Yelp Inc. (NYSE: YELP)
Shares of YELP plummeted lower by over 25% while touching 2 year lows in yesterday’s session as the company posted disappointing earnings along with a slash in revenue outlook and loss of advertisers as they move away from the company’s digital display ads.
YELP CEO Comments
On a conference call on Wednesday while the Second Quarter of 2015 results were being discussed, the Chief Executive Officer, Jeremy Stoppelman noted;
“While this year hasn’t gone as smoothly as we anticipated, I am as confident as ever about our future, particularly about the success of our apps and local advertising products. With the strength in our core business, we continue to believe that we can be a $1 billion revenue company by the end of 2017.”
Following the earnings report, analysts from 7 different firms slapped YELP with downgrades as significant worries arise on the company’s dim guidance along with the withdrawal of digital display ads.
The analyst firms behind the downgrades were Cowen, JMP Securities, Oppenheimer, Bank of America/Merrill Lynch, Morgan Stanley, Raymond James, and Topeka.
Morgan Stanley’s Brian Nowak made a brief but very strong and to-the-point comment that sums up the status of YELP; he said, “Fewer sales people + lower productivity = fewer local ad dollars.”
About Yelp Inc.
Yelp Inc. operates a platform that connects people with local businesses in the United States. Its platform covers various local business categories, including restaurants, shopping, beauty and fitness, arts, entertainment and events, home and local services, health, nightlife, travel and hotel, auto, and others categories. The company provides local advertising services, including free and paid business listing services to businesses of various sizes, as well as enable businesses to deliver targeted search advertising to large local audiences through its Website and mobile app. It also offers brand advertising services comprising advertising solutions for national brands in the food and restaurant, automobile, financial services, logistics, consumer goods, and health and fitness industries that want to improve their local presence in the form of display advertisements and brand sponsorships. In addition, the company provides other services, including Yelp platform, which allows consumers to transact directly on Yelp; Yelp deals that allows local business owners to create promotional discounted deals for their products and services; and gift certificates products for local business owners to sell full-price gift certificates directly to customers. It serves customers in Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile, the Czech Republic, Denmark, Finland, France, Germany, Hong Kong, Ireland, Italy, Japan, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Singapore, Spain, Sweden, Switzerland, Turkey, the United Kingdom, and the United States. It has a strategic partnership with YP to display YP business owner profile data on companys platform. The company was founded in 2004 and is headquartered in San Francisco, California. Yahoo Finance