LinkedIn's net income fell in the latest quarter as the professional networking site spent more money to grow its business. But revenue grew from subscription fees and advertising grew faster than expected, and the company raised its forecast for the year.
LinkedIn's stock increased after the results came out Thursday, a reprieve after tepid news from other newly public Internet companies _ namely Facebook and Zynga. LinkedIn, which went public more than a year ago, is among the best-performing of the newly traded companies, with its stock trading at more than twice the level of its IPO price at a time when Facebook is nearing half.
The results indicate that LinkedIn is playing a greater role in the employment market as millions more people look to find jobs and network online if they do have jobs. LinkedIn said it had 174 million members at the end of the quarter, up 50 percent from a year earlier. Most of the growth in the second quarter came from overseas as LinkedIn continued to expand outside of the U.S.
LinkedIn gets more than two-thirds of its revenue from fees it charges companies, recruiting services and anyone who wants broader access to the profiles and other data on its site. The rest comes from advertising.
LinkedIn, like Facebook, is at the beginning stages of making money from its mobile applications. CEO Jeff Weiner said in a conference call with analysts that LinkedIn launched its first mobile ad test at the end of June, when large corporations such as Shell started running advertisements on LinkedIn's iPad application. He called the early signs ``positive.''
LinkedIn Corp. earned $2.8 million, or 3 cents per share, in the second quarter. That's down 38 percent from $4.5 million, or 4 cents per share, a year earlier.
Adjusted earnings, which exclude stock compensation expenses and other items, were $18.1 million, or 16 cents per share, matching analysts' expectations. Last year, LinkedIn had adjusted earnings of $10.8 million, or 10 cents per share.
Revenue increased 89 percent to $228 million, from $121 million. Analysts had expected lower revenue of $216 million, according to FactSet.
LinkedIn, which is based in Mountain View, Calif., continued to invest in its business during the quarter, hiring 414 employees to bring the total to more than 2,800 worldwide. Overall, marketing, development and other expenses increased 93 percent to $215 million, from $111 million a year earlier.
For the current quarter, LinkedIn said it expects revenue of $235 million to $240 million. Analysts were expecting $236 million.
The company raised its full-year guidance. It now expects revenue of $915 million to $925 million, up from the prior range of $880 million to $900 million. Analysts had expected $907 million.
LinkedIn's stock climbed $3.84, or 4.1 percent, to $97.35 in after-hours trading. The stock had closed down $2.13, or 2.2 percent, to $93.51.