihood that our deferred tax asset balance will be realized against future taxable income. To the extent we believe that realization is not likely, we establish a valuation allowance against our net deferred tax asset, which increases our income tax expense in the period when such determination is made. During the year ended December 31, 2024,2025, we recorded an incremental valuation allowance of $3.9$1.4 million against theour deferred tax assets associatedin withjurisdictions carriedin forward California Research and Development Credits aswhich we believe that it is more likely than not that we will not generate sufficient California sourced taxable income in future years to utilize thatthe corresponding deferred tax asset and additionally established a valuation allowance against certain historic operating losses of foreign entities.asset.

We have incurred net losses in the past, anticipate increasing our operating expenses in the future, and may not regain or sustain profitability.

While we earned net income of $43.4 million and $38.7 million for the three and six months ended June 30, 2026, respectively, as well as $49.1 million and $61.5 million for the years ended December 31, 2023 and 2022, respectively, we have also incurred significant net losses in subsequentother periods, including a net loss of $4.7 million for the three months ended March 31, 2026 as well as a net loss of $33.0 million and $12.9 million for the years ended December 31, 2025 and 2024, respectively. As of MarchJune 31,30, 2026, we had an accumulated deficit of $83.1$39.7 million. Additionally, we expect to make significant future expenditures related to the development and expansion of our business, including investing in our technology to improve our marketplace and investing in sales and marketing channels to enhance our brand promotion efforts. These efforts may prove more expensive than we currently anticipate, and we may not succeed in increasing our revenue sufficiently to offset these higher expenses. If our revenue declines or fails to grow at a rate faster than increases in our operating expenses, we will not be able to regain or maintain profitability in future periods. As a result, we may continue to generate losses. We cannot ensure that we will achieve profitability in the future or that we can sustain profitability.

Data security breaches and other data privacy and security incidents may also result from non-technical means, for example, through human error. Any such security compromise could result in a violation of applicable data privacy, security, breach notification and other laws, regulatory or other governmental investigations, enforcement actions, litigation (including class action litigation), and legal and financial exposure, including potential contractual liability. We may need to expend significant resources to protect against, and to address issues created by, security breaches and other privacy and security incidents. These liabilities may exceed the amounts covered by our insurance or our insurance coverage may not extend to or be adequate for liabilities actually incurred, or our insurance may not continue to be available to us on economically reasonable terms, or at all. Any such compromise could also result in damage to our reputation, a loss of confidence in our security measures, and an adverse impact on our business.

Several U.S. and European jurisdictions currently or will soon regulate specific uses of AI Technologies. For example, New York City currently regulates the use of automated employment decision tools by employers and employment agencies; Utah regulates disclosures for the use of generative AI Technologies; Illinois regulates AI Technologies in employment decision-making process; Colorado regulates the use of automated decision-making technologies (ADMT) in consequential decisions, and Texas prohibits specific AI Technologies use cases (including those developed or deployed with the intent of unlawfully discriminating against a protected class under federal or state law). Colorado is expected to soon regulate the use of high-risk AI Technologies (which includes an AI system that is a substantial factor in making a decision that has a significant effect on employment or employment opportunities), although implementation has been postponed and amendments are expected to precede implementation. California has also enacted several new AI laws that further regulate use of AI Technologies and provide consumers with additional protections around companies’ use of AI Technologies, such as requiring companies to disclose certain uses of AI Technologies and the types of data used to train such AI models. Relatedly, various state laws including the CCPA regulate the use of automated decision making technology that results in legal or similarly significant effects on individuals, and provide rights to individuals with respect to that automated decision making.

In the EU, the Artificial Intelligence Act, or the EU AI Act, entered into force in August 2024. The EU AI Act seeks to create a comprehensive legal framework for the regulation of AI systems across the EU. TheIn majorityJuly 2026, the Digital Omnibus on AI entered into force, deferring obligations for high-risk AI systems to December 2027 (for high-risk AI systems described in Annex III, including those related to recruitment) and August 2028 (for high-risk AI systems described in Annex I, including those embedded in regulated products). Transparency obligations for providers and deployers of obligations under the EUcertain AI Actsystems, areincluding expectedgenerative toand takeinteractive AI systems and deepfakes, took effect in August 2026. Once fully applicable, the EU AI Act will have a material impact on the way AI is regulated in the EU, including, for certain types of AI systems, requirements around transparency, conformity assessments and monitoring, risk assessments, human oversight, security, accuracy, general purpose AI and foundation models, and fines for breach of up to 7% of worldwide annual turnover. Failure to comply with such laws or regulations could subject us to legal or regulatory liability. Further, the cost to comply with such laws or regulations could be significant and would increase our operating expenses, which could adversely affect our business, financial condition and results of operations.

