Xing grows revenue while profit falls – and no LinkedIn takeover likely

Next Story

Qualcomm releases first batch of next year's chips

Logo Xing[Germany] Hamburg based business social network Xing, similar to LinkedIn in Europe, continued to grow revenue and EBIDTA in the first nine months of 2009 while profits were smaller than last year.

Total revenues from January to September amounted to €33.2 million – or $49 million – up 32 percent from the same period last year (€25.1 million). But the cumulative group profits were lower than those for the same period last year (€2.5 million for 2009 vs. €4.7 million for 2008), due to “investment costs and the assignment of €1 million in one-off tax reserves for Q3”.

Q3 revenues were also up 27% from the previous year to €11.7 million (Q3/2008: €9.18 million), and 8% over the last quarter (Q2/2009: €10.79 million). The EBITDA margin was increased over the last quarter from 23% to 25%. Operating six-month EBITDA also improved slightly, from €8.7 million in 2008 to €8.8 in 2009.

Xing shares since September.

Xing shares since September.

As before, the continued growth of premium members was the primary revenue generator for the reporting period. In Q3/2009, 661,662 thousand Xing Premium members generated a total of €9.96 million in the “Subscriptions” segment. This represents an increase of nine percent from last quarter’s results (Q2/2009: €9.18 million), and a 34% increase from last year (Q3/2008: €7.42).

As of September 30, Xing had 8.3 million members. Most of them (43.4%) are still living Germany, Austria or Switzerland, where Xing is the market leader. But lately the social network is boosting its member growth in Turkey and Spain. The Company reported its strongest quarterly results to date in these countries, gaining market share from its competitors.

This September’s buyout rumours on TechCrunch, which were based on a small €3 jump in Xing’s shares but caused a much higher spike after analysts refered to them, don’t seem to materialize. LinkedIn founder Konstantin Guericke has given a good explanation why the long awaited takover offer from his company doesn’t come: It’s just not necessary. LinkedIn grows “by the size of one Xing in every three months”.

  • Björn Wilmsmann

    I’m not sure but a takeover by LinkedIn could make sense since almost everyone (or at least all those who use the Internet for more than getting their eMail) in Germany who’s not a student anymore is on XING but hardly anyone is on LinkedIn.

    For most of these people there simply is no reason for using LinkedIn in parallel or even for completely switching to LinkedIn. They mostly do business or find jobs in Germany so using a network with hardly any German users doesn’t make sense for them and will continue to do so no matter how quickly LinkedIn is growing in other parts of the world.

    This effectively keeps LinkedIn from becoming a major player in the German market, which after the US arguably is the most important online market.

  • Burda buys 25% stake in XING

    […] based business social network XING continued to grow revenue and EBIDTA in the first nine months of 2009 while profits were smaller than last year. Total […]

blog comments powered by Disqus