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Exhibit
Exhibit 99.1

LinkedIn Announces First Quarter 2016 Results


MOUNTAIN VIEW, Calif., April 28, 2016 - LinkedIn Corporation (NYSE: LNKD), the world's largest professional network on the Internet, reported results for the first quarter of 2016. The transcript with prepared remarks is contained within this press release. In addition, a supplemental presentation will be made available on the investor relations section of the LinkedIn website at http://investors.linkedin.com.
“LinkedIn delivered strong financial results and growth across our core product lines,” said Jeff Weiner, CEO of LinkedIn. “As a result of our new mobile experience, members are increasing their activity on LinkedIn, helping drive strong levels of engagement across the platform."

Total revenue increased 35% year-over-year to $861 million.

Talent Solutions revenue increased 41% year-over-year to $558 million.
•
Hiring revenue contributed $502 million in revenue, up 27% year-over-year.
•
Learning & Development contributed $55 million in revenue.

Marketing Solutions revenue increased 29% year-over-year to $154 million.

Premium Subscriptions revenue increased 22% year-over-year to $149 million.

Adjusted EBITDA was $222 million, or 26% of revenue.

GAAP net loss attributable to common stockholders was $46 million and non-GAAP net income was $99 million.

GAAP diluted EPS was $(0.35), compared to last year's performance of $(0.34). Non-GAAP diluted EPS was $0.74, compared to $0.57 last year.

"We are off to a good start in 2016 with strength in our core and emerging businesses," said Steve Sordello, CFO of LinkedIn. "We continue to invest heavily in innovation and in our core products, while at the same time driving focus and scale to enable growth and leverage across the business."

Business Outlook

LinkedIn is providing guidance for the second quarter and full year 2016. Further details are in the transcript below and a supplemental presentation will be made available on the investor relations section of our website at http://investors.linkedin.com:

•
Q2 2016 Guidance: Revenue is expected to range between $885 million and $890 million. Adjusted EBITDA is expected to range between $225 million and $230 million. Non-GAAP EPS is expected to range between $0.74 and $0.77. The company expects depreciation of approximately $93 million, amortization of approximately $44 million, and stock-based compensation of approximately $150 million. The company also expects approximately 134 million GAAP fully-diluted weighted shares and 136 million non-GAAP fully-diluted weighted shares.

•
Full Year 2016 Guidance: Revenue is expected to range between $3.65 billion and $3.70 billion. Adjusted EBITDA is expected to range between $985 million and $1.005 billion. Non-GAAP EPS is expected to range between $3.30 and $3.40. The company expects depreciation of approximately $395 million, amortization of approximately $173 million, and stock-based compensation of approximately $580 million. The company also expects approximately 135 million GAAP fully-diluted weighted shares and 136 million non-GAAP fully-diluted weighted shares.

Prepared Remarks — Jeff Weiner, CEO LinkedIn Corporation

Q1 was a strong start to the year as LinkedIn once again delivered results that exceeded our plan. I want to highlight three key themes from the quarter. First, engagement materially strengthened across our member


platform, driven by our new flagship experience. Second, our core monetization products — Recruiter and Sponsored Updates — showed continued growth, while our emerging strategic investments such as Sales Navigator and Learning & Development continue to show progress. And third, we saw significant improvements in our ability to increase ROI across the business.

For Q1, overall revenues grew 35% to $861 million. We delivered adjusted EBITDA of $222 million, and non-GAAP EPS of $0.74 cents.

In the quarter, cumulative members grew 19% to 433 million, our strongest net-add quarter since the beginning of 2014. Our core operating metrics saw accelerated growth — unique visiting members grew 9% to an average of 106 million members a month and member page views grew 34%. Page views per unique visiting member hit an all-time high in Q1, with 23% year-over-year growth.

Q1 marked the first full quarter for our new mobile flagship experience, and we are pleased with the performance thus far. Members are engaging at record levels with the more relevant and comprehensive feed. During the quarter, viral actions increased more than 80%, daily shares were up nearly 40%, and traffic to third-party publishers grew more than 150%. We also continue to see significant growth in other core engagement metrics, such as profile edits, connections made, and messages sent.

Additionally, we saw record levels of activity in our jobs products. Total jobs unique visitors hit a record high in Q1, up more than 20% versus last year. Job applicants from our mobile flagship app also reached record highs, up more than 50%.

As job seekers find more value on LinkedIn, our hiring business directly benefits.

For Talent Solutions, in Q1 we strengthened our core Recruiter product while also laying the groundwork for the roll-out of a number of emerging growth drivers.

The next generation of Recruiter, unveiled late last year, is the foundation of our long-term growth strategy. Recruiters are experiencing greater success with the new product, and effectiveness has increased substantially. Currently, the number of candidates viewed per search is up more than 40%, and InMails per search are up more than 30%. By the end of Q2, we expect the majority of our customers to have converted to the new version of Recruiter.

