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LinkedIn Announces First Quarter 2012 Financial Results

by Jake on May 5, 2012

Mountain View, Calif. — May 3, 2012 — LinkedIn Corporation (NYSE: LNKD), the world’s largest professional network on the Internet with 161 million members, reported its financial results for the first quarter ended March 31, 2012:

  • Revenue for the first quarter was $188.5 million, an increase of 101% compared to $93.9 million in the first quarter of 2011.
  • Net income for the first quarter was $5.0 million, compared to net income of $2.1 million for the first quarter 2011.  Non-GAAP net income for the first quarter was $16.9 million, compared to $5.8 million for the first quarter of 2011.  Non-GAAP measures exclude tax-affected stock-based compensation expense and tax-affected amortization of acquired intangible assets.
  • Adjusted EBITDA for the first quarter was $38.1 million, or 20% of revenue, compared to $13.3 million for the first quarter of 2011, or 14% of revenue.
  • GAAP EPS for the first quarter was $0.04; Non-GAAP EPS for the first quarter was $0.15.

“LinkedIn’s solid performance in the first quarter built on the company’s momentum in 2011,” said Jeff Weiner, CEO of LinkedIn. “We saw strength across all key metrics from member signups and engagement to significant revenue growth across our three product lines.”

First Quarter Financial Details and Operating Summary
LinkedIn reported revenue of $188.5 million for the first quarter ended March 31, 2012, an increase of 101% compared to the first quarter of 2011, and the 7th straight quarter of greater than 100% year-over-year growth.

  • Hiring Solutions: Revenue from Hiring Solutions products totaled $102.6 million, an increase of 121% compared to the first quarter of 2011.  Hiring Solutions revenue represented 54% of total revenue in the first quarter of 2012, compared to 49% in the first quarter of 2011.
  • Marketing Solutions: Revenue from Marketing Solutions products totaled $48.0 million, an increase of 73% compared to the first quarter of 2011.  Marketing Solutions revenue represented 26% of total revenue in the first quarter of 2012, compared to 30% in the first quarter of 2011.
  • Premium Subscriptions: Revenue from Premium Subscriptions products totaled $37.9 million, an increase of 91% compared to the first quarter of 2011. Premium Subscriptions represented 20% of total revenue in the first quarter of 2012, compared to 21% of revenue in the first quarter of 2011.

Revenue from the U.S. totaled $120.8 million, and represented 64% of total revenue in the first quarter of 2012.  Revenue from international markets totaled $67.6 million, and represented 36% of total revenue in the first quarter of 2012.

Revenue from the field sales channel totaled $101.5 million, and represented 54% of total revenue in the first quarter of 2012.  Revenue from the online, direct sales channel totaled $87.0 million, and represented 46% of total revenue in the first quarter of 2012.

GAAP net income for the first quarter was $5.0 million, compared to net income of $2.1 million for the first quarter of 2011.  Non-GAAP net income for the first quarter was $16.9 million, compared to $5.8 million in the first quarter of 2011.

Adjusted EBITDA was $38.1 million for the first quarter of 2012, or 20% of revenue, compared to $13.3 million for the first quarter of 2011, or 14% of revenue.

GAAP EPS was $0.04 based on 111.3 million fully-diluted weighted shares outstanding compared to $0.00 for the first quarter of 2011 based on 51.5 million fully-diluted weighted shares outstanding.  Non-GAAP EPS was $0.15 based on 111.3 million fully-diluted weighted shares outstanding compared to $0.06 for the first quarter of 2011 based on 97.1 million fully-diluted weighted shares outstanding.

“LinkedIn grew over 100% for the seventh consecutive quarter and achieved records for adjusted EBITDA, operating and free cash flow,” said Steve Sordello, CFO of LinkedIn. “We remain focused on investing in our technology and product platform as well as expanding our business in new international markets and customer segments.”

For additional information, please see the “Selected Company Metrics and Financials” page on LinkedIn’s Investor Relations site.

First Quarter Highlights and Strategic Announcements

  • In January, LinkedIn began an early rollout of Talent Pipeline with five charter customers including PepsiCo, Pfizer, Red Hat, Netflix, and First Citizens Bank. Available to all Recruiter customers in Q2, Talent Pipeline allows recruiters and hiring managers to manage, track, and stay in touch with all their target candidates regardless of source.
  • In February, LinkedIn launched the Follow Company button for the more than two million companies with active LinkedIn company pages, making it easier for professionals to follow those companies on LinkedIn from anywhere on the web.
  • In March, LinkedIn introduced a new version of People You May Know. This new streamlined tool makes it even easier for professionals to grow their networks through a simpler, more visual user experience.
  • In the first quarter, LinkedIn continued its global growth strategy by adding two new languages (Czech and Dutch) to the LinkedIn platform, and an office in Madrid.

Business Outlook
LinkedIn is providing guidance for the second quarter of 2012, and revising guidance for the full year 2012 on revenue, adjusted EBITDA, depreciation and amortization, and stock-based compensation.

  • Q2 2012 Guidance: Revenue for the second quarter of 2012 is projected to range between $210 million to $215 million.  The company expects adjusted EBITDA to range between $40 million and $42 million.  The company expects depreciation and amortization to range between $18.5 million and $19.5 million, and stock-based compensation to range between $18 million and $19 million.
  • Full Year 2012 Guidance: The company has revised upward its expected revenue range to $880 million to $900 million from the prior range of $840 million to $860 million.  The company has also revised upward its expected adjusted EBITDA range to $170 million to $175 million from the prior range of $155 million to $165 million.  The projected range for depreciation and amortization has increased to $75 million to $85 million from $70 million to $80 million, and stock-based compensation has increased to $80 million to $90 million from $65 million to $75 million.

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