Yelp, the local online business and restaurant guide that has become the Web’s go-to resource for reviews of local businesses since launching in 2004, announced its 2013 third quarter earnings after the market closed this afternoon. For the second straight quarter, the company beat expectations, with revenue coming in at $61.2 million in the third quarter and a per-share loss of $0.04.
Considering Yelp posted a greater-than-expected loss of $2.3 million, it wasn’t a categorical victory, but it was a win nonetheless, with revenue increasing 80 percent from the same period in 2012, while cumulative reviews grew 42 percent year-over-year to over 47.3 million, average unique visitors grew 41 percent year-over-year and local business accounts grew 61 percent to 57,000.
Wall Street expected Yelp to announce a loss of $0.01 per share on revenue of $59.40 million for the quarter. Yelp passed muster in revenues, but saw an uptick in its net losses in the third quarter of $2.3 million, or $0.04 per share, compared to a net loss of $2.0 million in the third quarter of 2012.
Thanks to a fairly consistent performance in recent quarters and solid progress from its local ads business, Yelp’s stock price has bounced back significantly over the last six months – 180 percent in all. This is a strong signal that investor confidence has returned for Yelp, even if many analysts believe that the market is a little too bullish on the company at the moment.
The company’s stock price had been hovering around $68 per share on Tuesday, but is currently down 6 percent in after hours trading on the higher-than-expected loss, though it continues to vacillate.
Reflecting on his company’s third quarter performance, Yelp CEO Jeremy Stoppelman highlighted the company’s renewed focus on its mobile experience as continuing source of growth and opportunity. The CEO also expects its new “Yelp Platform,” which launched in July and allows local businesses to interact directly with customers via its portal, to provide additional value for businesses while increasing engagement among consumers. The company also saw continuing growth in its unique user base over the last quarter, which now stands at 117 million.
In its earnings statement today, the Yelp CEO continued:
We saw another quarter of strong momentum thanks to the high-quality, authentic content contributed by Yelpers around the world … and our focus on connecting consumers with great local businesses continues to drive our success. In the third quarter, we improved the user experience by adding the ability to write and post reviews from mobile and launched new features such as the customer activity feed for business owners. Looking to the rest of the year and beyond, we are well positioned to capture the large local opportunity ahead of us through our innovation around mobile, geographic expansion and closing the loop with local businesses.
– October 29, 2013
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