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LinkedIn shares shrug off strong Q2 results, full-year revenue guidance rise

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Revenue from LinkedIn's biggest division, Talent Solutions, a platform recruiters can use to search for candidates on the site, increased 38 percent to $443.4 million. The company raised prices for its recruiting platform earlier this year.

LinkedIn (NYSE:LNKD) fell in morning trades even as the operator of the biggest social networking site for professionals lifted its full-year revenue forecast while reporting stronger-than-expected second-quarter results.

Shares of the Mountain View, California-based company fell 10 percent to $204.45 at 9:52 a.m. in New York, paring gains in the past year to 13.6 percent. 

Investor were concerned that growth was slowing in LinkedIn’s main business after the company attributed the bump in its annual revenue forecast to its acquisition of the education website Lynda.com. As part of the forecast, the company more than doubled expectations for revenue from the Lynda.com acquisition to $90 million for the year.

Net loss expanded to $67.7 million, or $0.53 loss per share, in the April-to-June quarter, from $1 million, or $0.01 loss per share.

Excluding items, the company earned $0.55 per share, above the $0.30 per share estimate of analysts surveyed by Capital IQ.

Second-quarter sales jumped 33 percent to $711.7 million, surpassing the company’s forecast for revenue of $670 million to $675 million, and the average analyst estimate of $680 million, according to Capital IQ.

LinkedIn said its Lynda.com acquisition contributed $18 million in second-quarter sales.

LinkedIn said it expects full-year revenue of about $2.94 billion, up from an earlier forecast of about $2.90 billion.

The company acquired Lynda.com for $1.5 billion while it also reorganized its sales force and changed advertising methods -- expensive moves that may take time to produce benefits. The Lynda.com purchase and LinkedIn’s efforts to promote news content are intended to make the website valuable to people even when they aren’t looking for jobs.

"We saw good progress in executing on transitions across our business," said Steve Sordello, chief financial officer of LinkedIn.

LinkedIn has been trying to make its site more mobile-friendly. In the second quarter, 52 percent of all traffic to LinkedIn came from mobile devices.

Revenue from LinkedIn's biggest division, Talent Solutions, a platform recruiters can use to search for candidates on the site, increased 38 percent to $443.4 million. The company raised prices for its recruiting platform earlier this year.

The marketing-solutions unit, which primarily sells advertising on LinkedIn properties, saw revenue rise 32 percent to $140 million. The company said its sponsored updates had a strong second quarter, more than doubling year over year.

LinkedIn also attracts about a fifth of its revenue from premium subscribers. In the second quarter, revenue in that segment rose 22 percent to $128.3 million.

 

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