Additionally, newer products such as Referrals and Connectifier are coming online to help customers drive a greater share of hiring through LinkedIn. And the increased member engagement with jobs is already delivering a stronger pipeline of potential candidates to our existing customers.

In Marketing Solutions, our re-doubled focus on Sponsored Content is already paying dividends. In Q1, Sponsored Content grew nearly 80%, now representing 56% of total Marketing Solutions revenue. On top of greater demand, increased feed engagement resulted in more opportunities for marketers to reach their target audiences. We also began piloting the sale of sponsored content through off network inventory.

Additionally, by virtue of leveraging our LinkedIn Lead Accelerator team and technology, conversion tracking and enhanced campaign analytics are coming online faster than we expected. By the end of 2016, we anticipate a Sponsored Content customer will be able to expand targeting using their own data such as customer account lists, use conversion tracking to better measure their return on investment, and leverage improved tools including APIs to better manage their campaigns, all of which will ultimately drive even higher ROI.

In addition to our core businesses, Sales Solutions and Learning & Development represent two longer-term focus areas. For Sales Solutions, we continue to focus on enhancing Sales Navigator to become the primary system of engagement for sales professionals. During the quarter, we continued to make good progress simplifying the integration with CRM systems, enabling seat holders to see more value faster. We also remain focused working with customers globally to help measure and drive their ROI. For example, Sales Navigator influenced $350 million in closed business at HCL, a global business services firm, demonstrating the significant potential of social selling. Regarding Learning & Development, we are now turning our attention from integrating the Lynda.com team, to integrating their technology and content. Two examples are the launch of LinkedIn Learning Paths, aggregating relevant content from across LinkedIn relating to a specific topic or course, and


testing deeper integration into relevant LinkedIn subscription packages. On the enterprise side, we continue to build out the comprehensiveness of our content library to meet the growing demand from our corporate customers.

In closing, Q1 represented a strong quarter for both our member platform and business lines, with increasing engagement via our Flagship app strengthening the foundation for continued growth across our diverse enterprise offerings. At the same time, we remain focused on long-term profitability by driving greater leverage and ROI across our entire portfolio.

Lastly, I want to thank all of our employees, who have continued to make this possible while embodying our culture and values.

I'll now turn it over to Steve for a deeper dive into our operating metrics and financials.

Prepared Remarks — Steve Sordello, CFO LinkedIn Corporation

We achieved strong performance during the quarter, underscoring progress across member engagement, and in our core and emerging businesses. We also improved the return on our investment, as revenue growth was accompanied by an increase in adjusted EBITDA margin year-over-year.
 
With respect to revenue, in Q1 we generated $861 million in total sales, growth of 35% year-over-year, or 38% on a constant currency basis.
 
Talent Solutions revenue, comprised of Hiring and Learning & Development increased to $558 million up 41% year-over-year, and represented 65% of sales versus 62% last year.
 
Within Hiring, revenue grew 27% year-over-year, or 30% on a constant currency basis.

For field sales, we’re encouraged by solid fundamentals:
•
Existing customers continue to grow their spend with LinkedIn:
•
Larger enterprises represent approximately 70% of customer spend, and we’ve seen healthy growth over the past couple years in existing customer spending. We also continued to see engagement increase across our product suite, as measured by jobs posted, job applications, and inMails sent.
•
In addition, we saw a better than expected impact from pricing, while churn levels were consistent with last year, helping maintain per customer spending growth.
•
For new customers, growth remained strong as we added a healthy level of new accounts, with modest acceleration in large enterprise customer additions.

Our online channel, composed of online jobs and subscription products for individual job seekers and recruiters, benefited from two factors.
•
First, new subscribers continued shifting to Job Seeker and Recruiter Lite from Premium Subscriptions. This shift dates back to the Q4’14 subscriber on-boarding changes, which we will begin to lap in the 2nd half of 2016.
•
More importantly, we saw a positive impact from increased engagement and product improvements.
 
Learning & Development continues to be an area of longer-term focus, and contributed $55 million during the quarter. Important initiatives in 2016 include integrating learning content into the LinkedIn platform, and beginning to grow our enterprise effort, given the building early demand with corporate customers.

Marketing Solutions increased 29% to $154 million, or 31% on a constant currency basis, and represented 18% of revenue versus 19% last year.
•
Sponsored Content continued its strong performance, growing nearly 80% in the quarter. Product improvements drove significant improvements in click through, resulting in increased ROI for customers. Growth in delivered impressions came from greater feed engagement and strong customer demand.
•
Sponsored Content strength also helped ease the secular transition from display. As expected, Premium Display declined approximately 30%, and now represents roughly 10% of overall Marketing


Solutions. As mentioned last quarter, we are testing programmatic sales in right-rail inventory, an area we will continue to explore throughout 2016.
•
The decision to focus primarily on Sponsored Content began to payoff in the first quarter, and we’ll continue to focus our investment to better integrate the Lead Accelerator technology into the Sponsored Content platform.
 
