However, the company’s net income fell as it is investing more to expand business. LinkedIn’s revenue increased faster than was expected that also led the company to raise its forecast for the entire year.
The news of increase in LinkedIn’s stock came as a relief after tepid news from other newly public Internet companies such as Facebook and Zynga.
LinkedIn went public just more than a year ago and has since then proved to be one of the best newly traded companies that performed well. The company’s stock traded at more than twice the level of its IPO.
The results clearly point out the role that LinkedIn plays in the employment market as there are millions more people, who look for jobs and network online if they do have jobs. LinkedIn revealed that it had 174 million members at the end of June, which was up by 50 percent from a year earlier. Most of the growth in the second quarter came from overseas as LinkedIn continued to expand outside U.S.
More than two-thirds of LinkedIn’s revenue is collected from fees that it charges companies, recruiting services and those who want deeper access to the profiles and other data on the site. The rest comes from advertising.
Just like Facebook, LinkedIn is also at the starting stages of making money from its mobile applications.
In a conference call with analysts, Jeff Weiner, CEO announced that LinkedIn initiated its first mobile ad test at June end. He also stated that large corporations such as Shell have started running advertisements on LinkedIn’s iPad application. Weiner believes the signs to be positive.
In the 2Q, LinkedIn Corporation earned a total of $2.8 million, or 3 cents per share. That’s down 38 percent from $4.5 million, or 4 cents per share, a year earlier.
Adjusted earnings of the company, excluding stock compensation expenses and other items, were $18.1 million, or 16 cents per share that match analysts’ expectations. Last year, LinkedIn had adjusted earnings of $10.8 million, or 10 cents per share.
Revenue of LinkedIn increased 89 percent to $228 million, from $121 million.
LinkedIn is based in Mountain View, California. The company continues to invest in its business, has hired 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.