SAN FRANCISCO (AP) — LinkedIn finished last year with a strong showing, but the online professional networking service rattled already jittery investors by indicating its performance will weaken this year as management ramps up spending while revenue growth slows.
The projection released Thursday with LinkedIn's fourth-quarter results triggered an 8 percent drop in the company's stock price during extended trading. The shares shed $17.91 to $206.54.
LinkedIn Corp. also announced it is spending $120 million to buy Bright, a startup that makes data-analysis tools matching job hunters with employers.
The acquisition could foreshadow a year of heavy investment that crimps LinkedIn's earnings. CEO Jeff Weiner emphasized the Mountain View, Calif., company will be spending "significantly" on data centers and long-term projects that may take several years to pay off.
The late sell-off in LinkedIn's stock came a day after another online networking service, Twitter Inc., disappointed Wall Street with a fourth-quarter report that revealed a jarring slowdown in its user growth. Twitter only added 9 million users during the period, well below its quarterly average of 16 million additional users during the previous year.
In contrast, LinkedIn is persuading more people to set up accounts and share their job histories at a steady pace that suggests more people are interested in managing their careers than sending short messages on Twitter.
Another 18 million LinkedIn accounts were set up in the fourth quarter, extending the service's reach to 277 million users through December. That matched the average of additional accounts that LinkedIn gained in the previous four quarters. Twitter ended December with 241 million users.