LinkedIn's Quarterly Loss Worsens, Though Revenue Grows--2nd Update
August 04 2016 - 5:10PM
Dow Jones News
By Deepa Seetharaman
Professional online network LinkedIn Corp. posted its deepest
loss as a public company, hurt by a tax-related charge, in one of
its final quarterly reports before it is set to be bought by
Microsoft Corp.
LinkedIn reported a second-quarter net loss of $119.3 million,
or 89 cents a share, compared with the year-ago loss of $67.7
million, or 53 cents a share. The loss, driven mostly by a $101
million charge related to the company's tax assets, is its worst
since becoming a public company in 2011, according to FactSet
data.
Revenue, though, also rose to the highest level in the company's
history. The Mountain View, Calif., company said revenue rose 31%,
to $932.7 million, from $711.7 million.
Excluding certain expenses, said it would have earned $1.13 a
share. Analysts, on average, had expected the company to post
earnings of 78 cents per share on that basis, according to Thomson
Reuters.
In June, Microsoft said it would buy LinkedIn for $26.2 billion
in the largest acquisition in its history. Microsoft is betting
LinkedIn can bolster the tech titan's software.
For LinkedIn, the deal offers an opportunity to reaccelerate
growth by tapping Microsoft's large customer base. It also provides
an exit for LinkedIn shareholders after the stock tumbled from a
peak of $269 in February 2015 to as low as $101.11 last February
after the company issued a disappointing outlook, which it
attributed to a slowdown in its higher-margin online sales business
and a decision to shelve an ad product.
Microsoft agreed to pay $196 per LinkedIn share, a 50% premium
to the social network's price before the deal. The stock has traded
in a tight range since then, closing Thursday at $192.01 and barely
moving after the earnings report.
LinkedIn Chief Executive Jeff Weiner will keep his current job
when the deal closes, which the companies expect to happen by the
end of the year.
About two-thirds of LinkedIn's revenue comes from its
talent-solutions division, which helps corporate recruiters
identify job candidates. The other units are its
marketing-solutions division and premium subscriptions.
Write to Deepa Seetharaman at Deepa.Seetharaman@wsj.com
(END) Dow Jones Newswires
August 04, 2016 16:55 ET (20:55 GMT)
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