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Many Internet companies attracted heavy attention earlier this year. The sector was seen as a revolutionary breakout in today’s all digital world. The hype faded though, and many of the most popular names have suffered a rough year to say the least. However, one company continues to remain in the Winner’s Circle on Wall Street.
LinkedIn (NYSE:LNKD), which operates the world’s largest professional network on the Internet, reported financial results for the third quarter on Thursday. Net income came in at $2.3 million (2 cents per share), compared to a net loss of $1.6 million in the same quarter last year. The company posted Non-GAAP net income of $25.1 million, or 22 cents per share, double what Wall Street was expecting.
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“LinkedIn had a strong third quarter with all of our key operating and financial metrics showing solid growth,” said Jeff Weiner, chief executive officer. “The last few months mark the most significant period of product development in the company’s history. This accelerated pace of innovation is fundamental to our goal of driving greater engagement on the LinkedIn platform.”
As the chart below shows, LinkedIn continued to grow its sales. Revenue for the third quarter was $252 million, an 81 percent jump from $139.5 million a year earlier. Although year-over-year growth has been declining from its peak made last year, the results still beat the Street consensus of $244.6 million.
The company has three main revenue streams, all of which increased from the prior year. Talent Solutions, which involves recruiting tools and represents the largest revenue source, surged 95 percent to $138.4 million. It also attracted 1,700 new customers. Marketing Solutions, LinkedIn’s ad business, gained 60 percent to reach $64 million. Meanwhile, Premium Subscriptions totaled $49.6 million, an increase of 74 percent from the third quarter of 2011.
Revenue from the United States accounted for 64 percent of total revenue. Europe, the Middle East and Africa regions made up 22 percent of total revenue.
In addition to strong financial results, LinkedIn impressed with its membership figures. The company grew its cumulative membership 43 percent to 187 million, as of the end of the third quarter. Essentially, LinkedIn generates approximately 2 member sign ups per second. In the same quarter two years ago, LinkedIn had only 81 million members.
According to comScore, LinkedIn had 110 million monthly unique visitors for the third quarter. This number excludes SlideShare, a tool that allows users to share presentations. Including SlideShare, Weiner notes that LinkedIn had 143 million unique visitors in September, making LinkedIn the 25th most visited web property in the world.
With other companies such as Facebook (NASDAQ:FB), Yahoo (NASDAQ:YHOO) and Google (NASDAQ:GOOG) targeting mobile monetization, the topic was in focus on LinkedIn’s conference call. Weiner explains, “An increasing area of focus for us is the monetization of our mobile channel, where we continue to customize our existing talent, marketing and subscription product lines to our mobile experiences. We are now showing jobs in our mobile apps, continue to test display ads on our iPad App (NASDAQ:AAPL) and are now enabling members to sign up and pay for premium subscriptions directly from their mobile devices.”
LinkedIn generated 8.9 billion page views in the third quarter, excluding mobile. Although page views have declined for the past two quarters, Weiner notes that recently introduced features on the site like a new homepage and notifications are seeing an acceleration of interaction with users.
On Friday, shares of LinkedIn jumped more than 2 percent in morning trading. Year-to-date, shares have gained about 70 percent.
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