From time to time, we may be subject to claims, lawsuits (including class actions), government investigations, arbitrations and other proceedings involving competition and antitrust, intellectual property, privacy (including claims that the collection or provision of certain information, including personal information, by us or by third parties with whom we interact breached laws or regulations relating to privacy or data protection), consumer protection, securities, tax, labor and employment, commercial disputes (including claims relating to our marketplace functionality), and other matters that could adversely affect our business operations and financial condition. For example, in June 2026, a purported stockholder of the Company filed a complaint against certain current and former directors of the Company and the Company, generally alleging breaches of the directors’ fiduciary duties in connection with the Company’s share repurchase program authorized by the Company’s board of directors. The outcome of any legal proceeding, regardless of its merits, is inherently uncertain. Regardless of the merits, pending or future legal proceedings could result in a diversion of management’s attention and resources and reputational harm, and we may be required to incur significant expenses defending against these claims or pursuing claims against third parties to protect our rights. If we do not prevail in litigation, we could incur substantial liabilities. We may also determine in certain instances that a settlement may be a more cost-effective and efficient resolution for a dispute. Any applicable insurance policies may be inadequate or may not be available in the future on acceptable terms, or at all, and such policies may not cover all claims made against us.

We had $550.0$255.4 million of indebtedness (excluding intercompany indebtedness) and $287.7 million available under our credit facility as of March 31, 2026. Our credit facility expired on its maturity date of AprilJune 30, 2026, and we elected not to renew it.2026. Our indebtedness could have important consequences, including:

In addition, the indenture governing the $550.0remaining $255.4 million aggregate principal amount of our outstanding senior unsecured notes that we issued in January 2022 contains restrictive covenants that limit our ability to engage in activities that may be in our long-term best interest. Our failure to comply with those covenants could result in an event of default under the indenture governing the senior unsecured notes which, if not cured or waived, could result in the acceleration of substantially all of our indebtedness.

Our Class B common stock has twenty votes per share and our Class A common stock has one vote per share. As of MarchJune 31,30, 2026, Ian Siegel, our chief executive officer and the sole holder of our outstanding Class B common stock, beneficially owned approximately 16.0%15.8% of our total outstanding common stock as a class and held approximately 79.2%79.0% of the voting power of our total outstanding common stock as a class. Because of the twenty-to-one voting ratio between our Class B and Class A common stock, the sole holder of our Class B common stock controls a substantial majority of the combined voting power of our common stock and therefore is able to control all matters submitted to our stockholders for approval until the earliest of (1) the first business day falling on or after 180 days after the date on which Mr. Siegel beneficially owns less than 4,000,000 shares of Class B common stock, (2) the date which is (a) 90 days after the date of death or disability of Mr. Siegel or (b) such later date, not to exceed a total period of 180 days after the date of death or disability of Mr. Siegel, as may be approved prior to the date that is 90 days after the date of death or disability of Mr. Siegel by a majority of our independent directors then in office, and (3) the first business day falling on or after the date on which Mr. Siegel elects to convert all then-outstanding shares of Class B common stock into shares of Class A common stock. This concentrated control limits or precludes your ability to influence corporate matters for the foreseeable future, including the election of directors, amendments of our organizational documents, and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transaction requiring stockholder approval. In addition, this may prevent or discourage unsolicited acquisition proposals or offers for our capital stock that you may feel are in your best interest as one of our stockholders.

As of MarchJune 31,30, 2026, the board of directors had authorized us to repurchase up to $750.0 million of our common stock through open market or privately negotiated transactions, block purchases, or pursuant to one or more Rule 10b5-1 plans, in compliance with applicable securities laws and other legal requirements. The timing and actual number of shares repurchased will depend on a variety of factors including price, market conditions, corporate and regulatory requirements, and other investment opportunities. Approximately $111.8 million remains available for future repurchases under our $750.0 million share repurchase program as of MarchJune 31,30, 2026.