Premium Subscriptions grew to $149 million up 22% year-over-year, or 25% growth on a constant currency basis, and contributed 17% of revenue versus 19% last year.
•
Sales Solutions grew approximately 55% year-over-year, and now represents 40% of Premium Subscription revenue.
•
The Field channel is growing substantially faster than individual online subscriptions, and enterprise customers continue to see increased value in Sales Navigator. Within these customers, high product satisfaction and lower churn give us conviction in the future potential of this business.

The remainder of Premium Subscriptions comes from our General Subscriptions SKU.
•
This product grew approximately 7% year-over-year, muted in part by the previously discussed changes in subscriber on-boarding.
•
Looking across the four individual subscription products on the LinkedIn platform (Gen Subs, Job Seeker, Recruiter Lite, and Sales Navigator), we saw healthy growth in the 20% range in the first quarter.
  
In terms of geography, non-US sales represented 39% of overall revenue, consistent with last year, or 41% on a constant currency basis. We saw better than expected results in EMEA across all of our product lines. By channel, field sales contributed 62% of revenue, consistent with last year.
 
Moving to the non-GAAP financials, adjusted EBITDA was $222 million, a 26% margin.
 
Depreciation was $95 million, amortization of intangibles was $47 million, and stock compensation totaled $146 million.
 
GAAP net loss was $46 million, resulting in a $0.35 cent loss per share, compared to loss of $43 million and $0.34 cent loss per share last year.
 
Non-GAAP net income was $99 million, resulting in earnings of $0.74 cents per share, compared with $73 million and $0.57 cents last year.
 
The balance sheet remains well positioned with $3.2 billion of cash and marketable securities. Operating cash flow was a record $252 million versus $165 million a year ago, and free cash flow was $75 million in light of our continued investments in data centers and facilities.

With respect to capex, we expect to see increased leverage beginning in 2017 as we exit what has been a period of strategic investment in data centers and facilities to support our long-term growth.
•
In terms of data centers, we will complete building out the majority of our global footprint by the end of 2016, on track with the plan we originally discussed in 2014. We have begun to realize improved reliability and increased site speed, made possible by our new self-managed infrastructure. We will also improve our cost structure given that we expect to realize greater than 40% in future opex savings within cost of revenue.
•
For facilities, we have executed on a plan that aligns our global office footprint with our long-term business needs and we plan to exit our growth investment cycle in late 2017.

Turning to guidance, I will end the call with our outlook for the second quarter and updated view of the full year.
 
For the second quarter, we expect:
•
Revenue of approximately $885-890 million, representing approximately 25% percent growth.
•
Adjusted EBITDA of between $225-230 million, a 26% margin.
•
Non-GAAP EPS of between $0.74 -$0.77 cents per share.
 
For the full year, we’ve increased our outlook and now expect:


•
Revenue between $3.65 and $3.70 billion, a range of 22% to 24% year-over-year growth.
•
Adjusted EBITDA of approximately $985 million - $1.005 billion, a 27% margin.
•
And non-GAAP EPS of approximately $3.30 to $3.40 per share.
•
For stock-based compensation, our 2016 equity grant will result in 100 basis points of GAAP margin expansion this year vs prior guidance. Overall, stock compensation is an area of focus and we expect to see continued progress towards lowering this expense as a percentage of revenue going forward.
•
For 2016, we expect approximately $150 million for Q2 and $580 million for the full year.
•
Depreciation of approximately $93 million for Q2 and $395 million for the full year, with second quarter amortization of approximately $44 million and $173 million for the full year.
•
For other expenses, on a non-GAAP basis we expect approximately $2 million for Q2 and $4 million for the full year. On a GAAP basis, we expect $16 million for the second quarter, and $63 million for the full year; this includes GAAP-only convertible accretion expenses and the impact from the financial derivative related to our Chinese JV.
•
A non-GAAP tax rate of 23% for Q2 and for the full year.
•
Also as it relates to tax, as mentioned last quarter, we expect to take a GAAP charge of approximately $100 million in the second quarter of 2016, the result of a valuation allowance against our deferred tax assets. As this is a non-cash charge, this will not impact our non-GAAP results.
•
And for the share count:
•
On a GAAP basis, we expect 134 million fully diluted weighted shares in Q2, and an average of 135 million for the full year.
•
On a non-GAAP basis, we expect 136 million fully diluted weighted shares in Q2 and for the full year.

In closing, we are off to a good start to 2016. We have building momentum in member engagement, achieved solid results in our core and emerging businesses, and generated strong adjusted EBITDA and record operating cash flow. Finally, we are positioned to create greater leverage through increasing profitability and growing free cash flow.

As we invest for the long term, we will continue to pursue the realization of our mission while focusing on capturing the large and growing opportunity ahead of us.

