Nextdoor Holdings, Inc. [KIND] Filings

10-Q 1 kvsb-20230930.htm 10-Q kvsb-20230930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2023


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-40246

Nextdoor Holdings, Inc.

(Exact Name of Registrant as Specified in Its Charter)


Delaware						86-1776836
(State or Other Jurisdiction of Incorporation or Organization)						(I.R.S. Employer Identification Number)

420 Taylor Street San Francisco, California (Address of Principal Executive Offices)						94102 (Zip Code)
Registrant’s telephone number, including area code: (415) 344-0333 Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A common stock, par value $0.0001 per share	KIND	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of November 3, 2023, there were 182,078,094 shares of the registrant’s Class A common stock outstanding and 203,049,749 shares of the registrant’s Class B common stock outstanding.

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		Page
Special Note Regarding Forward-Looking Statements		2
Risk Factor Summary		4
	Part I - Financial Information
Item 1.	Financial Statements (Unaudited)	6
	Condensed Consolidated Balance Sheets	6
	Condensed Consolidated Statements of Operations	7
	Condensed Consolidated Statements of Comprehensive Loss	8
	Condensed Consolidated Statements of Stockholders’ Equity	9
	Condensed Consolidated Statements of Cash Flows	11
	Notes to Condensed Consolidated Financial Statements	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	33
Item 4.	Controls and Procedures	33
	Part II - Other Information
Item 1.	Legal Proceedings	35
Item 1A.	Risk Factors	36
Item 2.	Unregistered Sales of Equity Securities, Use of Proceeds, and Issuer Purchases of Equity Securities	65
Item 3.	Defaults Upon Senior Securities	66
Item 4.	Mine Safety Disclosures	66
Item 5.	Other Information	66
Item 6.	Exhibits	67
Signatures		68

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (“Quarterly Report”) contains forward-looking statements within the meaning of the federal securities laws. All statements contained in this Quarterly Report, other than statements of historical fact, including statements regarding our or our management team’s expectations, hopes, beliefs, intentions, strategies, future operating results and financial position, potential growth or growth prospects, are forward-looking statements. Words such as “believes,” “may,” “will,” “estimates,” “potential,” “continues,” “anticipates,” “intends,” “expects,” “could,” “would,” “projects,” “plans,” “targets,” and variations of such words and similar expressions are intended to identify forward-looking statements. Forward-looking statements in this Quarterly Report may include, for example, statements about:

•our anticipated growth, including our ability to scale new neighbor growth, our ability to grow engagement by our existing neighbor base and our ability to increase monetization of our platform;

•our ability to scale our business and monetization efforts;

•the political, economic, and macroeconomic climate, whether in the advertising industry in general, or among specific types of advertisers or within particular geographies, including but not limited to the impacts related to recent turmoil in the global banking system, labor shortages, supply chain disruptions, a potential recession, a potential temporary federal government shutdown, inflation, and rising interest rates;

•our ability to expand our business operations abroad by opening new and expanding within existing neighborhoods outside of the United States;

•our ability to respond to general economic conditions;

•our ability to invest in, and the ultimate success of, technologies aimed at enhancing our business solutions and delivering additional value to our platform;

•our ability to scale our business effectively;

•our ability to achieve and maintain profitability in the future;

•our ability to access sources of capital to finance operations and growth;

•the success of strategic relationships with third parties;

•our ability to maintain the listing of our Class A common stock on the New York Stock Exchange;

•changes in applicable laws or regulations, both within and outside of the United States;

•the impact of the regulatory environment and complexities with compliance related to such environment;

•the inability to develop and maintain effective internal controls;

•the impact on our business as a result of interruptions, delays, or failures resulting from earthquakes, fires, floods, adverse weather conditions, other natural disasters, power loss, terrorism, pandemics, geopolitical conflict (including the war in Ukraine and the Israel-Hamas war), other physical security threats, cyber-attacks, or other catastrophic events;

•our ability to raise financing in the future;

•our success in retaining or recruiting, or changes required in, our officers, key employees, or directors;

•our financial performance; and

•other factors detailed in Part II, Item 1A, “Risk Factors” in this Quarterly Report.

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We have based these forward-looking statements largely on our current expectations and projections as of the date of this filing about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in Part II, Item 1A, “Risk Factors” in this Quarterly Report. Readers are urged to carefully review and consider the various disclosures made in this Quarterly Report and in other documents we file from time to time with the Securities and Exchange Commission (the “SEC”), that disclose risks and uncertainties that may affect our business. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for us to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties, and assumptions, the future events and circumstances discussed in this Quarterly Report may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, performance, or achievements. In addition, the forward-looking statements in this Quarterly Report are made as of the date of this filing, and we do not undertake, and expressly disclaim any duty, to update such statements for any reason after the date of this Quarterly Report or to conform statements to actual results or revised expectations, except as required by law.

You should read this Quarterly Report and the documents that we reference herein and have filed with the SEC as exhibits to this Quarterly Report with the understanding that our actual future results, performance, and events and circumstances may be materially different from what we expect.

As used in this Quarterly Report, the terms “Nextdoor,” “we,” “us,” “Registrant,” and “our” mean Nextdoor Holdings, Inc. and its subsidiaries unless the context indicates otherwise. The term “Business Combination” refers to the transactions contemplated by the that certain Agreement and Plan of Merger, dated as of July 6, 2021, by and among Khosla Ventures Acquisition Co. II, Nextdoor, Inc., and Lorelei Merger Sub Inc., as amended by Amendment No. 1 to the Agreement and Plan of Merger, dated as of September 30, 2021, including (i) the merger contemplated by the Agreement and Plan of Merger, whereby Lorelei Merger Sub Inc. merged with and into Nextdoor, Inc., with Nextdoor, Inc. surviving the merger as a wholly-owned subsidiary of Khosla Ventures Acquisition Co. II, and (ii) the private placement pursuant to which investors collectively subscribed for 27,000,000 shares of our Class A common stock at $10.00 per share, for an aggregate purchase price of $270,000,000.

