Where does all of the above leave investors? Long term, Weiner and team will likely assimilate, solidify its workforce, get a hold on expenses, and turn the corner on improving results from its Marketing unit. With on board, and declining Marketing revenues, LinkedIn's hopes of further diversifying its revenue sources don't look promising. The problem is Talent Solutions, as of last quarter, made up 62% of LinkedIn revenues, compared to 57% in Q4. As per Weiner, is a long-term opportunity, not a near-term boost.Īdding fuel to LinkedIn's sell-off fire was news that banner ad sales were off 10%, and that decline in its Market Solutions unit is expected to continue. As per Sordello, should generate about $20 million to $25 million in sales this year. However, it doesn't appear will add much of anything to LinkedIn's top line for a long while.
#Linkedin stock 2017 professional#
The $1.5 billion deal for professional training provider will also weigh heavily on LinkedIn this year, both in increased costs and higher stock-based compensation expense. Seems like Weiner and Sordello should have seen those sales and cost hits coming. The result was more customer churn, fewer up-sells, and higher expenses associated with getting the new reps up to speed.
#Linkedin stock 2017 full#
That's surprising because of LinkedIn's sales force hiring spree - it doubled the number brought on over last year - a full 60% of its customers had a new account rep. Somewhat surprisingly, Sordello said LinkedIn underestimated the costs associated with customer acquisition. There were several factors contributing to LinkedIn's lowered guidance. Is it any wonder LinkedIn's stock price is sitting below $200 a share as of this writing? The slew of questions followed the news from Sordello that projected earnings for the year would drop from the expected $2.95 a share to $1.90, and EBITDA would be around $630 million as opposed to the $785 million it expected just a quarter ago. However, the other shoe was about to be dropped.Īfter fielding a litany of questions regarding drastic declines in projected EBITDA (earnings before interest, taxes, depreciation and amortization) and earnings the balance of 2015, it become apparent CEO Jeff Weiner and CFO Steve Sordello couldn't wait to end LinkedIn's earnings call. It was bad news surrounding LinkedIn's forecast for the remainder of the year that hit it hard, though projected revenues between $670 million and $675 million this quarter would be about a 25% jump from last year. To put that into perspective, Twitter has just 302 million MAUs and its potential user base is much more diverse than LinkedIn's targeted market of professional networkers and jobs seekers. LinkedIn also impressed with its continued member growth.Įven as social media wannabe Twitter ( TWTR 0.66%) grew its monthly average users (MAUs) an anemic 14 million last quarter, LinkedIn added another 17 million members, and now boasts 364 million. Generally, announcing a 35% jump in revenues year over year, and a 50% increase in non-GAAP (excluding one-time items) earnings-per-share, as LinkedIn did in Q1, would be cause for celebration. The question is whether LinkedIn is a compelling, long-term opportunity, or is its depressed stock warranted? Yes, there's some light at the end of the LinkedIn tunnel, but there are also serious questions that need to be addressed. Of course, for value investors, LinkedIn is an intriguing story right now. Down over 25% from pre-earnings call levels, LinkedIn performed admirably in its first quarter compared to 2014, but guidance for the balance of the year initiated a panic-ridden sell-off. Even investors that follow LinkedIn ( LNKD.DL) closely likely didn't see its precipitous stock price drop following Q1's earnings announcement coming.
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