10-Q · May 6, 2026
Nextdoor Holdings, Inc. reported Q1 2026 revenue of $61.7 million, up 14% from the prior year, marking a significant rebound in revenue streams. The company also reduced its net loss to $11.4 million, nearly halving the…
Earnings analysis · 10-Q
NXDR earnings analysis
Filed August 4, 2026 · Our reading of the company's report
The latest report
Nextdoor delivered a strong Q2 turnaround: revenue rose 15% year over year to $74.554 million, gross margin expanded to 84.6%, and operating margin improved to negative 7.6% from negative 31.1%. The $2.122 million net…
Read full summary
Nextdoor delivered a strong Q2 turnaround: revenue rose 15% year over year to $74.554 million, gross margin expanded to 84.6%, and operating margin improved to negative 7.6% from negative 31.1%. The $2.122 million net loss was 86% lower year over year, supported by lower operating expenses and positive adjusted EBITDA of $9.540 million. Liquidity is robust at $378.0 million with no debt, although management still expects losses for the foreseeable future and disclosed new AI and digital-advertising regulatory exposures.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
From revenue to operating profit
Where each $100 of revenue went in this report.
Cost of sales, operating expenses, and what remained. Figures are rounded to whole dollars.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
What stood out
-
Revenue accelerated to $74.6 million
Q2 revenue was $74.554 million, up $9.461 million (15%) from $65.093 million a year earlier and $12.885 million (21%) from implied Q1 revenue of $61.669 million. Management attributed the increase to higher advertiser spending and a 5% rise in Platform WAU.
-
Gross margin expanded year over year
Gross margin was 84.6% in Q2, up from 83.6% a year ago and 82.1% in Q1. Revenue grew 15% year over year while cost of revenue increased 8% to $11.475 million, despite a $1.3 million increase in third-party hosting costs.
-
Operating loss narrowed sharply
Operating margin improved to negative 7.6%, from negative 31.1% in Q2 2025 and negative 24.9% in Q1 2026. Total costs and expenses declined 6% to $80.220 million, including a $3.280 million reduction in sales and marketing expense.
-
Near-breakeven GAAP loss and positive EBITDA
GAAP net loss narrowed 86% to $2.122 million from $15.362 million, while adjusted EBITDA improved to positive $9.540 million from a $2.247 million loss. Diluted EPS was not explicitly presented in the extracted filing text.
-
Engagement and monetization both increased
Platform WAU increased 5% to 22.9 million and Platform ARPU increased 9% to $3.26, versus 21.8 million and $2.99, respectively, a year earlier. The simultaneous user and ARPU growth supports management's advertiser-spending explanation for the $9.461 million revenue gain.
-
Liquidity remains substantial and debt-free
Six-month operating cash flow rose to $9.600 million from $3.314 million. The company had $378.0 million in cash, cash equivalents and marketable securities and no debt outstanding at June 30, 2026.
What to watch
-
Profitability remains unproven
Management expects net losses to continue for the foreseeable future despite the Q2 loss narrowing to $2.122 million; accumulated deficit was $931.8 million at June 30, 2026. The filing also says future spending may increase for R&D, sales and marketing, infrastructure and international expansion.
-
New digital-ad tax exposure in 2027
The filing newly emphasizes targeted-advertising and social-media tax exposure: Chicago's Social Media Amusement Tax became effective in January 2026, while Illinois and Utah targeted-advertising measures take effect in January 2027. Because substantially all revenue is advertising-derived, these taxes could raise compliance and operating costs disproportionately.
-
AI regulation and third-party model risk
Updated AI and platform-regulation disclosures cite EU AI Act transparency obligations taking effect in August 2026 and high-risk AI-system obligations deferred to December 2027. The company is testing AI-powered experiences and relies on third-party AI models, creating potential accuracy, privacy, content-moderation and regulatory-cost risks.
Management's outlook
The 10-Q contains no quantitative revenue or EPS outlook. Management states it anticipates meeting short-term working-capital and capital-expenditure needs with its $378.0 million of cash, cash equivalents and marketable securities; numeric outlook appears deferred to earnings materials outside this filing.
Earlier filings 4
10-K · February 18, 2026
Nextdoor positions itself as a hyperlocal advertising platform powered by first‑party neighborhood data and a 2025-launched product transformation (“Nextdoor initiative”) to increase engagement and monetization. The…
10-Q · May 7, 2025
Nextdoor reported Q1 2025 revenue of $54.18M, up $1.03M (+1.9%) versus Q1 2024, with gross margin expanding to ~82.6% and operating loss narrowing. The company generated positive operating cash flow of $0.37M and modest…
10-K · February 27, 2025
Nextdoor’s 2024 Form 10-K emphasizes scale and product evolution: more than 100 million Verified Neighbors and 46 million Weekly Active Users across 340,000+ neighborhoods in 11 countries, and a 2024-launched NEXT…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.