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RISK FACTOR SUMMARY

Our business is subject to numerous risks and uncertainties, including those described in Part II, Item 1A, “Risk Factors” in this Quarterly Report. You should carefully consider these risks and uncertainties when investing in our Class A common stock. Some of the principal risks and uncertainties include the following:

•We have a limited operating history at the current scale of our business and are still scaling up our monetization efforts, which makes it difficult to evaluate our current business and future prospects, and there is no assurance we will be able to scale our business for future growth.

•Adverse global economic and financial conditions could harm our business and financial condition.

•We currently generate substantially all of our revenue from advertising. If advertisers reduce or eliminate their spending with us, our business, operating results, and financial condition would be adversely impacted.

•Our business is highly competitive. Competition presents an ongoing threat to the success of our business.

•Our business is dependent on our ability to maintain and scale our product offerings and technical infrastructure, and any significant disruption in the availability of our platform could damage our reputation, result in a potential loss of neighbors and engagement, and adversely affect our business, operating results, and financial condition.

•If we fail to scale our business effectively, our business, operating results, and financial condition would be adversely affected.

•If our efforts to build strong brand identity and reputation are not successful, we may not be able to attract or retain neighbors, and our business, operating results, and financial condition will be adversely affected.

•We plan to continue expanding our international operations where we have limited operating experience and may be subject to increased business, regulatory, and economic risks that could seriously harm our business, operating results, and financial condition.

•If we need additional capital in the future, it may not be available on favorable terms, if at all.

•Our business depends largely on our ability to attract and retain talented employees, including senior management. If we lose the services of Sarah Friar, our Chief Executive Officer and President, or other members of our senior management team, we may not be able to execute on our business strategy.

•We are dependent on third-party software and service providers, including the Google Ad Manager (“GAM”) platform, for management and delivery of advertisements on the Nextdoor platform. Any failure or interruption experienced by such third-parties could result in the inability of certain businesses to advertise on our platform, and adversely impact our business, operating results, and financial condition.

•We rely on third-party software and service providers, including Amazon Web Services (“AWS”), to provide systems, storage and services for our platform. Any failure or interruption experienced by such third parties could result in the inability of neighbors and advertisers to access or utilize our platform, and adversely impact our business, operating results, and financial condition.

•Technologies have been developed that can block the display of advertisements on the Nextdoor platform, which could adversely impact our business, operating results, and financial condition.

•Security breaches, including improper access to or disclosure of our data or our neighbors’ data, or other hacking and phishing attacks on our or third-party systems, could harm our reputation and adversely affect our business.

•Distribution and marketing of, and access to, our platform depends, in significant part, on a variety of third-party publishers and platforms (including mobile app stores, third-party payment providers, computer systems, and other communication systems and service providers). If these third parties limit, prohibit or otherwise interfere with or change the terms of the distribution, use or marketing of our platform in any material way, it could materially adversely affect our business, operating results, and financial condition.

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•Certain of our market opportunities and key metric estimates could prove to be inaccurate, and any real or perceived inaccuracies may harm our reputation and negatively affect our business.

•We have a history of net losses and may experience net losses in the future and we cannot assure you that we will achieve or sustain profitability. If we cannot achieve and sustain profitability, our business, financial condition, and operating results will be adversely affected.

•We may have greater than anticipated tax liabilities, which could harm our business, revenue and financial results.

•We cannot guarantee that our Share Repurchase Program will be fully consummated or that it will enhance long-term stockholder value. Share repurchases could also increase the volatility of the trading price of our stock and diminish our cash reserves.

•We may be liable as a result of content or information that is published or made available on our platform.

•Our business is subject to complex and evolving U.S. and foreign laws, regulations, and industry standards, many of which are subject to change and uncertain interpretations, which uncertainty could harm our business, operating results, and financial conditions.

•We could be involved in legal disputes that are expensive and time consuming, and, if resolved adversely, could harm our business, operating results, and financial condition.

•Failure to maintain effective systems of internal controls and disclosure controls could have a material adverse effect on our business, operating results, and financial condition.

•If we are unable to protect our intellectual property, the value of our brands and other intangible assets may be diminished, and our business, operating results, and financial condition may be adversely affected.

•Third parties may claim that our platform infringes their intellectual property rights and this may create liability for us or otherwise adversely affect our business, operating results, and financial condition.

•Our use of “open source” software could subject us to possible litigation or could prevent us from offering products that include open source software or require us to obtain licenses on unfavorable terms.

•We license technology from third parties, and our inability to maintain those licenses could harm our business.

•The price of our Class A common stock has been and may continue to be volatile.

•The dual class structure of our common stock may adversely affect the trading market for our Class A common stock.

•The dual class structure of our common stock has the effect of concentrating voting power with our management and other existing stockholders, which will limit your ability to influence the outcome of important transactions, including a change in control.

•We do not intend to pay cash dividends for the foreseeable future.

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Nextdoor Holdings, Inc.

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands, except per share data)

(Unaudited)


	As of September 30,		As of December 31,
	2023		2022
Assets
Current assets:
Cash and cash equivalents	$	48,444	$	55,236
Marketable securities	491,283		528,067
Accounts receivable, net of allowance of $441 and $422 as of September 30, 2023 and December 31, 2022, respectively	29,991		29,770
Prepaid expenses and other current assets	11,052		12,185
Total current assets	580,770		625,258
Restricted cash, non-current	11,171		—
Property and equipment, net	9,050		11,818
Operating lease right-of-use assets	58,123		52,555
Intangible assets, net	1,746		3,067
Goodwill	1,211		1,211
Other assets	8,029		5,653
Total assets	$	670,100	$	699,562
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	3,307	$	4,535
Operating lease liabilities, current	6,021		7,766
Accrued expenses and other current liabilities	25,313		22,362
Total current liabilities	34,641		34,663
Operating lease liabilities, non-current	62,011		53,831
Other liabilities, non-current	267		—
Total liabilities	96,919		88,494
Commitments and contingencies (Note 7)
Stockholders’ equity:
Class A common stock, $0.0001 par value; 2,500,000 shares authorized, 180,104 and 153,693 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively	18		15
Class B common stock, $0.0001 par value; 500,000 shares authorized, 203,417 and 218,029 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively	20		22
Additional paid-in capital	1,300,845		1,231,482
Accumulated other comprehensive loss	(2,212)		(2,196)
Accumulated deficit	(725,490)		(618,255)
Total stockholders’ equity	573,181		611,068
Total liabilities and stockholders’ equity	$	670,100	$	699,562

