Top-line growth has been 43% a year, on average, since 2017, and reached $14 billion last year thanks to employers looking to hire and premium subscribers. In the meantime, Twitter, which Tesla (TSLA.O) boss Elon Musk bought in October for $44 billion, has lost advertisers, partly because of its toxicity.
The company controlled and led by Mark Zuckerberg also is distracted by the multiple trustbusters and other regulators aggressively targeting it.
User growth has slowed, for example, at Facebook parent Meta Platforms (META.O), and revenue declined last year. TikTok has chipped away at social networks targeting younger audiences while closer LinkedIn rivals have struggled. Under all that cover, LinkedIn is benefiting from parallel trends. ChatGPT, the company's AI initiative, is also creating outsized buzz. There’s also the fast growth in the Azure and other cloud services divisions and sustained revenue increases in the Office 365 and Windows commercial segments as well as in servers. The war over the “Call of Duty” maker is just one of many things happening at Microsoft that’s overshadowing LinkedIn. The record will stand unless regulators reverse their opposition to last year’s $69 billion agreed takeover of video-game developer Activision Blizzard (ATVI.O) or courts back it. Paying a 50% premium for LinkedIn and its 430 million users made it one of the technology industry’s largest deals ever and by far Microsoft’s biggest. Under his predecessor, Steve Ballmer, the company’s track record in M&A was terrible, including value-destructive acquisitions of Finnish cellphone maker Nokia and advertising agency aQuantive. Buying LinkedIn was a bold step for Satya Nadella, who became the software goliath’s third chief executive in early 2014. There were good reasons to be skeptical about the transaction at the time.
And in the emerging age of generative artificial intelligence, the verifiable identities of adult users, and their musings, will only amplify the value. Although the original vision of a universal and complete professional profile has yet to be realized, connecting business networking with Outlook and other workplace software is proving to be fruitful nevertheless. NEW YORK, June 28 (Reuters Breakingviews) - Most corporate acquisitions deteriorate over time, but Microsoft’s (MSFT.O) $26 billion deal for LinkedIn keeps getting better.
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