The earning were very good and the stock is likely to get a good boost, at least in the short term. The full year guidance was also raised. The important thing is that the losses have declined significantly. The net revenues were up 69% to $55 million, and the net loss declined from $2 million to $878K. The adjusted EBITDA was $7.8 million compared to $1.6 million (nearly 5 times). The other metrics, like cumulative reviews (up 41% to 42.5 million), average monthly unique visitors (up 38% to 108 million) and active local business accounts (up 62% to 51,400), have also shown good growth. This performance indicates that the prospects are improving, and the focus on improving the margins is yielding results. As per the management, the company launched new features on the mobile app and created a Call to Action feature, another way to close the loop between consumers and local businesses. The focus is likely to remain on “driving innovation in mobile, integrating Qype, and closing the loop with local businesses." The guidance for the next quarter is for a net revenue of $58 million to $59 million and adjusted EBITDA of $7.5 to $8.0 million. For the full fiscal, the net revenue is expected to be $222 million to $224 million and adjusted EBITDA around $27 million to $28 million. All this indicates good growth prospects, and if the net margins also show improvement, then the stock will gather even more momentum over time. The competition is surely strong and is likely to increase. There is direct and indirect competition from companies like Google (GOOG) and Yahoo (YHOO). There are issues like the patent infringement lawsuit filed by Blue Calypso (BCYP) which will remain an overhang. BCYP has got into a settlement with one of the defendants recently, and it will be good to see the progress on the trial against Yelp. However, YELP is showing good signs for the immediate future, and the future prospects are better after the earnings.