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Nextdoor Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Revenue	$	56,092	$	53,954	$	162,752	$	159,495
Costs and expenses:
Cost of revenue	10,723		9,882		31,074		29,124
Research and development	39,649		33,398		109,748		95,057
Sales and marketing	30,564		29,000		91,159		92,688
General and administrative	19,532		18,066		55,401		50,499
Total costs and expenses	100,468		90,346		287,382		267,368
Loss from operations	(44,376)		(36,392)		(124,630)		(107,873)
Interest income	6,766		2,703		18,635		5,347
Other income (expense), net	(217)		(709)		(526)		(1,602)
Loss before income taxes	(37,827)		(34,398)		(106,521)		(104,128)
Provision for income taxes	289		319		714		380
Net loss	$	(38,116)	$	(34,717)	$	(107,235)	$	(104,508)
Net loss per share attributable to Class A and Class B common stockholders, basic and diluted	$	(0.10)	$	(0.09)	$	(0.28)	$	(0.27)
Weighted average shares used in computing net loss per share attributable to Class A and Class B common stockholders, basic and diluted	381,482		377,756		376,832		381,571

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Nextdoor Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS

(in thousands)

(Unaudited)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

Net loss	$	(38,116)	$	(34,717)	$	(107,235)	$	(104,508)
Other comprehensive income (loss):
Foreign currency translation adjustments	29		291		72		783
Change in unrealized loss on available-for-sale marketable securities	21		(709)		(88)		(4,157)
Total other comprehensive loss	$	50	$	(418)	$	(16)	$	(3,374)
Comprehensive loss	$	(38,066)	$	(35,135)	$	(107,251)	$	(107,882)

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Nextdoor Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands)

(Unaudited)


	Three Months Ended September 30, 2023
	Class A Common Stock			Class B Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders’Equity
	Shares	Amount		Shares	Amount
Balances as of June 30, 2023	168,422	$	17	209,194	$	21	$	1,272,676	$	(2,262)	$	(687,374)	$	583,078
Release of restricted stock units	3,704	—		—	—		—		—		—		—
Tax withholdings on release of restricted stock units	—	—		—	—		(237)		—		—		(237)

Conversion from Class B to Class A common stock	7,277	1		(7,277)	(1)		—		—		—		—
Issuance of common stock upon exercise of stock options	229	—		1,500	—		4,113		—		—		4,113

Issuance of common stock under employee stock purchase plan	472	—		—	—		940		—		—		940
Vesting of early exercised stock options	—	—		—	—		10		—		—		10
Stock-based compensation	—	—		—	—		23,343		—		—		23,343
Other comprehensive income	—	—		—	—		—		50		—		50
Net loss	—	—		—	—		—		—		(38,116)		(38,116)
Balances as of September 30, 2023	180,104	$	18	203,417	$	20	$	1,300,845	$	(2,212)	$	(725,490)	$	573,181

	Three Months Ended September 30, 2022
	Class A Common Stock			Class B Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders’Equity
	Shares	Amount		Shares	Amount
Balances as of June 30, 2022	154,979	$	16	230,699	$	23	$	1,255,034	$	(3,485)	$	(550,130)	$	701,458
Release of restricted stock units	1,555	—		—	—		—		—		—		—
Repurchase of common stock	(20,191)	(2)		—	—		(66,737)		—		—		(66,739)
Conversion from Class B to Class A common stock	11,343	1		(11,343)	(1)		—		—		—		—
Issuance of common stock upon exercise of stock options	1,587	—		—	—		3,608		—		—		3,608

Issuance of common stock under employee stock purchase plan	552	—		—	—		1,430		—		—		1,430
Vesting of early exercised stock options	—	—		—	—		132		—		—		132
Vesting of restricted stock	—	—		—	—		1,430		—		—		1,430
Stock-based compensation	—	—		—	—		17,270		—		—		17,270
Other comprehensive loss	—	—		—	—		—		(418)		—		(418)
Net loss	—	—		—	—		—		—		(34,717)		(34,717)
Balances as of September 30, 2022	149,825	$	15	219,356	$	22	$	1,212,167	$	(3,903)	$	(584,847)	$	623,454

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	Nine Months Ended September 30, 2023
	Class A Common Stock			Class B Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders’ Equity
	Shares	Amount		Shares	Amount
Balances as of December 31, 2022	153,693	$	15	218,029	$	22	$	1,231,482	$	(2,196)	$	(618,255)	$	611,068
Release of restricted stock units	7,757	—		—	—		—		—		—		—
Tax withholdings on release of restricted stock units	—	—		—	—		(237)		—		—		(237)

Conversion from Class B to Class A common stock	16,112	2		(16,112)	(2)		—		—		—		—
Issuance of common stock upon exercise of stock options	1,510	—		1,500	—		6,676		—		—		6,676

Issuance of common stock under employee stock purchase plan	1,032	1		—	—		2,015		—		—		2,016
Vesting of early exercised stock options	—	—		—	—		174		—		—		174
Stock-based compensation	—	—		—	—		60,735		—		—		60,735
Other comprehensive loss	—	—		—	—		—		(16)		—		(16)
Net loss	—	—		—	—		—		—		(107,235)		(107,235)
Balances as of September 30, 2023	180,104	$	18	203,417	$	20	$	1,300,845	$	(2,212)	$	(725,490)	$	573,181

