ZipRecruiter Investor Presentation Deck
Key Operating Metrics and Non-GAAP Financial Measures
This presentation includes certain key operating metrics, including Quarterly Paid Employers and Revenue per Paid Employer, and non-GAAP financial measures, including Adjusted
EBITDA, Adjusted EBITDA margin, Cash Adjusted EBITDA, Cash Adjusted EBITDA margin, Free Cash Flow and Free Cash Flow Margin.
We define Paid Employers as any employer(s) (or entities acting on behalf of an employer) on a paying subscription plan or performance marketing campaign for at least one day. Paid
Employer(s) excludes employers from our Job Distribution Partners or other indirect channels, employers who are not actively searching for candidates, but otherwise have access to
previously posted jobs, and employers on free trial. Job Distribution Partners are defined as third-party sites who have a relationship with us and advertise jobs from our marketplace.
Quarterly Paid Employers means, with respect to any fiscal quarter, the count of Paid Employers during such fiscal quarter. Revenue per Paid Employer is the total company revenue in a
particular period divided by the count of Quarterly Paid Employers in the same period.
We define Adjusted EBITDA as our net income (loss) before total other income (expense), net, income tax expense (benefit) and depreciation and amortization, adjusted to eliminate
stock-based compensation expense. Adjusted EBITDA margin represents Adjusted EBITDA as a percentage of revenue for the same period. We define Cash Adjusted EBITDA as
Adjusted EBITDA further adjusted for certain one-time expenses and changes in deferred revenue. Cash Adjusted EBITDA margin represents Cash Adjusted EBITDA as a percentage of
revenue for the same period. We define Free Cash Flow as cash provided by (used in) operating activities, less purchases of PPE and capitalized internal use software. Free Cash Flow
margin represents Free Cash Flow as a percentage of revenue.
Management and our board of directors use these key operating metrics and non-GAAP financial measures as supplemental measures of our performance because they assist us in
comparing our operating performance on a consistent basis, as they remove the impact of some items not directly resulting from our core operations. We also use these key operating
metrics and non-GAAP financial measures for planning purposes, including the preparation of our internal annual operating budget and financial projections, to evaluate the performance
and effectiveness of our strategic initiatives and to evaluate our capacity for capital expenditures to expand our business.
Adjusted EBITDA, Adjusted EBITDA margin, Cash Adjusted EBITDA, Cash Adjusted EBITDA margin, Free Cash Flow and Free Cash Flow margin should not be considered in isolation,
as an alternative to, or superior to net income (loss), revenue, cash flows or other measures derived in accordance with GAAP. These non-GAAP measures are frequently used by
analysts, investors and other interested parties to evaluate companies in our industry. Management believes that the presentation of non-GAAP financial measures is an appropriate
measure of operating performance because they eliminate the impact of some expenses that do not relate directly to the performance of our underlying business.
These non-GAAP financial measures should not be construed as an inference that our future results will be unaffected by unusual or other items. Additionally, Adjusted EBITDA, Adjusted
EBITDA margin, Cash Adjusted EBITDA, Cash Adjusted EBITDA margin, Free Cash Flow and Free Cash Flow margin are not intended to be a measure of free cash flow for
management's discretionary use, as they do not reflect our tax payments and certain other cash costs that may recur in the future, including, among other things, cash requirements for
costs to replace assets being depreciated and amortized. Management compensates for these limitations by relying on our GAAP results in addition to using Adjusted EBITDA, Adjusted
EBITDA margin, Cash Adjusted EBITDA, Cash Adjusted EBITDA margin, Free Cash Flow and Free Cash Flow margin as supplemental measures of our performance. Our measures of
Adjusted EBITDA, Adjusted EBITDA margin, Cash Adjusted EBITDA, Cash Adjusted EBITDA margin, Free Cash Flow and Free Cash Flow margin used herein are not necessarily
comparable to similarly titled captions of other companies due to different methods of calculation.
See the tables above regarding reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measures.
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