 









LINKEDIN CORPORATION
TRENDED CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited) 
 
As of
 
March 31,
2015
 
June 30,
2015
 
September 30,
2015
 
December 31,
2015
 
March 31, 2016
ASSETS
 
 
 
 
 
 
 
 
 
CURRENT ASSETS:
 
 
 
 
 
 
 
 
 
     Cash and cash equivalents
$
1,017,287

 
$
450,991

 
$
631,725

 
$
546,237

 
$
759,451

     Marketable securities
2,512,588

 
2,582,435

 
2,457,607

 
2,573,145

 
2,400,187

     Accounts receivable
424,787

 
449,500

 
457,975

 
603,060

 
582,726

     Deferred commissions
60,259

 
58,585

 
56,453

 
87,706

 
80,783

     Prepaid expenses
62,800

 
75,669

 
72,752

 
62,992

 
76,414

     Other current assets
141,798

 
118,718

 
136,225

 
61,949

 
68,835

          Total current assets
4,219,519

 
3,735,898

 
3,812,737

 
3,935,089

 
3,968,396

     Property and equipment, net
755,396

 
793,034

 
906,189

 
1,047,005

 
1,139,032

     Goodwill
359,739

 
1,492,972

 
1,508,946

 
1,507,093

 
1,597,268

     Intangible assets, net
122,826

 
456,233

 
418,050

 
373,087

 
334,048

     Other assets
80,684

 
78,645

 
70,788

 
148,925

 
170,623

TOTAL ASSETS
$
5,538,164

 
$
6,556,782

 
$
6,716,710

 
$
7,011,199

 
$
7,209,367

 
 
 
 
 
 
 
 
 
 
LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST, AND STOCKHOLDERS’ EQUITY
 
 
 
 
 
 
 
 
 
CURRENT LIABILITIES:
 
 
 
 
 
 
 
 
 
     Accounts payable
$
85,104

 
$
109,715

 
$
123,329

 
$
162,176

 
$
161,523

     Accrued liabilities
206,826

 
256,958

 
296,794

 
316,792

 
257,371

     Deferred revenue
585,812

 
629,671

 
621,411

 
709,116

 
787,621

          Total current liabilities
877,742

 
996,344

 
1,041,534

 
1,188,084

 
1,206,515

CONVERTIBLE SENIOR NOTES, NET
1,092,715

 
1,104,010

 
1,115,439

 
1,126,534

 
1,138,264

OTHER LONG-TERM LIABILITIES
146,504

 
238,001

 
241,532

 
201,128

 
225,023

          Total liabilities
2,116,961

 
2,338,355

 
2,398,505

 
2,515,746

 
2,569,802

COMMITMENTS AND CONTINGENCIES
 
 
 
 
 
 
 
 
 
REDEEMABLE NONCONTROLLING INTEREST
5,536

 
25,784

 
26,296

 
26,810

 
27,321

STOCKHOLDERS’ EQUITY:
 
 
 
 
 
 
 
 
 
     Class A and Class B common stock
13

 
13

 
13

 
13

 
13

     Additional paid-in capital
3,420,045

 
4,268,731

 
4,405,911

 
4,588,578

 
4,779,628

 Accumulated other comprehensive income (loss)
1,085

 
(2,877
)
 
6,632

 
9,124

 
7,502

     Accumulated deficit
(5,476
)
 
(73,224
)
 
(120,647
)
 
(129,072
)
 
(174,899
)
          Total stockholders’ equity
3,415,667

 
4,192,643

 
4,291,909

 
4,468,643

 
4,612,244

TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST, AND STOCKHOLDERS’ EQUITY
$
5,538,164

 
$
6,556,782

 
$
6,716,710

 
$
7,011,199

 
$
7,209,367





LINKEDIN CORPORATION
TRENDED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited) 
 
Three Months Ended
 
March 31,
2015
 
June 30,
2015
 
September 30,
2015
 
December 31,
2015
 
March 31, 2016
 
 
 
 
 
 
 
 
 
 
Net revenue
$
637,687

 
$
711,735

 
$
779,595

 
$
861,894

 
$
860,650

Costs and expenses:
 
 
 
 
 
 
 
 
 
Cost of revenue (exclusive of depreciation and amortization shown separately below)
88,406

 
100,086

 
111,368

 
118,998

 
117,528

Sales and marketing
229,636

 
261,271

 
265,454

 
291,768

 
301,786

Product development
165,580

 
190,133

 
202,682

 
217,265

 
237,620

General and administrative
97,313

 
142,389

 
118,871

 
120,161

 
127,650

Depreciation and amortization
73,972

 
99,004

 
117,901

 
129,595

 
142,285

          Total costs and expenses
654,907

 
792,883

 
816,276

 
877,787

 
926,869

Loss from operations
(17,220
)
 
(81,148
)
 
(36,681
)
 
(15,893
)
 
(66,219
)
Other expense, net:
 
 
 
 
 
 
 
 
 