	Nine Months Ended September 30, 2022
	Class A Common Stock			Class B Common Stock			Additional Paid-in Capital		Accumulated Other Comprehensive Loss		Accumulated Deficit		Total Stockholders’ Equity
	Shares	Amount		Shares	Amount
Balances as of December 31, 2021	78,954	$	8	304,701	$	30	$	1,225,815	$	(529)	$	(480,339)	$	744,985
Release of restricted stock units	2,476	—		97	—		—		—		—		—
Tax withholdings on release of restricted stock units	—	—		—	—		(695)		—		—		(695)
Repurchase of common stock	(23,252)	(2)		—	—		(77,230)		—		—		(77,232)
Conversion from Class B to Class A common stock	88,049	9		(88,049)	(9)		—		—		—		—
Issuance of common stock upon exercise of stock options	3,046	—		2,434	1		11,218		—		—		11,219
Issuance of common stock in connection with acquisition	—	—		173	—		—		—		—		—
Issuance of common stock under employee stock purchase plan	552	—		—	—		1,430		—		—		1,430
Vesting of early exercised stock options	—	—		—	—		383		—		—		383
Vesting of restricted stock	—	—		—	—		4,289		—		—		4,289
Stock-based compensation	—	—		—	—		46,957		—		—		46,957
Other comprehensive loss	—	—		—	—		—		(3,374)		—		(3,374)
Net loss	—	—		—	—		—		—		(104,508)		(104,508)
Balances as of September 30, 2022	149,825	$	15	219,356	$	22	$	1,212,167	$	(3,903)	$	(584,847)	$	623,454

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Nextdoor Holdings, Inc.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)


	Nine Months Ended September 30,
	2023		2022

Cash flows from operating activities
Net loss	$	(107,235)	$	(104,508)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization	4,356		4,169
Stock-based compensation	60,735		46,957
Bad debt expense	75		(40)
Accretion of investments	(6,505)		954
Other	245		(1,631)
Changes in operating assets and liabilities:
Accounts receivable, net	(296)		2,750
Prepaid expenses and other assets	2,815		5,806
Operating lease right-of-use assets	3,539		5,120

Accounts payable	(1,228)		(445)
Operating lease liabilities	(4,230)		(5,280)
Accrued expenses and other liabilities	3,393		5,351
Net cash used in operating activities	(44,336)		(40,797)
Cash flows from investing activities
Purchases of property and equipment	(268)		(2,182)
Purchases of marketable securities	(454,897)		(555,052)
Sales of marketable securities	81,266		7,822
Maturities of marketable securities	416,587		224,005
Loan to Opportunity Finance Network	(2,500)		—
Net cash provided by (used in) investing activities	40,188		(325,407)
Cash flows from financing activities
Proceeds from exercise of stock options	6,676		11,219
Proceeds from issuance of common stock under employee stock purchase plan	2,016		1,430
Payment of transaction costs related to the Reverse Recapitalization	—		(314)
Tax withholdings on release of restricted stock units	(237)		(695)
Repurchase of common stock	—		(77,232)
Prepayment under share repurchase program	—		(68)
Net cash provided by (used in) financing activities	8,455		(65,660)
Effect of exchange rate changes on cash and cash equivalents	72		783
Net increase (decrease) in cash and cash equivalents	4,379		(431,081)
Cash, cash equivalents, and restricted cash at beginning of period	55,236		521,812
Cash, cash equivalents, and restricted cash at end of period	$	59,615	$	90,731
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets
Cash and cash equivalents	$	48,444	$	90,731
Restricted cash, non-current	11,171		—
Total cash, cash equivalents, and restricted cash	$	59,615	$	90,731
Supplemental cash flow disclosures

Non-cash investing and financing activities:
Vesting of restricted stock and early exercised stock options	$	174	$	4,672
Lease liabilities arising from obtaining right-of-use assets	$	10,665	$	—
Purchases of property and equipment not yet settled	$	—	$	734

The accompanying notes are an integral part of these condensed consolidated financial statements.

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Notes to Condensed Consolidated Financial Statements

Note 1. Description of Business

Nextdoor Holdings, Inc. (“Nextdoor” or the “Company”) is headquartered in San Francisco, California. Nextdoor’s purpose is to cultivate a kinder world where everyone has a neighborhood they can rely on. That purpose enables the Company’s mission to be the neighborhood hub for trusted connections and the exchange of helpful information, goods, and services.

On November 5, 2021 (the “Closing”), the Company consummated the transactions contemplated by the Agreement and Plan of Merger, dated July 6, 2021, as amended on September 30, 2021, by and among Khosla Ventures Acquisition Co. II (“KVSB”), a special purpose acquisition company, Lorelei Merger Sub Inc., and Nextdoor, Inc. (“Legacy Nextdoor”), with Legacy Nextdoor surviving as a wholly owned subsidiary of KVSB (the “Merger” and, collectively with the other transactions that occurred in connection with the Merger, the “Reverse Recapitalization”). In connection with the Closing, KVSB was renamed to Nextdoor Holdings, Inc.

Note 2. Summary of Significant Accounting Policies

Basis of Presentation

The unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and include the accounts of the Company and its wholly owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The Company’s fiscal year ends on December 31.

The condensed consolidated balance sheet as of December 31, 2022 included herein was derived from the audited financial statements as of that date. The Company has condensed or omitted certain information and note disclosures normally included in financial statements prepared in accordance with GAAP pursuant to the applicable required disclosures and regulations of the U.S. Securities and Exchange Commission (“SEC”). As such, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.

In management’s opinion, the unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include only normal recurring adjustments necessary for the fair statement of the Company’s financial position, results of operations, and cash flows. The results for the interim periods presented are not necessarily indicative of the results to be expected for the full year ending December 31, 2023 or any other future interim or annual period.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Estimates include, but are not limited to, valuation of financial instruments, valuation of common stock through the date of the Reverse Recapitalization, valuation of stock-based awards, revenue recognition, collectability of accounts receivable, valuation of acquired intangible assets and goodwill, useful lives of intangible assets, useful lives of property and equipment, the incremental borrowing rate applied in lease accounting, income taxes and deferred income tax assets and associated valuation allowances. The Company bases these estimates and assumptions on historical experience and various other assumptions that it considers reasonable. The actual results could differ materially from these estimates.

