LinkedIn Guidance Q1 2015: Don't Expect A Huge Beat

  • LinkedIn's revenue guidance for Q1 2015 implies a steep slowdown in growth and the first sequential decline in revenue.
  • LinkedIn has traditionally beaten its own guidance by about 5%.
  • If the trend continues, LinkedIn's Q1 2015 revenue should come in at $653 million.
  • LinkedIn could end up beating analyst estimates by 2.6%, compared to a 4% beat in Q4 2014.

LinkedIn Guidance Q1 2015 : Video Transcript

Hello and welcome to this videograph about LinkedIn's guidance for Q1 2015.

LinkedIn Guidance Q1 2015

As per LinkedIn's revenue guidance for Q1 2015, the company expects to deliver a revenue of 618 to 622 million dollars, growing at 31% year over year. LinkedIn's revenue guidance implies a steep slowdown in revenue growth, and projects a sequential decline in revenue, a first for the company.

LinkedIn Revenue Growth Headwinds In Q1 2015

LinkedIn (NYSE:LNKD) expects its revenue to be impacted by a slew of factors. LinkedIn will be shutting down Bizo's data business, which it acquired in mid-2014, as it integrates the business over Q1. Further, revenue is expected to be impacted by changes to LinkedIn's premium subscriptions, and volatility in foreign exchange.

LinkedIn's Revenue Guidance Track Record

However, it's important to note that LinkedIn has traditionally issued a conservative guidance, which it has beaten, quarter after quarter, for the last 2 years. Dig a little deeper, and you'll see that LinkedIn has beaten its own guidance, by 5% on average over the last 8 quarters.

LinkedIn Revenue Projection For Q1 2015

Should this trend continue, LinkedIn could end up beating its guidance, to report a revenue of $653 million. That would imply a growth of 38%, year over year, slowing compared to Q4, but not by as much as LinkedIn's guidance would suggest. As long as LinkedIn doesn't see a greater than projected impact on its revenue, it could end up beating estimates by 2.6%. However, this is lower than the 4% beat registered in Q4.

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