Interest income
1,985

 
2,017

 
2,798

 
3,771

 
4,973

Interest expense
(12,597
)
 
(12,694
)
 
(12,773
)
 
(12,818
)
 
(12,841
)
Other, net
(4,035
)
 
(1,723
)
 
(10,684
)
 
(7,035
)
 
(4,190
)
Other expense, net
(14,647
)
 
(12,400
)
 
(20,659
)
 
(16,082
)
 
(12,058
)
Loss before income taxes
(31,867
)
 
(93,548
)
 
(57,340
)
 
(31,975
)
 
(78,277
)
Provision (benefit) for income taxes
10,572

 
(26,048
)
 
(10,429
)
 
(24,064
)
 
(32,961
)
Net loss
(42,439
)
 
(67,500
)
 
(46,911
)
 
(7,911
)
 
(45,316
)
Accretion of redeemable noncontrolling interest
(109
)
 
(248
)
 
(512
)
 
(514
)
 
(511
)
Net loss attributable to common stockholders
$
(42,548
)
 
$
(67,748
)
 
$
(47,423
)
 
$
(8,425
)
 
$
(45,827
)
Net loss per share attributable to common stockholders:
 
 
 
 
 
 
 
 
 
     Basic
$
(0.34
)
 
$
(0.53
)
 
$
(0.36
)
 
$
(0.06
)
 
$
(0.35
)
     Diluted
$
(0.34
)
 
$
(0.53
)
 
$
(0.36
)
 
$
(0.06
)
 
$
(0.35
)
Weighted-average shares used to compute net loss per share attributable to common stockholders:
 
 
 
 
 
 
 
 
 
     Basic
125,471

 
128,241

 
130,716

 
131,583

 
132,779

     Diluted
125,471

 
128,241

 
130,716

 
131,583

 
132,779






LINKEDIN CORPORATION
TRENDED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited) 
 
Three Months Ended
 
March 31,
2015
 
June 30,
2015
 
September 30,
2015
 
December 31,
2015
 
March 31, 2016
 
 
 
 
 
 
 
 
 
 
OPERATING ACTIVITIES:
 
 
 
 
 
 
 
 
 
Net loss
$
(42,439
)
 
$
(67,500
)
 
$
(46,911
)
 
$
(7,911
)
 
$
(45,316
)
Adjustments to reconcile net loss to net cash provided by operating activities:
 
 
 
 
 
 
 
 
 
Depreciation and amortization
73,972

 
99,004

 
117,901

 
129,595

 
142,285

Provision for doubtful accounts and sales returns
1,795

 
3,280

 
3,373

 
4,269

 
7,746

Amortization of investment premiums, net
5,514

 
5,001

 
5,362

 
4,457

 
4,160

Amortization of debt discount and transaction costs
11,189

 
11,322

 
11,456

 
11,592

 
11,730

Stock-based compensation
103,109

 
145,491

 
126,874

 
134,800

 
146,104

Excess income tax benefit from stock-based compensation
(18,198
)
 
18,198

 
1,726

 
(13,965
)
 
(1,698
)
Changes in operating assets and liabilities:
 
 
 
 
 
 
 
 
 
Accounts receivable
29,489

 
(21,887
)
 
(9,168
)
 
(147,895
)
 
11,932

Deferred commissions
7,067

 
1,535

 
3,094

 
(38,204
)
 
8,844

Prepaid expenses and other assets
(34,629
)
 
(1,957
)
 
(9,568
)
 
(11,865
)
 
(29,495
)
Accounts payable and other liabilities
(40,725
)
 
55,959

 
58,854

 
26,838

 
(45,086
)
Income taxes, net
5,629

 
(22,876
)
 
(15,659
)
 
(3,373
)
 
(34,998
)
Deferred revenue
63,359

 
72

 
(7,739
)
 
88,268

 
75,979

Net cash provided by operating activities
165,132

 
225,642

 
239,595

 
176,606

 
252,187

INVESTING ACTIVITIES:
 
 
 
 
 
 
 
 
 
Purchases of property and equipment
(90,121
)
 
(72,462
)
 
(166,653
)
 
(178,010
)
 
(177,480
)
Purchases of investments
(454,281
)
 
(632,774
)
 
(809,448
)
 
(915,977
)
 
(465,424
)
Sales of investments
438,409

 
141,452

 
391,914

 
268,727

 
168,434

Maturities of investments
482,840

 
417,115

 
536,891

 
521,548

 
470,456

Payments for intangible assets and acquisitions, net of cash acquired
(4,161
)
 
(650,681
)
 
(20,030
)
 
(2,975
)
 
(40,430
)
Changes in deposits and restricted cash
(1,382
)
 
(1,877
)
 
10,461

 
(602
)
 
3,025

Net cash provided by (used in) investing activities
371,304

 
(799,227
)
 
(56,865
)
 
(307,289
)
 
(41,419
)
FINANCING ACTIVITIES:
 