Significant Accounting Policies

There have been no changes to the Company’s significant accounting policies disclosed in Note 2 to the consolidated financial statements described in the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2022 that have had a material impact on the Company’s condensed consolidated financial statements and related notes, except as noted below.

Restricted Cash

The Company’s restricted cash balance is primarily invested in a savings account and pledged as collateral for standby letters of credit as security deposits for the Company’s office leases.

Recently Adopted Accounting Pronouncements

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In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, and has since issued various amendments including ASU 2018-19, ASU 2019-04, and ASU 2019-05. The guidance and related amendments modify the accounting for credit losses for most financial assets and require the use of an expected loss model, replacing the currently used incurred loss method. Under this model, entities will be required to estimate the lifetime expected credit loss on such instruments and record an allowance to offset the amortized cost basis of the financial asset, resulting in a net presentation of the amount expected to be collected on the financial asset. The Company adopted this standard as of January 1, 2023, and the adoption did not have an impact on the Company’s unaudited condensed consolidated financial statements.

Note 3. Deferred Revenue

In certain advertising arrangements the Company requires payment upfront from its customers. The Company records deferred revenue when it collects cash from customers in advance of revenue recognition. As of September 30, 2023 and December 31, 2022, deferred revenue was $8.3 million and $6.0 million, respectively, and included within accrued expenses and other current liabilities on the condensed consolidated balance sheets. For the three months ended September 30, 2023 and 2022, revenue recognized from deferred revenue at the beginning of each period was $2.8 million and $2.6 million, respectively. For the nine months ended September 30, 2023 and 2022, revenue recognized from deferred revenue at the beginning of each period was $2.9 million and $2.9 million, respectively.

Note 4. Cash Equivalents and Marketable Securities

The amortized costs, unrealized gains and losses, and estimated fair values of the Company’s cash equivalents and marketable securities were as follows (in thousands):


	As of September 30, 2023
	Amortized Cost		Unrealized Gain		Unrealized Loss		Estimated Fair Value
Cash equivalents:
Money market funds	$	28,609	$	—	$	—	$	28,609
Corporate bonds	478		—		—		478

Total cash equivalents	$	29,087	$	—	$	—	$	29,087
Marketable securities:
Certificates of deposit	50,460		14		(8)		50,466
Commercial paper	101,600		1		(213)		101,388
Corporate bonds	159,929		38		(746)		159,221
U.S. Treasury securities	70,921		—		(1,260)		69,661
U.S. Agency bonds	76,343		—		(268)		76,075
Asset-backed securities	34,525		7		(60)		34,472
Total marketable securities	493,778		60		(2,555)		491,283
Total	$	522,865	$	60	$	(2,555)	$	520,370

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	As of December 31, 2022
	Amortized Cost		Unrealized Gain		Unrealized Loss		Estimated Fair Value
Cash equivalents:
Money market funds	$	20,381	$	—	$	—	$	20,381
Corporate bonds	6,021		3		—		6,024
Commercial paper	9,394		—		(3)		9,391
Total cash equivalents	$	35,796	$	3	$	(3)	$	35,796
Marketable securities:
Certificates of deposit	44,732		9		(191)		44,550
Commercial paper	100,909		27		(92)		100,844
Corporate bonds	280,023		11		(1,980)		278,054
U.S. Treasury securities	41,646		3		(123)		41,526
U.S. Agency bonds	46,366		66		(22)		46,410
Asset-backed securities	16,798		—		(115)		16,683
Total marketable securities	530,474		116		(2,523)		528,067
Total	$	566,270	$	119	$	(2,526)	$	563,863

All marketable securities are designated as available-for-sale securities as of September 30, 2023 and December 31, 2022.

The following table summarizes the fair value and gross unrealized losses aggregated by category and the length of time that individual securities have been in a continuous unrealized loss position. No investments had been in a continuous unrealized loss position for greater than 12 months as of December 31, 2022.


	As of September 30, 2023
	Less than 12 Months				12 Months or Greater				Total
	Fair Value		Gross Unrealized Loss		Fair Value		Gross Unrealized Loss		Fair Value		Gross Unrealized Loss
Certificates of deposit	$	19,670	$	(8)	$	—	$	—	$	19,670	$	(8)
Commercial paper	96,403		(213)		—		—		96,403		(213)
Corporate bonds	85,540		(523)		26,626		(223)		112,166		(746)
U.S. Treasury securities	69,335		(1,260)		—		—		69,335		(1,260)
U.S. Agency bonds	75,520		(268)		—		—		75,520		(268)
Asset-backed securities	22,610		(38)		2,453		(22)		25,063		(60)
Total	$	369,078	$	(2,310)	$	29,079	$	(245)	$	398,157	$	(2,555)

The following tables present the contractual maturities of the Company’s marketable securities (in thousands):


	As of September 30, 2023
	Amortized Cost		Estimated Fair Value
Due within one year	$	301,523	$	300,785
Due after one to three years	192,255		190,498
Total	$	493,778	$	491,283


	As of December 31, 2022
	Amortized Cost		Estimated Fair Value
Due within one year	$	473,133	$	471,378
Due after one to four years	57,341		56,689
Total	$	530,474	$	528,067

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Note 5. Fair Value Measurements

The Company’s financial assets and liabilities measured at fair value on a recurring basis are classified by level within the fair value hierarchy. There were no financial assets or liabilities measured using Level 3 inputs as of September 30, 2023 and December 31, 2022. The following table presents information about the Company’s financial assets that are measured at fair value on a recurring basis (in thousands):


	As of September 30, 2023
	Level 1		Level 2		Total
Cash equivalents:
Money market funds	$	28,609	$	—	$	28,609
Corporate bonds	—		478		478

