LinkedIn 2015 Annual Report Download - page 54

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While we experienced significant revenue growth in 2015 compared to 2014, we had
significant operating losses as a result of our long-term investment strategy. In 2015, our net
revenue was $2,990.9 million, which represents an increase of 35% from 2014. Our net revenue
benefited from increased sales of our core products, specifically Recruiter, Jobs, Sponsored Content,
and Sales Solutions as well as revenue from our recent acquisition of Lynda.com. In 2015, we had an
operating loss of $214.7 million driven by increases in headcount-related expenses of $636.2 million as
we hired additional employees to support the growth in our business. We also had an increase of
$183.5 million in depreciation and amortization related to intangible assets from our acquisition of
Lynda.com, build out of our data centers, leasehold improvements as we lease additional facilities to
accommodate our headcount growth, and capitalized website and internal-use software.
We expect our growth rate to continue to decrease over time. As our net revenue increases,
we expect that our growth rate related to net revenue will continue to decrease over time. Also, given
the large scale and critical mass of our network, we believe member and engagement growth, as
measured by our key metrics, will decelerate over time and that this may impact the growth of certain
portions of our business. Our future growth will depend, in part, on our ability to continue to increase
member growth and engagement by creating value for members as well as strengthening our core
offerings on mobile and desktop devices and expanding our global presence, which we believe will
result in increased sales of our Talent Solutions, Marketing Solutions, and Premium Subscriptions.
Our long-term financial focus is on sustainable, long-term growth; however, in the near term
we expect US GAAP operating losses as we continue to make investments in our business.
Our investments in 2016 will focus on the following themes: our core products within Talent Solutions,
Marketing Solutions, and Premium Subscriptions, the marketplace dynamics between members and
customers to create reciprocal value in our products, and intelligent growth by supporting our
long-term financial objectives of sustainable revenue and earnings growth.
•Our Products. With respect to product development, we will continue to focus investment on
our member and customer value proposition: connect to opportunity.
•Members. We plan to continue to invest in our global member experience focusing on our
value propositions: helping members stay connected and informed, advance their careers,
and work smarter.
•Customers. We plan to invest in our core product development efforts to transform the way
customers hire, market, sell, and learn.
In addition, we expect to continue to invest in mobile across our product lines. Mobile is the
fastest growing channel for member engagement, growing at twice the rate of overall site traffic
with mobile unique visiting members representing 54% of unique visiting members in 2015.
•Our Talent. We expect to expand our workforce in 2016, however, such expansion, specifically
related to our sales and product development teams, will be at a slower rate than in 2015. We
expect that the increased headcount will result in an increase in related expenses, including
stock-based compensation expense and capital expenditures related to facilities. As of
December 31, 2015, we had 9,372 employees, which represented an increase of 36% compared
to the prior year end. Excluding the employees from our acquisition of Lynda.com, we would
have had 8,797 employees, which represents an increase of 28% compared to 2014.
•Our Technology. We expect to continue to make significant capital expenditures to upgrade our
technology and network infrastructure to improve the ability of our website to handle expected
increases in usage, to enable the release of new features and solutions, and to scale for future
growth. These investments are particularly focused on expanding our footprint of data centers.
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