LinkedIn shares advance 10% 

Shares in LinkedIn LNKD rallied 10% in late trading Thursday after the professional networking service reported adjusted profit and sales that blew past estimates, fueled by growth in its recruiting and premium subscriptions business.

LinkedIn swung to a $934,000, or penny a share, net loss. Non-GAAP profits — which exclude stock-based compensation and acquisition costs — rose to $63 million, or 51 cents a share, from 38 cents a share in the year-ago quarter. Revenue for the Mountain View, Calif. company rose 47% to $534 million.

Analysts expected earnings of 39 cents on sales of $511 million.

LinkedIn is the latest social media company to best Wall Street forecasts. Twitter TWTR and Facebook FB shares have rallied this month after strong results.

The company also forecast adjusted profit of 44 cents a share for the third quarter, and $1.80 a share for the year. Analysts were expecting 40 cents for the third quarter and $1.64 for the year.

Sales from its talent solutions, or its professional recruiting business, rose 49% to $322 million. The business now makes up 60% of total revenue. Premium subscriptions rose 44% to $105 million.

Total membership grew to 313.4 million, up 32% year-over-year and 6% from the first three months of the year.

Two-thirds of LinkedIn members come from outside the U.S., LinkedIn CEO Jeff Weiner said in prepared remarks. LinkedIn’s biggest growth region? China. “After launching our Simplified Chinese site in February, China has now become our fastest growing major market for new members over the past several months,” Weiner said.

Daily new users in China rose 80% since the February, reported China Internet Watch.

Earlier this week, LinkedIn updated profiles on its mobile apps and last month launched its LinkedIn Connected app, both aimed at increasing daily traffic across its platforms.

Also Thursday, LinkedIn launched a product called Sales Navigator, designed to help buyers build relationships with relevant sales professionals. Last week, it bought B2B marketing platform Bizo.

Shares fell 3.6% in regular trading Thursday.

But in a note previewing LinkedIn’s earnings, BGC Financial technology analyst Colin Gillis expressed positivity. “Despite the volatility in the stock, and we mention that shares of LinkedIn have traded down on 4 of the last 6 company earnings, we are positive on both the short term and the longer term prospects for the company,” he wrote.

Among social media companies, Gillis said, LinkedIn “continues to be in the best position to capture and monetize the economic graph.”

 

Source: Usatoday

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