Hiring business boosts LinkedIn revenue
31 Oct 2014
Corporate networking site LinkedIn Corp reported quarterly results that beat expectations on profit and revenue as more businesses used its services to hire staff, Reuters reported.
Hiring business at the company had been thriving as with employers finding its services increasingly helpful for assessing candidates' suitability for roles.
According to analysts, the growth is driven by expansion in the hiring business and rapid expansion in international markets, such as China, which is expected to continue in the next few quarters.
According to chief executive Jeff Weiner, in the third-quarter about 75 per cent of new members came to LinkedIn from outside the US, with China providing particular strength.
"China has become the second-largest contributor to new sign-ups on a daily basis, after only the United States," Weiner said on a conference call with analysts.
LinkedIn launched a Chinese language "beta" version of its main website in February aimed at expanding the world's largest internet market by users, as it sought to replicate its success in the US internationally.
Revenue at the network's hiring business, called Talent Solutions, was up 45 per cent in the third quarter ended 30 September, representing 61 per cent of total revenue.
Meanwhile, Weiner had been building out new products, such as a news business with sponsored updates and tools to help salespeople looking for clients, to offset slower growth in recruiting, where the market was becoming saturated.
Bloomberg quoted Dan Salmon an analyst at BMO Capital Markets, who had the equivalent of a buy rating on the stock a saying, the near-term catalysts were their emerging businesses.
He added, LinkedIn, was moving from this very narrow view that the tool was for recruiters and HR managers and people looking for jobs, to one that was driven by products built for salespeople, products built for chief marketing officers.
LinkedIn posted a third-quarter net loss of $4.26 million, or 3 cents a share, as against a net loss of $3.4 million, or 3 cents, a year earlier.
According to the company, the fourth quarter, revenue would be $600 million to $605 million. The company added profit before certain costs in the fourth quarter would be about 49 cents a share.
The site's membership in the recent period increased to 332 million, up 6.1 per cent from 313 million in the prior quarter.
In a bid to boost the amount of time members spent on the site, LinkedIn would study users' activities and intentions, with the goal of making it easier for them to find resources, according to Weiner.
