Yelp Inc. (YELP) swung to a net profit for the quarter ended Sep. 30, 2016. The company has made a net profit of $2.07 million, or $ 0.02 a share in the quarter, against a net loss of $8.08 million, or $0.11 a share in the last year period. On the other hand, adjusted net income for the quarter stood at $18.41 million, or $0.22 a share compared with $2.67 million or $0.03 a share, a year ago. Revenue during the quarter grew 29.73 percent to $186.23 million from $143.56 million in the previous year period. Gross margin for the quarter expanded 210 basis points over the previous year period to 92.16 percent. Operating margin for the quarter period stood at positive 1.05 percent as compared to a negative 7.46 percent for the previous year period.
Operating income for the quarter was $1.96 million, compared with an operating loss of $10.71 million in the previous year period.
However, the adjusted EBITDA for the quarter stood at $33.68 million compared with $12.53 million in the prior year period. At the same time, adjusted EBITDA margin improved 935 basis points in the quarter to 18.08 percent from 8.73 percent in the last year period.
"We had an outstanding quarter in which Local revenue grew 41% year over year and we recorded the highest adjusted EBITDA in company history," said Jeremy Stoppelman, Yelps co-founder and chief executive officer. "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."
For the fourth-quarter, Yelp forecasts revenue to be in the range of $191 million to $195 million. Yelp forecasts revenue to be in the range of $709 million to $713 million for fiscal year 2016.
Operating cash flow improves significantlyYelp Inc. has generated cash of $81.79 million from operating activities during the nine month period, up 52.80 percent or $28.26 million, when compared with the last year period. The company has spent $46.59 million cash to meet investing activities during the nine month period as against cash outgo of $147.16 million in the last year period. It has incurred net capital expenditure of $28.50 million on net basis during the nine month period, down 17.53 percent or $6.06 million from year ago period.
Cash flow from financing activities was $18.06 million for the nine month period, down 3.79 percent or $0.71 million, when compared with the last year period.
Cash and cash equivalents stood at $224.89 million as on Sep. 30, 2016, up 30.90 percent or $53.08 million from $171.81 million on Sep. 30, 2015.
Working capital increases
Yelp Inc. has recorded an increase in the working capital over the last year. It stood at $450.93 million as at Sep. 30, 2016, up 14.82 percent or $58.19 million from $392.74 million on Sep. 30, 2015. Current ratio was at 8.09 as on Sep. 30, 2016, down from 8.13 on Sep. 30, 2015.
Days sales outstanding went down to 27 days for the quarter compared with 28 days for the same period last year.
At the same time, days payable outstanding went down to 9 days for the quarter from 16 for the same period last year.
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