ZipRecruiter Inc. (NYSE: ZIP) cited “one of the slowest hiring markets in recent memory” and top-line headwinds in 2023 as challenges for fourth-quarter and full-year earnings. Fourth-quarter revenue at the jobs website operator fell 35.4% to $135.92 million.

“Although many macroeconomic forecasts are optimistic about the US economy managing a ‘soft landing’ without a recession in 2024, we remain nimble and prepared to adapt to a wide range of economic scenarios,” the Santa Monica, California-based company said in a letter to shareholders. “Our ability to adapt quickly amidst uncertainty is built upon our strong financial foundation, defined by both a historical track record of profitability and a healthy balance sheet.”

The number of quarterly paid employers fell 35% year over year to 70,700 at the end of the fourth quarter, primarily reflecting weakness among small to midsize businesses, which comprise the vast majority of ZipRecruiter’s paid employees. Revenue per paid employer also edged down 1% to $1,922.

“Despite the impact on employer hiring demand, our cohort trends remained intact: Employers across annual cohorts continue to spend more over time,” the shareholder letter states. “However, the more difficult hiring environment in 2023 did slow down the rate of growth in average monthly revenue per paid employer among prior cohorts. We see these disruptions to the long-term cohort dynamics as temporary, driven by the unique slowdown in hiring particularly among larger enterprises. Over the long term, we continue to believe that there is meaningful opportunity to grow revenue from these larger customers.”

Guidance

ZipRecruiter noted the macroeconomic backdrop remains uncertain, but compared to prior quarters, there is more positive consensus among macroeconomic forecasters around a smoother transition back to a more typical economic environment. “Therefore, we remain prepared for a wide range of outcomes in 2024,” it stated.

First-quarter 2024 revenue guidance is $120 million, representing a 35% decline year over year at the midpoint.

Share price

Shares in ZipRecruiter were down 7.47% to $12.76 as of 11:23 a.m. Eastern time today; they were 24.25% above their 52-week low, according to FT.com.