 
 
 
 
 
 
 
 
Net cash provided by financing activities
26,739

 
3,364

 
1,255

 
46,456

 
125

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS
(6,775
)
 
3,925

 
(3,251
)
 
(1,261
)
 
2,321

CHANGE IN CASH AND CASH EQUIVALENTS
556,400

 
(566,296
)
 
180,734

 
(85,488
)
 
213,214

CASH AND CASH EQUIVALENTS—Beginning of period
460,887

 
1,017,287

 
450,991

 
631,725

 
546,237

CASH AND CASH EQUIVALENTS—End of period
$
1,017,287

 
$
450,991

 
$
631,725

 
$
546,237

 
$
759,451




LINKEDIN CORPORATION
TRENDED SUPPLEMENTAL REVENUE INFORMATION
(In thousands)
(Unaudited) 
 
Three Months Ended
 
March 31,
2015
 
June 30,
2015
 
September 30,
2015
 
December 31,
2015
 
March 31, 2016
 
 
 
 
 
 
 
 
 
 
Revenue by product:
 
 
 
 
 
 
 
 
 
     Talent Solutions
 
 
 
 
 
 
 
 
 
          Hiring
$
396,375

 
$
425,812

 
$
460,838

 
$
486,746

 
$
502,391

          Learning & Development
—

 
17,558

 
41,273

 
48,593

 
55,256

     Total Talent Solutions
396,375

 
443,370

 
502,111

 
535,339

 
557,647

     Marketing Solutions
119,192

 
140,037

 
139,549

 
182,550

 
154,147

     Premium Subscriptions
122,120

 
128,328

 
137,935

 
144,005

 
148,856

Total
$
637,687

 
$
711,735

 
$
779,595

 
$
861,894

 
$
860,650

 
 
 
 
 
 
 
 
 
 
Revenue by geographic region:
 
 
 
 
 
 
 
 
 
     United States
$
389,258

 
$
444,531

 
$
484,300

 
$
527,719

 
$
526,416

     International
 
 
 
 
 
 
 
 
 
          Other Americas (1)
38,066

 
39,904

 
43,505

 
46,500

 
45,362

          EMEA (2)
156,563

 
168,771

 
187,286

 
217,624

 
217,601

          APAC (3)
53,800

 
58,529

 
64,504

 
70,051

 
71,271

Total International revenue
248,429

 
267,204

 
295,295

 
334,175

 
334,234

 
 
 
 
 
 
 
 
 
 
                         Total revenue
$
637,687

 
$
711,735

 
$
779,595

 
$
861,894

 
$
860,650

 
 
 
 
 
 
 
 
 
 
Revenue by geography, by product:
 
 
 
 
 
 
 
 
 
United States
 
 
 
 
 
 
 
 
 
          Talent Solutions
$
240,752

 
$
277,772

 
$
309,935

 
$
328,772

 
$
341,534

          Marketing Solutions
77,412

 
91,761

 
93,362

 
114,955

 
98,361

          Premium Subscriptions
71,094

 
74,998

 
81,003

 
83,992

 
86,521

Total United States revenue
$
389,258

 
$
444,531

 
$
484,300

 
$
527,719

 
$
526,416

     International
 
 
 
 
 
 
 
 
 
          Talent Solutions
155,623

 
165,598

 
192,176

 
206,567

 
216,113

          Marketing Solutions
41,780

 
48,276

 
46,187

 
67,595

 
55,786

          Premium Subscriptions
51,026

 
53,330

 
56,932

 
60,013

 
62,335

Total International revenue
$
248,429

 
$
267,204

 
$
295,295

 
$
334,175

 
$
334,234

 
 
 
 
 
 
 
 
 
 
                         Total revenue
$
637,687

 
$
711,735

 
$
779,595

 
$
861,894

 
$
860,650

 
 
 
 
 
 
 
 
 
 
Revenue by channel:
 
 
 
 
 
 
 
 
 
     Field sales
$
393,251

 
$
440,476

 
$
479,547

 
$
551,279

 
$
535,957

     Online sales
244,436

 
271,259

 
300,048

 
310,615

 
324,693

          Total
$
637,687

 
$
711,735

 
$
779,595

 
$
861,894

 
$
860,650

______________
 
 
 
 
 
 
 
 
 
(1) Canada, Latin America and South America
(2) Europe, the Middle East and Africa (“EMEA”)
(3) Asia-Pacific (“APAC”)



LINKEDIN CORPORATION
TRENDED RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(In thousands, except per share data)
(Unaudited) 
 
Three Months Ended
 
March 31,
2015
 
June 30,
2015
 
September 30,
2015
 
December 31,
2015
 
March 31, 2016
 
 
 
 
 
 
 
 
 
 
Non-GAAP net income and net income per share:
 
 
 
 
 
 
 
 
 
GAAP net loss attributable to common stockholders
$
(42,548
)
 
$
(67,748
)
 
