LinkedIn has once again surprised analysts with its quarterly profit and revenue report. The company announced that the website’s advertising rates and sales from its services have increased to nearly double.
The company’s share price gained 8 percent to $115.15 after trading hours last Thursday following the announcement. LinkedIn has been beating forecast of analysts every quarter since the company went public last May 2011.
“They seem to be firing on all cylinders,” Tom White analyst Macquarie Research said.
“They continue to penetrate enterprises with their talent solutions business and continue to have plenty of upside opportunity there,” he added.
LinkedIn provides hiring services by connecting professionals to companies looking for workers. Revenue comes mainly from posting ads as well as providing premium subscriptions to recruiters in exchange for specialized services. While considered a networking site, it sets itself apart from Facebook and Twitter by focusing on links between employers and employees.
LinkedIn increased its forecast for one year last Thursday by estimating it to range between $939 million to $944 million. It previously forecast revenue range between $915 million to $925 million.
The site CEO Jeif Weiner, in a conference call on Thursday, revealed that LinkedIn online service has now over 187 million subscribers and that members are spending more time on the site.
“Member page views grew 44 percent, well in excess of unique visitor growth, indicating that members are becoming increasingly active on LinkedIn,” he Weiner.
The company revamped its website by introducing new features and enhancements to encourage users to spend more time on it. The site’s home page traffic has risen by 60 percent since the new features were released during the third quarter.
LinkedIn’s user engagement levels, according to analysts still fall way below if compared to Google and Facebook, limiting its advertising opportunities.
The site’s Finance Chief Steve Sordello confirmed that demands from advertisers are higher compared to LinkedIn’s current advertising inventory.
Despite that, marketing revenue rose to 60 percent to $64 million during the third quarter, boosted by an increase in advertising rates.
LinkedIn has declared a net income of $2.3 million, or 2 cents per share, during the same quarter. This is a good development compared to last year’s net loss of $1.6 million, or 2 cents per share a year ago on the same period.
Revenue during the third quarter was $252 million, or an increase of up to 81 percent, which is ahead of the analysts expectation of $244.2 million.
Talent solutions services contributed an increase of 95 percent year-on-year during the same quarter translating to $138.4 million, while the business section provided about 1,700 new customers.
The shares of the Mountain View, CA-based company closed Thursday’s trading day at $106.85.