There is value in connections. LinkedIn shares increased as the demand for hiring services soars higher.
LinkedIn is the world's largest online community for professionals. The social network reported increased profit and revenue numbers for the first quarter and even raised its forecasts for 2016.
The social network shares grew by 7.6 percent ($132.3) during April 28 trading, since the social network reported low figures in its Feb. 4 fourth-quarter report.
LinkedIn's talent solutions business' revenue, the service that connects headhunters with job seekers, soared by 41 percent and raked in $558 million in its first-quarter report. This offering covers almost two-thirds of LinkedIn's total income.
Its revenue from advertisements also increased by 29 percent, a figure observed as the strongest in the last three quarters. LinkedIn is targeting to increase user engagement by improving its mobile app and focusing on sponsored content. This move is a way of stepping out of the conventional display ads.
"[The advertisement business] doing better is definitely a healthy sign as that's been a segment that people have been concerned about in particular," said analyst Arvind Bhatia from Sterne Agee CRT.
The social network for professionals is also expanding its sales team as well as buying other companies. LinkedIn has shown heavy spending to grow its footprint outside of the United States.
There is a strong growth of user base in China, which helped drive LinkedIn's total user base higher by 19 percent (433 million). In April, LinkedIn opened a data center in Singapore, which is the first outside of the United States, to support its increasing Asia Pacific user base.
LinkedIn is setting its sights even higher. The company just increased its full-year extended profit forecast from $3.05 - $3.2 to $3.3 - $3.4 a share. In terms of revenue forecast, LinkedIn raised their estimates from $3.6 billion - $3.65 billion to $3.65 billion - $3.7 billion.
LinkedIn raked in 74 cents per share revenue, which surpassed the estimated average from analysts of 60 cents per share, as per Thomson Reuters I/B/E/S.
Their revenue totaled at $860.7 million with a 35 percent increase. The average estimate from analysts was only $828.5 million.
