Yelp Shares Plunge 13% On Weak Q4 Outlook, But Q3 Results Top View

(RTTNews) - Shares of Yelp, Inc. (YELP) plunged more than 13 percent in extended trading on Wednesday after the consumer review website provided revenue guidance for the fourth quarter, below Street view. However, the company raised revenue forecast for the full-year 2014.

The company also reported a profit for the third quarter compared to a loss last year, reflecting a 67 percent surge in revenues. Both earnings per share and quarterly revenues topped analysts' expectations.

"We had an outstanding quarter driven by strong execution across all areas of our business. Supporting the Yelp community and providing an excellent consumer experience continue to be our top priorities. It was amazing to see more review content contributed this quarter than ever before," CEO Jeremy Stoppelman said in a statement.

San Francisco-based Yelp reported net income of $3.64 million or $0.05 per share for the third quarter, compared to a net loss of $2.32 million or $0.04 per share in the prior-year quarter.

On average, 30 analysts polled by Thomson Reuters expected the company to report earnings of $0.03 per share for the quarter. Analysts' estimates typically exclude special items.

Net revenue for the quarter surged 67 percent to $102.46 million from $61.18 million in the same quarter last year, and topped thirty-four Wall Street analysts' consensus estimate of $99.00 million.

Yelp said cumulative reviews for the quarter grew 41 percent year-over-year to about 67.0 million. Average monthly unique visitors increased 19 percent to about 139 million, and active local business accounts surged 51 percent from the year-ago quarter to about 86,200.

Yelp added that average monthly mobile unique visitors in the third quarter surged 46 percent to about 73 million, including both mobile web and mobile app users.

Yelp noted that it continues to expand globally, now available in 29 countries and available in 16 languages. It launched in Chile and Hong Kong in the third quarter. Yelp also introduced mobile review translation to assist global consumers.

Looking ahead, Yelp expects fourth-quarter revenues in a range of $107 million to $108 million, and raised revenue guidance for the full-year 2014 to a range of $375 million to $376 million from the prior guidance range of $372 million to $375 million.

Street is currently looking for revenues of $110.96 million for the fourth quarter and $375.20 million for the full-year 2014.

"As we look to the future, we'll continue to engage our community, develop new ways to show businesses the value Yelp provides and expand and deepen our geographic footprint. We are excited about the large opportunity ahead of us," Stoppelman added.

YELP closed Wednesday's regular trading session at $70.23, down $1.05 or 1.47% on a volume of 8.74 million shares. The stock plunged a further $9.23 or 13.14% in the after-hours trading.