For the three months ended MarchJune 31,30, 2026, our revenue was $107.5$118.1 million and we had agenerated net lossincome of $4.7$43.4 million and Adjusted EBITDA of $9.7$14.6 million. For the three months ended MarchJune 31,30, 2025, our revenue was $110.1$112.2 million, and we had a net loss of $12.8$9.5 million and Adjusted EBITDA of $5.9$9.3 million. For the six months ended June 30, 2026, our revenue was $225.6 million and we generated net income of $38.7 million and Adjusted EBITDA of $24.3 million. For the six months ended June 30, 2025, our revenue was $222.3 million, and we had a net loss of $22.3 million and Adjusted EBITDA of $15.3 million. Adjusted EBITDA is a financial measure not presented in accordance with GAAP. For a definition of Adjusted EBITDA, an explanation of our management’s use of this measure and a reconciliation of net income (loss) to Adjusted EBITDA, see the section titled “Key Operating Metrics and Non-GAAP Financial Measures.”

In the quarter ended MarchJune 31,30, 2026, Revenue per Paid Employer decreased when compared to the quarter ended DecemberMarch 31, 2025.2026. WhileWe weexperienced believean ourinflux productsof new and servicesreturning continuedPaid toEmployers, improvesome andof offeredwhich moreonly valuecontributed revenue for employersa portion of allthe sizes,quarter, wedriving saw a sequential decline indown Revenue per Paid Employer consistent with historical seasonality as new and returning Paid Employers ramped up hiring over the course ofin the quarter ended MarchJune 31,30, 2026, following the holiday slowdown.2026.

We define Adjusted EBITDA as our net income (loss) before interest expense, gain on debt extinguishment, other income (expense), net, income tax expense (benefit), and depreciation and amortization, adjusted to eliminate stock-based compensation expense. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA for a period by revenue for the same period.

The following table presents a reconciliation of net income (loss) to Adjusted EBITDA for each of the periods indicated:

The following tables present net income (loss) margin and Adjusted EBITDA margin for each of the periods indicated:

The labor market remains subdued, with employerslower reducing theirhiring demand forfrom hiring,employers, at least in part due to effects of a variety of global business and macroeconomic factors, including inflationary pressures, elevated borrowing costs, cybersecurity incidents, changes in laws, regulations and administrative policy, including those that impact trade agreements and tariffs, and the impacts of the wars in Ukraine and the Middle East. Further, with those currently employed continuing to leave their jobs at a low rate during the three months ended March 31, 2026, hiring levels remained lower compared to the three months ended March 31, 2025. In the three months ended March 31, 2026, we delivered $107.5 million in revenue, a 2% decrease compared to the three months ended March 31, 2025. Despite the continued uncertainty in the labor market, we had a similarhigher number of Quarterly Paid Employers in our marketplace induring the three monthsquarter ended MarchJune 31,30, 2026 compared to the quarter ended June 30, 2025. Additionally, in the three and six months ended MarchJune 31,30, 2025.2026, we delivered $118.1 million and $225.6 million in revenue, respectively, a 5% and 1% increase compared to the three and six months ended June 30, 2025, respectively.

Total Other Income (Expense), Net

We are subject to federal and state income taxes in the United States, as well as several international jurisdictions. The effective tax rate for the three and six months ended MarchJune 31,30, 2026 differed from the U.S. federal statutory rate of 21% primarily due to tax detriments relating to the settlement of restricted stock units, certain non-deductible expenses including limitations on the amount of deductible officer compensation, and state taxes, partially offset by net tax benefits from research and development tax credits. The effective tax rate for the three and six months ended June 30, 2025 differed from the U.S. federal statutory rate of 21% primarily due to tax detriments relating to the settlement of restricted stock units, certain non-deductible expenses including limitations on the amount of deductible officer compensation, state taxes, and net tax benefits from research and development tax credits.

____________ (1)Revenue was comprised as follows:

Comparison of the Three and Six Months Ended MarchJune 31,30, 2026 and 2025

Sales and marketing expenses decreased by $3.5$2.6 million, or 6%,2%, for the threesix months ended MarchJune 31,30, 2026 compared to the threesix months ended MarchJune 31,30, 2025. The decrease was primarily driven by a $2.7$4.2 million decrease in personnel-related costs for our sales and amarketing $1.0employees, millioncorresponding decreasewith lower headcount in stock-basedthe current-year period. Stock-based compensation expense for our sales and marketing employees also decreased by $2.1 million corresponding with lower headcount in the current-year period as well as a lower grant date fair value of equity awards recognized as expense in the current period.period as well as lower headcount. The decrease was partially offset by a $1.2$4.2 million increase in marketing and advertising spend as we deployed marketing dollars towards campaigns we believe will drive a strong return on investment.