Total cash equivalents	$	28,609	$	478	$	29,087
Marketable securities:
Certificates of deposit	—		50,466		50,466
Commercial paper	—		101,388		101,388
Corporate bonds	—		159,221		159,221
U.S. Treasury securities	—		69,661		69,661
U.S. Agency bonds	—		76,075		76,075
Asset-backed securities	—		34,472		34,472
Total marketable securities	—		491,283		491,283
Total cash equivalents and marketable securities	$	28,609	$	491,761	$	520,370


	As of December 31, 2022
	Level 1		Level 2		Total
Cash equivalents:
Money market funds	$	20,381	$	—	$	20,381
Corporate bonds	—		6,024		6,024
Commercial paper	—		9,391		9,391
Total cash equivalents	$	20,381	$	15,415	$	35,796
Marketable securities:
Certificates of deposit	—		44,550		44,550
Commercial paper	—		100,844		100,844
Corporate bonds	—		278,054		278,054
U.S. Treasury securities	—		41,526		41,526
U.S. Agency bonds	—		46,410		46,410
Asset-backed securities	—		16,683		16,683
Total marketable securities	—		528,067		528,067
Total cash equivalents and marketable securities	$	20,381	$	543,482	$	563,863

The Company classifies its cash equivalents and marketable securities within Level 1 or Level 2 because it determines their fair values using quoted market prices or alternative pricing sources and models utilizing market observable inputs. There were no transfers between levels of the fair value hierarchy during the periods presented.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

The carrying amounts of certain financial instruments, including cash held in banks, accounts receivable, and accounts payable approximate fair value due to their short-term maturities and are excluded from the fair value table above.

Financial Instruments, Assets, and Liabilities Not Recorded at Fair Value

The following table presents the fair value of assets not recorded at fair value (in thousands):

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	As of September 30, 2023
	Carrying Amount		Level 1		Level 2		Level 3		Fair Value
Assets
Note receivable	$	7,500	$	—	$	—	$	6,998	$	6,998


	As of December 31, 2022
	Carrying Amount		Level 1		Level 2		Level 3		Fair Value
Assets
Note receivable	$	5,000	$	—	$	—	$	4,646	$	4,646

As of September 30, 2023 and December 31, 2022, there were no financial instruments or liabilities that were not recorded at fair value.

Note 6. Leases

The Company has entered into various non-cancellable office facility leases in various locations with original lease periods expiring between 2020 and 2029, with its primary office location in San Francisco, California. The Company entered into a lease consisting of multiple floors for its San Francisco headquarters in 2019, with a lease term through 2029. On January 30, 2023, the Company entered into a lease amendment for its headquarters lease. The lease amendment extended the lease term through April 30, 2032, and resulted in an increase to right-of-use assets and operating lease liabilities. The Company's lease agreements generally do not contain any material residual value guarantees or material restrictive covenants.

The components of lease costs were as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Operating lease cost	$	2,333	$	2,445	$	7,037	$	7,336
Short-term lease cost	545		620		1,358		1,190
Variable lease cost	645		221		1,959		635
Total	$	3,523	$	3,286	$	10,354	$	9,161

Other information related to the Company’s operating leases was as follows (in thousands):


	Nine Months Ended September 30,
	2023		2022
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases	$	7,722	$	7,497
ROU assets obtained in exchange for new operating lease liabilities	$	9,107	$	—

Lease terms and discount rates for operating leases were as follows:


	As of September 30,
	2023		2022
Weighted average remaining lease term (in years)	8.6		6.6
Weighted average discount rate	7.1	%	4.5	%

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As of September 30, 2023, future minimum lease payments under operating leases were as follows (in thousands):


Remainder of 2023	$	2,625
2024	10,657
2025	10,977
2026	10,777
2027	10,586
Thereafter	44,391
Total lease payments	90,013
Less: imputed interest	(21,981)
Present value of lease liabilities	68,032
Less: current operating lease liabilities	(6,021)
Long-term operating lease liabilities	$	62,011

The table above does not include lease payments that were not fixed at commencement or lease modification.

Note 7. Commitments and Contingencies

Legal matters

From time to time, the Company is a party to a variety of claims, lawsuits, and proceedings which arise in the ordinary course of business, including claims of alleged infringement of intellectual property rights. The Company records a liability when it believes that it is probable that a loss will be incurred and the amount of loss or range of loss can be reasonably estimated. The Company discloses potential losses when they are reasonably possible. In the Company’s opinion, resolution of pending matters is not likely to have a material adverse impact on its consolidated results of operations, cash flows, or its financial position. Given the unpredictable nature of legal proceedings, the Company bases its estimate on the information available at the time of the assessment. As additional information becomes available, the Company reassesses the potential liability and may revise the estimate. There were no such material matters as of September 30, 2023 and December 31, 2022.

Indemnification

In the ordinary course of business, the Company often includes standard indemnification provisions in its arrangements with its customers, partners, suppliers, and vendors. Pursuant to these provisions, the Company may be obligated to indemnify such parties for losses or claims suffered or incurred in connection with its service, breach of representations or covenants, intellectual property infringement, or other claims made against such parties. These provisions may limit the time within which an indemnification claim can be made. It is not possible to determine the maximum potential amount under these indemnification obligations due to the limited history of prior indemnification claims and the unique facts and circumstances involved in each particular agreement. For the three and nine months ended September 30, 2023 and 2022, the Company did not incur material costs to defend lawsuits or settle claims related to these indemnifications. The Company believes the fair value of these liabilities is not material and accordingly has no liabilities recorded for these agreements as of September 30, 2023 and December 31, 2022.

Opportunity Finance Network Loan Agreement

On June 29, 2022, the Company entered into a credit agreement with Opportunity Finance Network (“OFN”) to lend up to an aggregate of $15.0 million, unsecured, over the course of 24 months. OFN is a national network of community development financial institutions (“CDFIs”). OFN will use the loan proceeds to make low-cost, fixed-rate loans to OFN-member CDFIs that on-lend those loan proceeds to fund affordable housing, community facilities, small businesses, nonprofit organizations, consumer finance, and other eligible financing extended by such CDFIs. OFN may borrow in increments of $2.0 million or more and may not borrow more than $7.5 million within the first 12 months immediately following the closing date of June 29, 2022. Each disbursement made by the Company will bear interest at a rate of 0.75% per annum and will be due quarterly from OFN. The outstanding principal, plus any accrued and unpaid interest, for each disbursement becomes due and payable 10 years following the disbursement date. During the three months ended September 30, 2023, no disbursements were made related to this loan. During the nine months ended September 30, 2023, the Company made one loan disbursement of $2.5 million. During the year ended December 31, 2022, the Company made one loan disbursement of $5.0 million.

