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by admin
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February 7, 2013

Professional networking site LinkedIn on Thursday reported that revenue increased 81% in the fourth quarter, fueled by strong growth across all three
of its key business lines.
The company’s net income for the quarter was $11.5 million, or 10 cents a share compared with $6.9 million, or six cents a share, a year ago. On an adjusted
basis, LinkedIn reported a profit of $40.2 million, or 35 cents a share.
Revenue rose to $303.6 million from $167.7 million in the year-earlier period.
Analysts, on average, had
expected LinkedIn to report a profit of 19 cents a share on revenue of nearly $279.8 million.
Sales from LinkedIn’s recruiting services business nearly doubled to $161 million and
represented more than half (53%) of total revenue. Marketing solutions -- its advertising business -- saw revenue rise 68% to $83.2 million, or 27% of overall revenue, while sales from subscription
services grew 79% to $59.4 million in the fourth quarter. Subscriptions accounted for 20% of total revenue.
U.S. revenue accounted for the majority (62%) of the company’s quarterly
revenue, at $189 million, while international contributed $114.6 million, or 38%.
LinkedIn has rolled out a series of initiatives since last fall, intended to keep users coming back and
sticking around longer on the site. It revamped profile and company pages, allowing members to “follow” each other on Twitter, and recommend others’ skills via the Endorsements
feature.
By far, the splashiest effort toward boosting engagement has been a blogger platform that debuted in October, featuring prominent “influencers” from President Obama to
Richard Branson to celebrity chef Marcus Samuelsson. A JP Morgan analyst report suggested those moves have helped increase U.S. visitor growth to 11% in the fourth quarter from the prior quarter,
while page views grew 28% compared to 15% in the third quarter.
LinkedIn overall hit 200 million members worldwide in the quarter, up 39% from 2011.
Like Facebook, LinkedIn has seen a
growing shift toward use on mobile devices. A Macquarie Securities analyst noted in an earnings preview that advertising in the company’s mobile apps is still limited, “meaning that 25%
(as of 3Q and likely growing) of visiting members are currently under-monetized for ads.”
In that vein, LinkedIn CEO Jeff Weiner disclosed during the earnings conference call that
LinkedIn is testing a new ad format that allows companies to promote sponsored content in the stream of updates members see on their profile pages. It's similar to Facebook’s Promoted Posts and
Sponsored Stories or Twitter’s Promoted Tweets.
Weiner said LinkedIn has been internally testing the in-stream ads for the last few months. Last week, it began external testing with a
handful of partners on both the desktop and iPad, with smartphones to follow.
Blue-chip brands like GE, Xerox, The Economist and BlackBerry have begun serving sponsored content,
including white papers and best practices guides as status updates to their followers on the site. “What we’ve seen thus far has been encouraging, and to the extent we continue to
make progress, we’re going to roll out those same tests on a smartphone environment,” said Weiner.
He would not say when LinkedIn’s version of
native advertising would be fully rolled out, but suggested it would be sometime in the coming months. The CEO noted that 27% of unique visitors now come to the site weekly via mobile, a significant
increase from a year ago.
For the current quarter, LinkedIn has forecast revenue will range between $305 million and $310 million. The bullish outlook topped analysts’ estimate of $301
million.
LinkedIn shares were up about 10% to $136 per share in after-hours trading following the release of fourth-quarter results that topped analyst expectations.