Shares of Yelp Inc. (NYSE: YELP) soared after the online review website reported second quarter profit that beat Wall Street estimates and resulted in a 21% surge in advertising revenue.
The San Francisco-based company on Wednesday reported net income of USD 10.7 Million, or 12 cents per share. Earnings, adjusted for stock option expense, came to 38 cents per share. The average estimate of 12 analysts surveyed by Zacks Investment Research was for earnings of 25 cents per share.
It posted revenue of USD 234.9 Million in the period, also exceeding Street forecasts. Fourteen analysts surveyed by Zacks expected USD 231.9 Million.
The Company's second-quarter ad revenue rose 21% to USD 226 Million from USD 187.7 Million a year earlier.
J.P. Morgan analyst Doug Anmuth reiterated his overweight rating for Yelp shares, citing the Company's strong earnings results. “Strong 2Q … Home & local services ad revenue accelerated for the 3rd straight quarter as Request-A-Quote (RAQ) adoption & monetization remains strong," Anmuth said in the note to clients Thursday. "Yelp remains one of our top SMID-cap ideas as we believe the company has a significant opportunity ahead in the large & growing local ad market."
For the current quarter ending in October, Yelp said it expects revenue in the range of USD 242 Million to USD 246 Million, compared to a previous forecast of USD 230 Million to USD 233 Million. The Company expects full-year revenue in the range of USD 952 Million to USD 967 Million, topping another forecast of USD 943 Million to USD 967 Million.
The positive results have sent Yelp’s shares up 29% to USD 49.23.