Nextdoor’s first quarter results were met with a negative market reaction, despite both revenue and non-GAAP earnings per share aligning with Wall Street expectations. Management attributed the quarter's mixed outcome to continued expense discipline and steady user acquisition, with CEO Nirav Tolia highlighting that “our most significant progress in Q1 was product related as we furthered the transition to NEXT and continue to make its upcoming launch our top priority.” The company noted that short-term trade-offs were made in pursuit of this product overhaul, intentionally prioritizing long-term value over immediate gains.

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While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions Nextdoor’s Q1 Earnings Call

• Eric Sheridan (Goldman Sachs) asked about the timeline for NEXT’s impact on user and monetization growth. CEO Nirav Tolia responded that engagement improvements should come first, with monetization benefits expected after the full rollout by late July.

• Jason Kreyer (Craig-Hallum) questioned how monetization will differ post-NEXT. Tolia outlined three areas: more ad supply from higher engagement, new ad surfaces like alerts, and potential AI-driven commerce opportunities.

• Jason Kreyer (Craig-Hallum) followed up on the timing of programmatic ad rollout. CFO Matt Anderson confirmed that programmatic initiatives are advancing in parallel with NEXT and are expected to contribute to growth later in the year.

• Jamesmichael Sherman-Lewis (Citi) probed the strategy behind the new alerts feature and its impact on engagement metrics. Tolia explained that more targeted, urgent notifications are designed to increase relevance and daily usage, reinforcing Nextdoor’s utility in local crises.

• Youssef Squali (Truist Securities) asked about driving awareness for the new interface without major marketing spend. Tolia stated that product-led notifications and earned media will be the primary channels, leveraging the existing user base to build momentum post-launch.

Catalysts in Upcoming Quarters

As we look ahead, the StockStory team will be tracking (1) the adoption and user engagement trends following the NEXT platform release, (2) the ramp-up of new ad formats and programmatic capabilities, and (3) the impact of transitioning to platform WAU as the primary engagement metric. In addition, we will monitor management’s progress in leveraging AI features to drive monetization and operational efficiency.

Nextdoor currently trades at $1.65, up from $1.51 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).

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