LinkedIn 2013 Annual Report Download - page 27

• shifts in the way members and users access our websites and services from personal computers to
mobile devices;
• the unproven nature of our business model;
• changes in our pricing policies or those of our competitors;
• our ability to increase sales of our products and solutions to new customers and expand sales of
additional products and solutions to our existing customers;
• the size and seasonal variability of our customers’ recruiting and marketing budgets;
• the extent to which existing customers renew their agreements with us and the timing and terms of
those renewals;
• macroeconomic changes, in particular, deterioration in labor markets, which would adversely impact
sales of our Talent Solutions, or economic growth that does not lead to job growth, for instance
increases in productivity;
• the cost of investing in our technology infrastructure, product initiatives and international
expansion may be greater than we anticipate;
• expenses related to hiring, incentivizing and retaining employees;
• the timing and costs of expanding our field sales organization and delays or inability in achieving
expected productivity;
• the timing of certain expenditures, including hiring of employees and capital expenditures;
• the entrance of new competitors in our market whether by established companies or the entrance
of new companies; and
• general industry and macroeconomic conditions.
Given our limited operating history and the rapidly evolving market of online professional networks,
our historical operating results may not be useful to you in predicting our future operating results. We
believe our rapid growth has masked the cyclicality and seasonality of our business. As our revenue
growth rate slows, we expect that the cyclicality and seasonality in our business may become more
pronounced and may in the future cause our operating results to fluctuate. In particular, we expect sales
of Talent Solutions to be weaker in the first quarter of the year due to budgetary cycles and sales of our
Marketing Solutions to be weaker in the third quarter of the year as use of online services during the
summer months generally slows. In addition, global economic concerns continue to create uncertainty and
unpredictability and add risk to our future outlook. Sovereign debt issues and economic uncertainty in the
United States, Europe and around the world raise concerns in markets important to our business. An
economic downturn in any particular region in which we do business or globally could result in reductions
in sales of our Talent Solutions and Marketing Solutions, decreased renewals of existing arrangements and
other adverse effects that could harm our operating results.
We expect our revenue growth rate to decline, and, as our costs increase, we may not be able to generate
sufficient revenue to sustain our profitability over the long term.
From 2008 to 2013, our annual net revenue grew from $78.8 million to $1,528.5 million, which
represents a compounded annual growth rate of approximately 81%. As our net revenue has increased,
our revenue growth rate has slowed, and we expect that it will continue to decline over time. We also
expect that the growth rates of each of our three primary business lines will fluctuate and that these
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