ZipRecruiter (NYSE: ZIP) reported third-quarter revenue fell 24.8% year over year to $117.1 million as it continues to navigate a protracted labor market downturn. Gross margin also decreased slightly at the job aggregator, which ranks as the sixth-largest online job advertising firm.

“While by several measures this is one of the more prolonged downturns in hiring activity, we are confident in the long-term health of the US labor market and see the end of the ‘Great Stay’ as a future tailwind,” CEO Ian Siegel said in a press release. “Navigating the ups and downs of the labor market is a reality of our business. Our playbook has proven effective during this period, as we are able to invest in product and technology while maintaining financial strength.”

ZipRecruiter announced results after close of market on Nov. 6.

The number of quarterly paid employers fell 27% year over year in the third quarter to 65,200. The company noted the decline is primarily reflective of reduced demand from small and midsize businesses due to continued uncertainty and volatility in the labor market. The quarterly paid employers metric includes all actively recruiting employers (or entities acting on behalf of employers) on a paying subscription plan or performance marketing campaign for at least one day in the quarter.

Revenue per paid employer was $1,795 in the third quarter, up 3% year over year. The increase was primarily due to the slight mix shift from subscription revenue to performance revenue, where performance-based revenue represented 22% of revenue compared to 21% in the year-ago quarter.

The company also announced that its board of directors has authorized a $100 million increase to its share repurchase program, bringing the total size of the repurchase program to $650 million.

In addition, ZipRecruiter promoted Megan Allen to executive VP, chief product officer. Allen joined the company in August 2017 and most recently served as senior VP, product. This year, Allen led key product initiatives such as ZipIntro and the next generation of ZipRecuiter’s résumé database.

The company forecast fourth-quarter revenue of $107 million at the midpoint, representing a 21% decline year over year and a 9% decline quarter over quarter.

“The year-over-year decline represents the continuation of the prolonged labor market downturn, while the quarter-over-quarter decline reflects our expectation of a seasonally softer [fourth quarter],” ZipRecruiter stated in a letter to shareholders. “While it is difficult to predict exactly when hiring activity will recover, we are confident in the long-term health of the US labor market and see the inevitable end of the ‘Great Stay’ as a future tailwind.”

ZipRecruiter Inc. - Q3 2024

Share Price

Shares in ZipRecruiter were up 8.86% to $10.81 as of 11:30 a.m. Eastern time on Nov. 7. They were 49.93% above their 52-week low.