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Note 8. Common Stock and Stockholders’ Equity

Common Stock Subject to Repurchase

Certain stock option grant agreements permit exercise prior to vesting. Upon termination of service of an employee, the Company has the right to repurchase any unvested, but issued, common stock at the original purchase price. The consideration received for an exercise of an option is accounted for as a deposit of the exercise price and is recorded as a liability. Upon vesting of the shares pursuant to the grant agreements, the shares and related liability are reclassified into stockholders’ equity. As of September 30, 2023, all shares of common stock subject to repurchase were fully vested with no balance remaining. As of December 31, 2022, the Company had $0.2 million recorded in accrued expenses and other current liabilities related to 101,593 unvested shares of common stock subject to repurchase.

Equity Incentive Plans

2021 Equity Incentive Plan

In November 2021, the Company’s Board of Directors and stockholders approved the Company’s 2021 Equity Incentive Plan (the “2021 Plan”) as a successor to the 2018 Equity Incentive Plan (the “2018 Plan”), with the purpose of granting stock-based awards to employees, directors, officers, and consultants, including stock options, restricted stock awards, and restricted stock units (“RSUs”).

The Company initially reserved for issuance under the 2021 Plan (a) 46,008,885 shares of Class A common stock, plus (b) shares that are subject to issuance upon exercise of options granted under the 2018 Plan prior to the Closing but which, after the Closing, cease to be subject to the option for any reason other than exercise of the option, (c) shares that are subject to awards granted under the 2018 Plan prior to the Closing that, after the Closing, are forfeited or are repurchased by the Company at the original issue price, (d) shares that are subject to awards granted under the 2018 Plan prior to the Closing that, after the Closing, otherwise terminate without such shares being issued, and (e) shares that, after the Closing, are used to pay the exercise price of a stock option issued under the 2018 Plan prior to the Closing or are withheld to satisfy the tax withholding obligations related to any award issued under the 2018 Plan prior to the Closing. The number of shares available for grant and issuance under the 2021 Plan will increase automatically on January 1 of each of 2022 through 2031 by the number of shares equal to the lesser of (i) five percent (5%) of the number of shares (rounded down to the nearest whole share) of Class A common stock and Class B common stock issued and outstanding on each December 31 immediately prior to the date of increase, or (ii) such number of shares determined by the Company’s Board of Directors.

2021 Employee Stock Purchase Plan

In November 2021, the Company’s Board of Directors and stockholders approved the Company’s 2021 Employee Stock Purchase Plan (the “2021 ESPP”). Over a series of offering periods, each of which may consist of one or more purchase periods, eligible employees will be offered the option to purchase shares of Class A common stock at 85% of the lesser of the fair market value of Class A common stock on (i) the first business day of the applicable offering period and (ii) the date of purchase. Under the 2021 ESPP, the Company initially reserved 8,901,159 shares of Class A common stock for issuance, and the aggregate number of shares reserved will increase automatically on January 1 of each of 2022 through 2031 by the number of shares equal to the lesser of (i) one percent (1%) of the total number of outstanding shares of Class A common stock and Class B common stock as of the immediately preceding December 31, or (ii) a number of shares as may be determined by the Company’s Board of Directors. The aggregate number of shares issued over the term of the 2021 ESPP, subject to adjustments for stock-splits, recapitalizations, or similar events, may not exceed 89,011,590 shares. In February 2022, the Company commenced its first offering period under the 2021 ESPP. During the three and nine months ended September 30, 2023, 472,606 and 1,032,313 shares of Class A common stock were purchased under the 2021 ESPP, respectively.

Share Repurchase Program

On May 31, 2022, the Company’s Board of Directors authorized and approved a share repurchase program (the “Share Repurchase Program”) to repurchase up to $100.0 million in aggregate of the Company’s Class A common stock, with the authorization to expire on June 30, 2024. Repurchases of Class A common stock under the Share Repurchase Program may be made from time to time, on the open market, in privately negotiated transactions or by other methods, and in accordance with the limitations set forth in Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended, and other applicable legal requirements. The timing of any repurchases will depend on market conditions and other investment opportunities, and will be made at the Company’s discretion. The Company currently anticipates that the Share Repurchase Program will extend through June 30, 2024, or such shorter period if $100.0 million in aggregate of shares of the Company’s Class A common stock have been repurchased. The Share Repurchase Program does

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not obligate the Company to repurchase any dollar amount or number of shares, and the program may be extended, modified, suspended, or discontinued at any time.

When the Company repurchases shares under the Share Repurchase Program, it reduces the common stock component of stockholders’ equity by the par value of the repurchased shares. The excess of the repurchase price over par value is recorded to additional paid-in capital. All repurchased shares are retired and become authorized and unissued shares.

During the three and nine months ended September 30, 2023, the Company did not repurchase or retire any shares of its Class A common stock. During the three and nine months ended September 30, 2022, the Company repurchased and retired 20,190,611 and 23,251,703 shares of Class A common stock at an average purchase price of $3.31 and $3.32 per share for an aggregate repurchase price of $66.7 million and $77.2 million, respectively. As of September 30, 2023, the Company had $22.8 million available for future share repurchases under the Share Repurchase Program.

Stock Options and RSUs

The Company may grant options to acquire shares of Class A common stock to employees, directors, officers, and consultants at a price not less than the fair market value of the shares at the date of grant. Options granted to a person who, at the time of the grant, owns more than 10% of the voting power of all classes of stock shall be at no less than 110% of the fair market value and expire five years from the date of grant. All other options generally have a contractual term of ten years. Options granted generally vest on a monthly basis over two to four years. RSUs granted for Class A common stock generally vest on a quarterly basis over two to four years.

