LINKEDIN shares fell 10 per cent yesterday after disappointing revenue forecasts suggested that a revamped mobile app and other new products designed to keep smartphone users engaged will not deliver on advertising growth as quickly as anticipated.
The social network that targets professional users and specialises in recruiting services has in past months added enhancements such as news content for mobile devices in a bid to keep users signed in longer and sell more advertising.
But yesterday executives warned that its advertising business will undergo “a more moderate growth” than its other services.
LinkedIn said net income for the first quarter rose to $22.6m (£14.5m), or 20 cents a share, from $5m, or 4 cents a share, over the same period.
Revenue in the first three months of the year rose 72 per cent to $324.7m from $188.5m in the year-ago period.
Shares of LinkedIn have surged about 74 per cent this year. The company’s recruiting services – which accounted for 57 per cent of sales – generated strong 80 per cent growth in revenue to $184.3m in the first quarter. But it said current-quarter revenue would range from $342m to $347m, below the $359.3m forecast by analysts.
Stocks slid about 10 per cent to $181 from a close of $201.67 on the New York Stock Exchange.
City A.M. Reporter