Today: LinkedIn posts a loss to complete a wave of earnings reports from social-media companies that produced different reactions from Wall Street.
The Lead: LinkedIn announces a quarterly loss amid continued spending
LinkedIn lost money in the first three months of the year while spending on international expansion, but the professional-networking company continued to show off big sales gains in the final first-quarter earnings report from Silicon Valley's social-media sector.
The Mountain View company announced Thursday that it lost $13.4 million in the first quarter, 11 cents per share, on sales of $473.2 million. The results reflected revenue gains of 45.8 percent from the same quarter last year, keeping LinkedIn on a growth track that saw it post revenues gains of 57.1 percent in 2013.
"The first quarter was strong for LinkedIn in terms of our member engagement and financial results," CEO Jeff Weiner said in Thursday's announcement, in which he also mentioned LinkedIn's expansion to China and other initiatives.
LinkedIn's focus on spending now to grow for the future is not new: The company increased spending on capital expenditures by more than 120 percent in 2013, when it also increased spending on research and development while boosting its work force to more than 5,000 employees.
LinkedIn still managed to post a profit in 2013, but it is now posting losses while its growth slows marginally, which is not winning the fans of analysts and investors: Shares slid to less than $155 in late trading after closing with a 5.1 percent advance to $161.22, and LinkedIn's market cap has fallen as much as 44 percent from all-time highs reached in September.
"Sentiment has turned decidedly negative on LinkedIn given the rate of decelerating growth and relatively high valuation," JPMorgan Chase analyst Doug Anmuth told Bloomberg News.
Analysts were also displeased by LinkedIn's forecast for the rest of the year, which projected annual sales of $2.06 billion to $2.08 billion, which would be a year-over-year growth rate of about 35 percent. The company also predicted sales in the current quarter will be $500 million to $505 million, while analysts forecast $505.5 million.
"Historically, they almost always exceed the high-end of their guidance range," BGC Partners analyst Colin Gillis noted to Bloomberg. "Investors who want to own LinkedIn have to make sure they have the stomach for the volatility that comes with this stock."
SV150 market report: Wall Street stalls, but tech stocks gain
Wall Street moved very little overall Thursday, but tech stocks enjoyed gains as the rest of the social-media sector moved higher after more than a week of volatility amid earnings reports.
The world's biggest social network, Facebook, continued to bounce back from recent losses, gaining 2.3 percent to $61.15. The Menlo Park company, which announced well-received earnings last week but then resumed a tail spin into bear market territory, was one of a handful of Silicon Valley giants that have reportedly stopped immediately cooperating with government requests for user data. The company faces accusations that its virtual-reality acquisition, Oculus, used another company's intellectual property to develop its headset, but analysts were more focused on Facebook CEO Mark Zuckerberg's announcements at the company's f8 developers conference Thursday.
Wednesday's social-media earnings centerpiece, Yelp, jumped 9.8 percent to $64.02 after its first-quarter earnings report beat analysts' expectations, with more than one analyst noting that the San Francisco customer-reviews site's recent stock decline could make it an attractive acquisition target for other tech companies. Twitter bounced back slightly from a post-earnings plunge that sent it to new lows, gaining 0.3 percent to $39.09.
Jive Software attempts to bring social-networking to the enterprise with its software, and the Palo Alto company got a huge boost Thursday from a partnership with San Jose networking giant Cisco, which will ditch its similar WebEx Social offering to peddle Jive to its customers instead, the companies announced Thursday. While Cisco dropped 0.4 percent to $23.01, Jive -- which has reportedly seeking an acquisition suitor -- soared 10.3 percent higher to $8.25. Apple tested the $600 level, reaching $599.43 before closing with a 0.2 percent gain at $591.48, as IDC reported tablet sales could be reaching a plateau. Tesla Motors dropped 0.1 percent to $207.73 after being hit with $89,000 in fines for an incident at its Fremont facility that injured three workers, while New Jersey lawmakers look to reverse a ban on the company's sales in that state.
Up: Yelp, Pandora, LinkedIn, Netflix, AMD, SolarCity, Workday, Facebook, Yahoo, EA, Adobe, SunPower, Juniper, Salesforce, Google, Gilead
Down: Zynga, Hewlett-Packard, Intel, Applied Materials, Symantec, VMware, Cisco, eBay, NetApp, Tesla
The SV150 index of Silicon Valley's largest tech companies: Up 5.33, or 0.38 percent, to 1,399.79
The tech-heavy Nasdaq composite index: Up 12.9, or 0.3 percent, to 4,127.45
The blue chip Dow Jones industrial average: Down 21.97, or 0.13 percent, to 16,558.87
And the widely watched Standard & Poor's 500 index: Down 0.27, or 0.01 percent, to 1,883.68
Check in weekday afternoons for the 60-Second Business Break, a summary of news from Mercury News staff writers, The Associated Press, Bloomberg News and other wire services. Contact Jeremy C. Owens at 408-920-5876; follow him at Twitter.com/jowens510.