LegalZoom.com, Inc. shares fell after the Company's August 5 second-quarter release, in which management lowered full-year revenue guidance to approximately $795-$805 million from a prior range of $810-$830 million and disclosed a workforce reduction of roughly 13%. The reported quarter itself was not the problem. LegalZoom posted revenue of approximately $205.3 million, essentially in line, and adjusted EPS of $0.16 against $0.15 expected. The damage came from the forward outlook: third-quarter revenue was guided to $194 million, below analyst estimates. Management attributed the reset to weaker business-formation activity as declining Google search traffic reduced customer acquisition, with AI-generated answers replacing clicks and paid search becoming more expensive and less efficient. The Company's AI and partner channels were described by analysts as not yet sufficient to offset the shortfall. JPMorgan and William Blair both downgraded LZ following the release, citing reduced growth visibility and search-channel uncertainty.