Research and development expenses decreased by $7.2$5.7 million, or 22%,18%, for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, primarily driven by a $3.8$2.7 million decrease in stock-based compensation expense for our research and development employees corresponding with lower headcount in the current-year period as well as a lower grant date fair value of equity awards recognized as expense in the current period. Personnel-related costs for our research and development employees also decreased by $3.0$2.2 million, primarily driven by lower headcount.

General and administrative expenses decreased by $2.3$0.7 million, or 13%,4%, for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, primarily driven by a $1.3$1.4 million decrease in stock-based compensation expense for our general and administrative employees corresponding with a lower grant date fair value of equity awards recognized as expense in the current period and lower headcount in the current period. Personnel-related costs for our general and administrative employees also decreased by $1.0 million, primarily driven by lower headcount.

Total other income (expense), net increased by $2.0$58.2 million, or 98%,million for the three months ended MarchJune 31,30, 2026 compared to the three months ended MarchJune 31,30, 2025, primarily driven by a $1.2$59.3 million gain on debt extinguishment recognized from the repurchase of a portion of our outstanding senior unsecured notes. The increase was partially offset by a $1.4 million decrease related to income accretion for our marketable securities purchased at a discount and a $0.4 million decrease in interest income earned on both our marketable securities and cash equivalents.discount.

As of MarchJune 31,30, 2026, we had cash, cash equivalents,equivalents and marketable securities totaling $393.5$173.8 million and restricted cash of $2.3 million. We have financed our operations and capital expenditures primarily through cash generated from operations, sales of shares of common and preferred stock and from our senior unsecured notes, bank loans, and convertible notes.

In April 2021, we entered into a $250.0 million credit facility agreement with a syndicate of banks. In July 2024, we entered into a supplement to the credit facility agreement which increased the aggregate revolving commitments available under the credit facility from $250.0 million to $290.0 million. We had no amounts outstanding under the credit facility and were in compliance with our debt covenants as of March 31, 2026. The credit facility expired on its maturity date of April 30, 2026, and we elected not to renew it. At the time of expiration, there were no outstanding borrowings under the credit facility. Letters of credit previously issued against the credit facility remain outstanding and are cash collateralized by a $2.3 million restricted deposit.

On January 12, 2022, we issued an aggregate principal amount of $550.0 million senior unsecured notes due 20302030, or the Notes, in a private placement. The senior unsecured notesNotes were issued pursuant to an indenture dated as of January 12, 2022, or the Indenture. Pursuant to the Indenture, the senior unsecured notesNotes will mature on January 15, 2030 and bear interest at a rate of 5% per year. Interest on the senior unsecured notesNotes is payable semi-annually in arrears on January 15 and July 15 of each year.

At any time prior to January 15, 2030, we have the option, at our sole discretion, to redeem all or a portion of ourthe senior unsecured notesNotes subject to the payment of certain premiums, make-whole provisions, and accrued and unpaid interest. In addition, we may, at any time and from time to time, seek to retire or purchase our outstanding debt through open-market purchases, privately negotiated transactions, tender offers, exchange offers or otherwise, which, if completed, could involve the use of cash, in amounts that may be material, and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors that could materially affect our liquidity. Upon the occurrence of a change of control triggering event, we must offer to repurchase the senior unsecured notesNotes at a repurchase price equal to 101% of the aggregate principal amount to be repurchased, and any accrued and unpaid interest.

For more information on the senior unsecured notes,Notes, please see Note 11 – Debt to our audited consolidated financial statements in the 2025 Form 10-K.

During the threesix months ended MarchJune 31,30, 2026, we repurchased 3.5 million shares of our Class A common stock for an aggregate purchase price of $9.4 million under our share repurchase program through open market purchases.

Approximately $111.8 million remains available for future repurchases of our common stock under our share repurchase program as of MarchJune 31,30, 2026. For more information, see Note 9 – Share Repurchase Program to our condensed consolidated financial statements included in this report.

As of MarchJune 31,30, 2026, we held $253.3$105.4 million in total investments, consisting of money market mutual funds and available-for-sale debt securities. These investments are included within cash and cash equivalents and marketable securities within our condensed consolidated balance sheets. ForDuring morethe information,three seemonths Noteended 5June –30, Financial2026, Instrumentsa significant amount of our investments held at March 31, 2026 matured to fund the repurchases of the Notes. Our remaining investments consist of money market mutual funds and available-for-sale debt securities, which are included within cash and cash equivalents and marketable securities within our condensed consolidated financialbalance statements included in this report.sheets.

