Yelp Inc. Beats Q1 EPS Estimates; Misses On Revenues; Slashes Sales Guidance: Shares Plummet 30%
Written by StockNews.com
Yelp Inc. (NYSE:YELP) late Tuesday posted mixed Q1 earnings results and cut its full-year revenue outlook, sending its shares plunging in aftermarket trading.
The San Francisco-based local business reviews giant reported Q1:
- earnings per share (EPS) of $0.19, which was $0.03 better than the Wall Street consensus estimate of $0.16 [while]
- revenues rose 24.4% from last year to $197.32 million, just missing analysts’ view for $198.51 million.
- Advertising revenue, which makes up the bulk of YELP’s business, jumped 24% in the latest period to $177.0 million.
The real story to Yelp’s report was its sub-par guidance. The company forecast:
- Q2 revenues of $202 to 206 million, well below the $215.29 million that analysts were expecting, and
- revenues for the full year 2017 are seen between $850 to $865 million, down from a prior outlook $880 to $900 million, and a far cry from Wall Street’s current estimate of $889.45 million for the year.
Despite the lowered outlook, Lanny Baker, Yelp’s Chief Financial Officer, attempted to paint an optimistic picture via press release:
“We had strong financial performance this quarter doubling adjusted EBITDA compared to a year ago.
While we are lowering our revenue and adjusted EBITDA outlook for the year,
- sales productivity has rebounded,
- transactions revenue has accelerated
- and we’ve seen promising results from our newly expanded retention efforts,
giving us confidence in our ability to grow and scale in 2017 and beyond.”
Investors greeted Yelp Inc.’s weak forecast with a barrage of selling, sending its shares down more than 30% in after-hours trading Tuesday. Year-to-date, YELP had already declined -9.00% prior to today’s report, versus a +7.58% rise in the benchmark S&P 500 index during the same period.
YELP currently has a StockNews.com POWR Rating of C (Neutral), and is ranked #29 of 45 stocks in the Internet category.
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