Yelp shares are tumbling in the wake of the company’s Q3 earnings announcement.
The stock is down 13% in early trading.
The company reported that quarterly revenue jumped 67% to $US102.5 million, which was a bit higher than the $US99 million expected by analysts. Earnings came in at $US0.05 cents per share, which was well ahead of the $US0.02 expected.
Management’s guidance, however, was a bit light. They expect Q4 revenue between $US107 million and $US108 million versus expectations for $US111 million.
“We had an outstanding quarter driven by strong execution across all areas of our business,” CEO Jeremy Stoppelman said.
While the pace of growth appears to be impressive, expectations for these young tech startups tend to be quite high. As such, it’s very easy to disappoint investors.
It’s definitely worth pointing out that Yelp is up about 185% since its IPO three years ago.