For the threesix months ended MarchJune 31,30, 2026, cash usedprovided inby operating activities was $3.5$11.9 million resulting from our net lossincome of $4.7$38.7 million, adjusted by non-cash chargesitems of $10.8$20.1 million and a net decrease of $9.6$6.7 million in our operating assets and liabilities. The non-cash chargesitems primarily resulted from $8.4a $59.3 million gain on debt extinguishment and $1.7 million in amortization and accretion of marketable securities, partially offset by $15.9 million related to the change in our deferred income taxes primarily driven by the utilization of carried forward tax losses resulting from the taxable gain on debt extinguishment, $15.7 million for stock-based compensation expense, $2.9$5.9 million pertaining to amortization of intangible assets and depreciation, and $0.5$1.0 million pertaining to non-cash lease expense, partially offset by $1.1 million in amortization and accretion of marketable securities and $0.9 million related to the change in our deferred income taxes.expense. The decrease of $9.6$6.7 million related to changes in our operating assets and liabilities was primarily driven by a $6.8$7.0 million decrease in accrued interest, a $5.4$1.5 million decreaseincrease in ourother assets, a $1.3 million increase in accounts payable and accrued expenses and other liabilities,receivable, a $0.6$1.2 million decrease in our operating lease liabilities, and a $0.1$1.2 million increase in prepaid expenses and other assets, partially offset by a $1.4$3.4 million decreaseincrease in our accounts receivable,payable and accrued expenses and other liabilities, a $0.9$1.3 million increase in deferred revenue, and a $0.7 million decrease in other assets, and a $0.3 million decrease in deferred commissions.

For the threesix months ended MarchJune 31,30, 2025, cash usedprovided inby operating activities was $9.9$0.6 million resulting from our net loss of $12.8$22.3 million, adjusted by non-cash charges of $12.8$24.0 million and a net decrease of $9.9$1.0 million in our operating assets and liabilities. The non-cash charges primarily resulted from $14.6$27.2 million for stock-based compensation expense, $3.0$6.4 million pertaining to amortization of intangible assets and depreciation, and $1.0$2.0 million pertaining to non-cash lease expense, partially offset by $4.6$9.2 million related to the change in our deferred tax assets driven by our current year capitalization of research costs from a tax perspective and $2.3$4.1 million in amortization and accretion of marketable securities. The decrease of $9.9$1.0 million related to changes in our operating assets and liabilities was primarily driven by a $6.9$2.8 million increase in accounts receivable and a $2.1 million decrease in accrued interest associated with our senioroperating unsecuredlease notes,liabilities, partially offset by a $1.9 million decreaseincrease in our accounts payable and accrued expenses and other liabilities, a $1.7 million increase in accounts receivable, and a $1.4 million decrease in our operating lease liabilities, partially offset by a $0.9 million increase in deferred revenuerevenue, a $0.7 million decrease in other assets, and a $0.5$0.4 million decrease in deferred commissions.

For the threesix months ended MarchJune 31,30, 2026, cash provided by investing activities was $76.7$173.4 million resulting from $140.5$239.3 million received from paydowns, maturities and redemptions of marketable securities and $1.3 million received from sales of marketable securities, partially offset by $62.9 million used in purchases of marketable securities and $2.1$3.9 million capitalized for software development costs.

For the threesix months ended MarchJune 31,30, 2025, cash provided by investing activities was $39.1$68.5 million resulting from $187.6$342.2 million received from paydowns, maturities and redemptions of marketable securities and $1.0 million received from sales of marketable securities, partially offset by $146.7$270.1 million used in purchases of marketable securities and $2.6$4.0 million capitalized for software development costs.

For the threesix months ended MarchJune 31,30, 2026, cash used in financing activities was $10.3$241.3 million which consisted of $229.7 million for the repurchases of the Notes, $9.5 million used for the repurchase of common stockstock, and $1.1$2.4 million for the net settlement of taxes on equity awards, partially offset by $0.3 million of proceeds from the exercise of stock options.

For the threesix months ended MarchJune 31,30, 2025, cash used in financing activities was $26.5$84.1 million which consisted of $27.5$84.1 million used for the repurchase of common stock and $2.2$4.1 million for the net settlement of taxes on equity awards, partially offset by $2.4 million of proceeds from the exercise of stock options and $1.7 million of proceeds from the issuance of stock under the employee stock purchase plan, and $1.5 million of proceeds from the exercise of stock options.plan.

See the 2025 Form 10-K for our future minimum commitments related to certain software service agreements. Through MarchJune 31,30, 2026, we did not have any relationships with unconsolidated organizations or financial partnerships, such as structured finance or special purpose entities that have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.