What: Shares of Yelp (NYSE:YELP) I were up 18.3% as of 11:00 a.m. EST Friday after the local business review specialist announced better-than-expected first-quarter 2016 results.
So what: Quarterly revenue climbed 34% year over year, to $158.6 million, and would have risen 42% had it not been for Yelp's strategic decision last year to phase out its display advertising product in favor of focusing on its more promising local ad products. To be sure, local advertising accounts grew 34% year over year, to roughly 121,000, cumulative reviews grew 31% year over year, to $102 million, and average monthly app unique devices increased 32%, to 21 million.
Trending toward the bottom line, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) was $13 million. And based on generally accepted accounting principles (GAAP), that translated to a net loss of $15.5 million, or $0.20 per share. On an adjusted (non-GAAP) basis, which adds perspective by excluding items like stock-based compensation and amortization, net income was $6.0 million, or $0.08 per share.
By comparison, Yelp's guidance provided last quarter called for lower Q1 revenue of $154 million to $157 million, and adjusted EBITDA of $10 million to $12 million.
Yelp CEO Jeremy Stoppelman called it a "great start to the year," then elaborated, "With a mobile review contributed every two seconds on average in the quarter, our fresh, relevant review content is what makes Yelp a destination for consumers looking to find and transact with great local businesses. Our sizable, purchase-oriented traffic makes us the perfect place for local businesses to advertise and positions us well to capture the significant opportunity as local ad dollars continue to shift online."