Yelp Inc (NYSE:YELP) posted fainted earnings results for the first quarter and lowered its annual forecast. Yelp also cut down its sales forecast for ongoing quarter. The shares of the company fell sharply following disclosure of disappointed earnings report.
The local business ratings and reviews site said it endured a loss of $1.3 million, or two cents per share, below from its previous loss of $2.6 million, or four cents per share, a year earlier. The adjusted profit of Yelp stood at 10 cents per share, beating the analysts’ profit estimate of one cent per share.
Yelp’s turnover climbed up 55% to $118.5 million but still valuing below then the 120 million, estimated by analysts.
Most of the revenue of Yelp was attributable to local advertising, which contributed $98.6 million to the total revenue in the first quarter. Yelp’s local advertisers are growing at an incredibly super fast rate. Its account in this respect bolstered to some 90,200, indicating an increase of 43%.
The user-review website also reported an increase of 8% year on year to almost 142 million in its monthly unique visitors, but the visitors account grew less than 13% in last quarter and 30% in a year earlier period.
On the other hand mobile visitors lagged the desktop visitors. 29% boost is recorded regarding visitors using Yelp via mobile platform contrasting Yelp visitors via desktop platform which saw a decline of 3%.
“Looking to the rest of the year, we will continue to seek ways to increase engagement and drive awareness, while striving to demonstrate the value we can deliver to local businesses in order to capture the large local advertising market opportunity,” said CEO Jeremy Stoppelman in a statement.
The company’s outlook for earnings margin was down on both the top and bottom line for the current year. Yelp expects revenue to be in range of $574 million to $579 million and adjusted earnings of $102 million to $105 million, below the average forecasts of $579 million in revenue and $106 million in earnings. Yelp forecast second-quarter sales of $131 million to $134 million, falling short of analysts’ average estimate of $137.4 million.
Yelp is muscling up its efforts to draw more customers to its platform. Recent acquisition of Eat24, an online food delivery service with over 20,000 restaurants, would assist company in luring more customers.
