Local business reviews app Yelp Inc (NYSE:YELP) this morning posted much better than expected earnings results and provided an upbeat forecast, sending its shares soaring higher in early trading.
The San Francisco-based company reported Q3 EPS of $0.22, which is $0.04 better than Wall Street’s $0.18 estimate. Revenues surged 29.7% from last year to $186.2 million, also beating analysts’ view of $182.92 million.
Yelp noted that cumulative reviews rose 29% from last year to approximately 115 million, while App Unique Devices grew 24% to around 25 million on a monthly average basis. Local advertising accounts, which are the lifeblood of the company’s revenue stream, jumped 30% year-over-year to about 135 thousand.
Looking ahead, Yelp forecast Q4 revenues of $191-195 million, which straddles Wall Street’s $192.64 million estimate. For the full year 2016, YELP sees revenues $709-713 million, which would beat analysts’ view of $707.61 million.
The company commented via press release:
“We continue to pursue our mission of connecting consumers with great local businesses everywhere, and our local business in the U.S. has accelerated this year. We have not yet achieved the same level of traction internationally and we have decided to redirect our resources towards the domestic opportunity for now. This was not an easy decision as it affects our valued colleagues abroad, however it allows us to sharpen our focus on the large, profitable and rapidly growing domestic business.”
Yelp shares rose $3.52 (+10.84%) to 36.00 in premarket trading Wednesday. Prior to today’s report, YELP had gained 12.78%, versus a 3.5% rise in the benchmark S&P 500 index during the same period.