Twitter, LinkedIn on the up

LinkedIn maintained its perfect record of pleasant surprises as the online professional networking service expanded its reach during the fourth quarter and added more tools to help connect salespeople with potential customers.

The results announced Thursday marked the 15th consecutive quarter that LinkedIn’s earnings and revenue have exceeded analysts’ projections since the Mountain View, California, company went public in May 2011.

The streak has been driven in part by LinkedIn’s cautious approach in the financial forecasts it releases every three months. Many analysts suspect management deliberately sets a low bar so it’s easier to clear. The suspected gamesmanship has prompted some analysts to boost their predictions above LinkedIn’s projections yet the company has still managed to top those numbers every quarter so far.

It’s a habit that investors love. After hitting a new peak during Thursday’s regular trading, LinkedIn’s stock surged another $15.91, or nearly 7 percent, to $253.15 in extended trading.

The company earned $3 million, or 2 cents per share, during the final three months of last year. That represented a 21 percent decrease from $3.8 million, or 3 cents per share, in the same 2013 period.

If not for certain accounting items, LinkedIn said it would have earned 61 cents per share. That figure exceeded the average estimate of 53 cents per share among analysts surveyed by FactSet.

Fourth-quarter revenue climbed 44 percent from the previous year to $643 million – about $26 million above analysts’ projections.

LinkedIn Corp. ended December with 347 million users who had posted their work histories on the service, a gain of 15 million from September. More people clocked into LinkedIn, too, and spent more time perusing the career advice shared on its site. That trend is a positive sign because it helps LinkedIn gather more insights about its users and sell advertising.

Unlike most Internet services, LinkedIn generates most of its revenue from additional features, tools and access that it sells to other companies and headhunters on the prowl for talented workers. The company also has recently started to help companies generate more sales of their products and services.

“LinkedIn creates value for members by connecting them to the people, knowledge and opportunities that matter most to them professionally,” CEO Jeff Weiner said in prepared remarks for a Thursday conference call with analysts.

Twitter posts strong results

Twitter posted stronger-than-expected results in the fourth quarter, shrinking its losses and nearly doubling revenue as it drew more users and expanded its reach and ad offerings.

Shares jumped over 6 percent in aftermarket trading.

The San Francisco-based short messaging service was still privately held for part of the year-ago quarter – it went public in November 2013. For the final three months of 2014 it had losses of $125.4 million, or 20 cents per share, compared with a loss of $511.5 million, or $1.41 per share, a year earlier. Excluding one-time items, Twitter earned $79.3 million, or 12 cents per share – double the 6 cents expected by analysts, according to FactSet.

Revenue surged to $479.1 million from $242.7 million, also topping analysts’ average estimate of $453.8 million.

Twitter’s stock had closed before the report at $41.26, a decline of 37.5 percent over the past year amid concerns about its ability to broaden its audience.

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