$
(47,423
)
 
$
(8,425
)
 
$
(45,827
)
Add back: stock-based compensation
103,109

 
145,491

 
126,874

 
134,800

 
146,104

Add back: non-cash interest expense related to convertible senior notes
11,189

 
11,322

 
11,456

 
11,592

 
11,730

Add back: amortization of intangible assets
11,778

 
29,474

 
46,466

 
46,989

 
47,323

Add back: accretion of redeemable noncontrolling interest
109

 
248

 
512

 
514

 
511

Add back: fair value adjustment on other derivative
—

 
—

 
6,900

 
1,900

 
2,300

Income tax effects and adjustments (1)
(11,096
)
 
(47,378
)
 
(41,331
)
 
(61,624
)
 
(62,672
)
NON-GAAP NET INCOME
$
72,541

 
$
71,409

 
$
103,454

 
$
125,746

 
$
99,469

 
 
 
 
 
 
 
 
 
 
  GAAP diluted shares
125,471

 
128,241

 
130,716

 
131,583

 
132,779

Add back: dilutive shares under the treasury stock method
2,827

 
2,224

 
1,825

 
2,020

 
1,259

   NON-GAAP DILUTED SHARES
128,298

 
130,465

 
132,541

 
133,603

 
134,038

 
 
 
 
 
 
 
 
 
 
NON-GAAP DILUTED NET INCOME PER SHARE
$
0.57

 
$
0.55

 
$
0.78

 
$
0.94

 
$
0.74

 
 
 
 
 
 
 
 
 
 
Adjusted EBITDA:
 
 
 
 
 
 
 
 
 
   Net loss
$
(42,439
)
 
$
(67,500
)
 
$
(46,911
)
 
$
(7,911
)
 
$
(45,316
)
   Provision (benefit) for income taxes
10,572

 
(26,048
)
 
(10,429
)
 
(24,064
)
 
(32,961
)
   Other expense, net
14,647

 
12,400

 
20,659

 
16,082

 
12,058

   Depreciation and amortization
73,972

 
99,004

 
117,901

 
129,595

 
142,285

   Stock-based compensation
103,109

 
145,491

 
126,874

 
134,800

 
146,104

ADJUSTED EBITDA
$
159,861

 
$
163,347

 
$
208,094

 
$
248,502

 
$
222,170

______________
 
 
 
 
 
 
 
 
 
(1) Excludes accretion of redeemable noncontrolling interest.






Quarterly Results Webcast and Conference Call

LinkedIn will host a webcast and conference call to discuss its first quarter 2016 financial results and business outlook today at 2:00 p.m. Pacific Time. Jeff Weiner and Steve Sordello will host the webcast, which can be viewed on the investor relations section of the LinkedIn website at http://investors.linkedin.com/. This call will contain forward-looking statements and other material information regarding the company's financial and operating results. Following completion of the call, a recorded replay of the webcast will be available on our website.

Upcoming Events

Management will participate in upcoming financial Q&A discussions at industry events on May 10th, May 24th, and June 6th. LinkedIn will post a link to these events on its investor relations website,
http://investors.linkedin.com/ for both the live and archived webcasts.

About LinkedIn 

LinkedIn connects the world’s professionals to make them more productive and successful and transforms the ways companies hire, market, and sell. Our vision is to create economic opportunity for every member of the global workforce through the ongoing development of the world’s first Economic Graph. LinkedIn has offices around the world.

Non-GAAP Financial Measures
To supplement its condensed consolidated financial statements, which are prepared and presented in accordance with US GAAP, the company uses the following non-GAAP financial measures: adjusted EBITDA, non-GAAP net income, and non-GAAP diluted EPS (collectively the “non-GAAP financial measures”). The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with US GAAP. The company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The company believes that they provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.

The company excludes the following items from one or more of its non-GAAP measures:

Stock-based compensation. The company excludes stock-based compensation because it is non-cash in nature and because the company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operational performance and liquidity. The company further believes this measure is useful to investors in that it allows for greater transparency to certain line items in its financial statements and facilitates comparisons to peer operating results.

Non-cash interest expense related to convertible senior notes. In November 2014, the company issued $1.3 billion aggregate principal amount of 0.50% convertible senior notes. In accordance with GAAP, the company separately accounted for the value of the conversion feature as a debt discount, which is amortized in a manner that reflects the company’s non-convertible debt borrowing rate. Accordingly, the company recognizes imputed interest expense on its convertible senior notes of approximately 4.7% in its statement of operations. The company excludes the difference between the imputed interest expense and coupon interest expense, net of any capitalized interest, because it is non-cash in nature and because the company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operational performance and liquidity. In addition, excluding this item from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peer operating results.

Amortization of acquired intangible assets. The company excludes amortization of acquired intangible assets because it is non-cash in nature and because the company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operational performance and liquidity. In addition, excluding this item from the non-GAAP measures facilitates comparisons to historical operating results and comparisons to peer operating results.



