LinkedIn Unveils LinkedIn Learning, Redesigns Desktop Product

LinkedIn Learning provides e-courses and training services at $29.99 per month

l1Professional social network LinkedIn Corp. (NYSE: LNKD) has redesigned its desktop product, improving the news feed and adding messenger bots to make it less cluttered and similar to a new mobile app rolled out earlier in 2016, as reported by Bloomberg on September 22nd, 2016. The company will also add a scheduler bot that can automatically check online calendars from other providers for available meeting times and suggest locations when two users are messaging, ahead of being acquired by technology giant Microsoft Corp. (NASDAQ: MSFT). Adding messenger bots to its desktop product is seen to be an area that could signify overlaps with Microsoft, which is now heavily focused on artificial intelligence-based chat software.

LinkedIn is also rolling out LinkedIn Learning, a site that provides e-courses and training services. LinkedIn Learning will be based on services from Lynda.com, an online learning site that the Company acquired for $1.5 billion in 2016. The new service offers more than 9,000 online courses in subjects including business, technology, and creative topics like programming, writing, and accounting. LinkedIn Learning also details what courses a user should take to pursue a certain job. l2Additionally, courses can be recommended to other users within the professional network. LinkedIn is targeting both businesses and higher education institutions through the site. The service costs $29.99 per month and is free for LinkedIn premium subscribers.

Betting big on India

On September 12th, 2016, LinkedIn’s announcements for India also revolved about bringing learners onto its platform. The Company launched three products; a mobile site called LinkedIn Lite; a product aimed at the college placements market called LinkedIn Placements, and a LinkedIn Starter Pack aimed at startups and small businesses. These three initiatives are also targeted at other markets where there are shortfalls in terms of storage and bandwidth. All of the three products were entirely developed by its 250-person-strong R&D outfit in Bengaluru, Karnataka. India is home to LinkedIn’s second-largest user base with 37 million members, only behind the U.S., which has over 130 million users.

Acquisition by Microsoft

LinkedIn was acquired on June 11th, 2016, for $26.2 billion by Microsoft in one of the largest technology-industry deals so far in 2016. LinkedIn had become a prime takeover target after the Company forecast a growth slowdown in February 2016. After the forecast, LinkedIn’s stock plunged as much as 46.5% on February 6th, 2016, to a more than three-year low of $102.89, wiping out nearly $11 billion of market value.

The LinkedIn deal is largely seen as CEO Satya Nadella’s efforts to revamp the company and shift towards software and services delivered over the Internet. Microsoft, which lags behind in the consumer web space that is largely dominated by Alphabet Inc. (NASDAQ: GOOG), l3the parent company of Google Inc., and Facebook Inc. (NASDAQ: FB), wants to make its presence felt in social tools for professionals. Read more about Microsoft’s latest acquisition bid.

Microsoft paid $196 per share in an all-cash deal, including LinkedIn’s net cash, a 49.5% premium to LinkedIn’s closing price on Friday, June 10th, 2016. LinkedIn retained its brand name and remain an independent company under CEO Jeff Weiner. The deal is the biggest ever for Microsoft as Nadella turns the focus on business customers with cloud-based services and productivity tools. In a press conference after the announcement of the LinkedIn buyout, Microsoft outlined a vision in which a person’s LinkedIn profile could mesh seamlessly with Windows, Outlook, Skype, Office productivity tools like Excel and PowerPoint, and other Microsoft products. LinkedIn’s analytics could help power data tools for Microsoft’s Dynamics, which competes with Salesforce.com in helping companies manage customer relationships.

That apart, the LinkedIn acquisition signals a broader shift in Microsoft’s corporate strategy to become a company that primarily sells online services to business customers. LinkedIn is seen to help Microsoft both broaden the set of business customers it can serve and deepen the relationship with those it already serves. LinkedIn is considered an essential networking tool, with more than 100 million monthly active users.

l4LinkedIn complements Microsoft’s shifting business model

It is very obvious that there is a significant overlap between LinkedIn’s user base, corporate professionals, and Microsoft’s customers. LinkedIn is already providing online services rather than selling software, and offers a Facebook-style newsfeed to its users. Microsoft plans to integrate this newsfeed into the Office 365 user interface, allowing users to keep track of developments in their professional network while they are working on a spreadsheet or presentation.

Q2 FY16 financial highlights

LinkedIn announced its Q2 FY16 earnings results on August 8th, 2016. The Mountain View, California-based company’s revenue jumped 31% Y-o-Y to $933 million. Talent Solutions revenue grew 35% Y-o-Y to $597 million, Marketing Solutions revenue jumped 29% to $181 million, and Premium Subscriptions revenue rose 21% to $155 million during the reporting quarter. Despite higher revenue, LinkedIn’s Q2 FY16 GAAP net loss widened to $119.2 million from net loss of $67.7 million in the year-ago period. GAAP diluted EPS was $(0.89), compared to $(0.53) in the year-ago period.

Cumulative members grew 18% Y-o-Y to 450 million, unique visiting members grew 9% to an average of 106 million members a month, and member page views grew 32%. This yielded 21% Y-o-Y growth in page views per unique visiting member.

Stock performance

l5LinkedIn’s stock ended the day at $193.04, gaining 0.13%, at the close on Monday, September 26th, 2016, having vacillated between an intraday high of $194.27 and a low of $192.55 during the session. The stock’s trading volume was at 2,208,080 for the day. The Company’s market cap was at $26.01 billion as of Monday’s close.

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