(Bloomberg) -- Nextdoor Holdings Inc. reported a sales outlook that missed analysts’ estimates, saying business conditions are worse than it previously expected.
The company’s revenue in the current quarter will be between $53 million and $55 million, according to a statement Tuesday. That fell short of the $64.6 million average analyst estimate. Its annual revenue projection also missed estimates.
Nextdoor told shareholders that its advertisers are tightening their budgets, “a reflection of rising macroeconomic uncertainty, inflation and labor shortages,” according to its shareholder letter. Real estate, retail and fast-food restaurants are among the sectors pulling back advertising spending, it added.
Chief Executive Officer Sarah Friar said the company is mulling diversifying its revenue streams -- perhaps through monthly subscriptions for small and midsized business pages. The businesses could post in the feed as neighbors, and pay to promote those posts to a wider audience, “and you do that on a monthly subscription rather than a pure impression-based ad,” Friar said on a call with media. “And what SMBs tend to like about that is predictability.”
The Menlo Park, California-based company, known as a neighborhood-centric social media platform, reported $55 million in second-quarter sales, on par with analysts’ estimates of $55.2 million. The company also said its site is still growing, with 36.9 million weekly active users, up slightly from the 36.7 million in the first three months of the year.
Nextdoor fell 8.3% to $3.30 in after-hours trading, after closing at $3.60. The stock has declined 54% so far this year.
(Updates with CEO comment in the fourth paragraph)
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