Accretion of redeemable noncontrolling interest. The accretion of redeemable noncontrolling interest represents the accretion of the company's redeemable noncontrolling interest to its redemption value. The company excludes the accretion because it is non-cash in nature and because the company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operating performance. In addition, excluding this item from the non-GAAP financial measures facilitates comparisons to historical operating results and comparisons to peer operating results.

Fair value adjustment on other derivative. These adjustments represent the changes in fair value of the cash settlement feature for the preferred shares in the company's joint venture. The company excludes these fair value adjustments because they are non-cash in nature and the company believes that the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding operating performance. In addition, excluding this item from the non-GAAP financial measures facilitates comparisons to historical operating results and comparisons to peer operating results.

Income tax effects and adjustments. The company adjusts non-GAAP net income by considering the income tax effects of excluding stock-based compensation and the amortization of acquired intangible assets. The company uses a static non-GAAP tax rate for evaluating its operating performance as well as for planning and forecasting purposes. This projected 10-year weighted average non-GAAP tax rate eliminates the effects of non-recurring and period specific items, which can vary in size and frequency and does not necessarily reflect the company's long-term operations. Based on the company's current forecast, a tax rate of 23% has been applied to its non-GAAP financial results for the current period. This rate will be adjusted annually, if necessary. The company believes that adjusting for these income tax effects and adjustments provides additional transparency to the overall or “after tax” effects of excluding these items from its non-GAAP net income.

Dilutive shares under the treasury stock method. During periods with a net loss, the company excludes certain potential common shares from its GAAP diluted shares because their effect would have been anti-dilutive. On a non-GAAP basis, these shares would have been dilutive. As a result, the company has included the impact of these shares in the calculation of its non-GAAP diluted net income per share under the treasury stock method.

For more information on the non-GAAP financial measures, please see the “Trended Reconciliation of GAAP to Non-GAAP Financial Measures” table in this press release. This accompanying table has more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. Additionally, the company has not reconciled adjusted EBITDA or non-GAAP EPS guidance to net loss or GAAP EPS guidance because it does not provide guidance for either other income (expense), net, or GAAP provision for income taxes, which are reconciling items between net loss and adjusted EBITDA and non-GAAP EPS. As items that impact net loss are out of the company's control and/or cannot be reasonably predicted, the company is unable to provide such guidance. Accordingly, a reconciliation to net loss is not available without unreasonable effort.

Safe Harbor Statement

“Safe Harbor” statement under the Private Securities Litigation Reform Act of 1995: This press release and the accompanying conference call contain forward-looking statements about our products, including our investments in products, technology and other key strategic areas, certain non-financial metrics, such as member growth and engagement, and our expected financial metrics such as revenue, adjusted EBITDA, non-GAAP EPS, depreciation and amortization, stock-based compensation and fully-diluted weighted shares for the second quarter of 2016 and the full fiscal year 2016. The achievement of the matters covered by such forward-looking statements involves risks, uncertainties and assumptions. If any of these risks or uncertainties materialize or if any of the assumptions prove incorrect, the company’s results could differ materially from the results expressed or implied by the forward-looking statements the company makes.

The risks and uncertainties referred to above include - but are not limited to - our core value of putting members first, which may conflict with the short-term interests of the business; engagement of our members; the price volatility of our Class A common stock; general economic conditions; expectations regarding the return on our strategic investments; execution of our plans and strategies, including with respect to mobile products and features and expansion into new areas and businesses; security measures and the risk that they may not be sufficient to secure our member data adequately or that we are subject to attacks that degrade or deny the ability of members to access our solutions; expectations regarding our ability to timely and effectively scale and


adapt existing technology and network infrastructure to ensure that our solutions are accessible at all times with short or no perceptible load times; our ability to maintain our rate of revenue growth and manage our expenses and investment plans; our ability to accurately track our key metrics internally; members and customers curtailing or ceasing to use our solutions; privacy, security and data transfer concerns, as well as changes in regulations, which could impact our ability to serve our members or curtail our monetization efforts; litigation and regulatory issues; increasing competition; our ability to manage our growth; our international operations; our ability to recruit and retain our employees; the application of U.S. and international tax laws on our tax structure and any changes to such tax laws; acquisitions we have made or may make in the future; and the dual class structure of our Class A common stock.

Further information on these and other factors that could affect the company’s financial results is included in filings it makes with the Securities and Exchange Commission from time to time, including the section entitled “Risk Factors” in the company’s Annual Report on Form 10-K for the year ended December 31, 2015, and additional information will also be set forth in our Form 10-Q that will be filed for the quarter ended March 31, 2016, which should be read in conjunction with these financial results. These documents are or will be available on the SEC Filings section of the Investor Relations page of the company's website at http://investors.linkedin.com/. All information provided in this release and in the attachments is as of April 28, 2016, and LinkedIn undertakes no duty to update this information.


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