A summary of the Company’s stock option activity for the nine months ended September 30, 2023 and related information is as follows (in thousands, except per share data):


	Number of Options	Weighted Average Exercise Price		Weighted Average Remaining Contractual Term (years)	Aggregate Intrinsic Value
Outstanding at December 31, 2022	55,388	$	2.67	7.5	$	10,552
Options granted	2,936	$	2.30
Options exercised	(3,010)	$	2.22
Options forfeited or expired	(3,604)	$	2.73
Outstanding at September 30, 2023	51,710	$	2.68	6.5	$	7,187
Exercisable at September 30, 2023	33,236	$	2.16	5.5	$	7,187
Vested or expected to vest at September 30, 2023	51,710	$	2.68	6.5	$	7,187

The intrinsic value is calculated as the difference between the exercise price of the underlying common stock option award and the fair value of the Company’s common stock as of the respective balance sheet date. The weighted average grant date fair value of options granted was $1.45 per share and $3.13 per share during the nine months ended September 30, 2023 and 2022, respectively.

The intrinsic value of the options exercised was $1.8 million and $13.4 million for the nine months ended September 30, 2023 and 2022, respectively.

A summary of the Company’s RSU activity for the nine months ended September 30, 2023 and related information is as follows (in thousands, except per share data):


	Number of Shares	Weighted Average Grant Date Fair Value
Unvested at December 31, 2022	21,986	$	4.25
RSUs granted	21,204	$	2.37
RSUs vested	(7,863)	$	3.55
RSUs forfeited	(3,787)	$	4.11
Unvested at September 30, 2023	31,540	$	3.18

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Valuation Assumptions

The following assumptions were used to calculate the fair value of employee and non-employee stock option grants made during the following periods:


	Nine Months Ended September 30,
	2023	2022
Expected volatility	64.9% - 72.7%	53.9% -73.9%
Expected term (in years)	5.0 - 6.2	6.0
Risk-free interest rate	3.4% - 4.3%	2.6%
Expected dividend yield	—	—
Fair value of common stock per share	$1.91 - $3.31	$3.34 - $6.06

Stock-Based Compensation

The Company recorded stock-based compensation expense in the condensed consolidated statements of operations as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

Cost of revenue	$	835	$	732	$	2,311	$	1,906
Research and development	12,107		9,630		31,804		25,914
Sales and marketing	3,582		2,621		9,140		7,617
General and administrative	6,819		4,287		17,480		11,520
Total	$	23,343	$	17,270	$	60,735	$	46,957

As of September 30, 2023, there was $137.9 million of unrecognized stock-based compensation expense, which is expected to be recognized over a weighted average period of 1.8 years.

Note 9. Net Loss Per Share Attributable to Common Stockholders

The following table sets forth the computation of basic and diluted net loss per share attributable to common stockholders (in thousands, except per share data):


	Three Months Ended September 30,								Nine Months Ended September 30,
	2023				2022				2023				2022
	Class A		Class B		Class A		Class B		Class A		Class B		Class A		Class B
Net loss attributable to common stockholders	$	(17,663)	$	(20,453)	$	(14,142)	$	(20,575)	$	(46,819)	$	(60,416)	$	(32,588)	$	(71,920)
Weighted average shares used in computing net loss per share attributable to Class A and Class B common stockholders, basic and diluted	176,780		204,702		153,877		223,879		164,527		212,305		118,984		262,587
Net loss per share attributable to Class A and Class B common stockholders, basic and diluted	$	(0.10)	$	(0.10)	$	(0.09)	$	(0.09)	$	(0.28)	$	(0.28)	$	(0.27)	$	(0.27)

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The following potentially dilutive securities outstanding have been excluded from the computations of diluted net loss per share because such securities have an anti-dilutive impact due to losses reported (in thousands):


	As of September 30,
	2023	2022
Outstanding stock options	51,710	52,426
Unvested RSUs	31,540	20,921
Unvested early exercised stock options subject to repurchase	—	184
Unvested restricted stock	—	321
Shares issuable pursuant to the ESPP	2,481	2,539
Contingently issuable shares	7	7
Total	85,738	76,398

Note 10. Income Taxes

The Company’s provision for income taxes for interim periods was determined using an estimate of its annual effective tax rate, adjusted for discrete items, if any, that arose during the period. Each quarter, the Company updates its estimate of the annual effective tax rate, and if the estimated annual effective tax rate changes, the Company makes a cumulative adjustment in such period.

The Company’s quarterly tax provision, and estimate of its annual effective tax rate, is subject to variation due to several factors, including variability in pretax income or loss, the mix of jurisdictions to which such income or loss relates, tax law developments and changes in how the Company does business, such as acquisitions, intercompany transactions, or the Company’s corporate structure.

The Company recorded an income tax expense for the three months ended September 30, 2023 and 2022 of $0.3 million and $0.3 million, respectively, both of which were primarily related to foreign taxes. The Company recorded an income tax expense for the nine months ended September 30, 2023 and 2022 of $0.7 million and $0.4 million, respectively, both of which were primarily related to foreign taxes.

Note 11. Geographical Information

Revenue disaggregated by geography based on the customers’ location was as follows (in thousands):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022

United States	$	52,964	$	52,205	$	154,239	$	153,715
International	3,128		1,749		8,513		5,780
Total	$	56,092

Nextdoor Holdings, Inc. [KIND] Filings
10-Q	[2023-11-07]
10-Q	[2023-08-08]
10-Q	[2023-05-09]
10-K	[2023-02-28]
10-Q	[2022-11-08]
10-Q	[2022-08-09]
10-Q	[2022-05-10]
10-K	[2022-03-15]
S-1	[2021-11-22]
10-Q	[2021-11-03]
10-Q	[2021-09-10]
10-Q	[2021-06-01]
S-1	[2021-02-12]