On Friday, Citi reaffirmed its Neutral rating and a $2.65 price target for Nextdoor Holdings Inc. (NYSE:KIND), following a discussion with the company's top executives. The conversation, which took place during the annual Citi Tech conference, provided insights into Nextdoor's strategies and the development of its platform, known as the NEXT Nextdoor.
The discussion with Nextdoor’s CEO, Nirav Tolia, and CFO, Matt Anderson, led to five key observations. The anticipated NEXT Nextdoor platform is expected to focus on discovery, enhancing user engagement. Advances in AI and product innovation are contributing to user acquisition and deeper session engagement. The Nextdoor Ads Platform and Self-Serve features are showing promise in improving the company's monetization efforts.
Moreover, the approach to advertising is evolving, with ads being integrated as content, leveraging local relevance and increased personalization. Lastly, the company's path to profitability is being shaped by a commitment to productivity and efficiency.
Citi's analysis indicates that while Nextdoor is in the early stages of its turnaround, there are positive signs in the company's vision for the NEXT platform and its potential for improved monetization, provided it continues to focus on operational discipline. The firm has chosen to maintain its current rating and price target for Nextdoor's shares.
In other recent news, Nextdoor Holdings, Inc. reported an 11% year-over-year increase in revenue for the second quarter of 2024, totaling $63 million. Despite an adjusted EBITDA loss of $6 million, the company anticipates a revenue growth of about 10% for the full year and is aiming for positive free cash flow in the fourth quarter of 2024.
Nextdoor's weekly active users surpassed 45 million, and the company expects to see significant product progress by mid-2025. The company's "Next" product transformation is aimed at revitalizing the user experience and establishing Nextdoor as an essential neighborhood network.
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