As noted in a previous article, neither LinkedIn or Microsoft have reported on the monthly active users (MAU) of LinkedIn since Q3 of 2016, which was 106 million at the time. If Apptopia knows what they’re talking about, then LinkedIn’s MAU has more than doubled and has jumped to 220–260 million since their acquisition, which would be positive press for Microsoft and LinkedIn alike. However, if that were the case, then Microsoft and LinkedIn would most likely be shouting this from the roof tops instead of making a big deal about other inconsequential milestones such as their total users increasing to half a billion.
According to LinkedIn’s earnings statements, they only saw 6% growth in monthly usership between Q3 2015 and Q3 2016; a jump from roughly 100 million to 106 million monthly active users. Yet, since acquisition, Microsoft has ambiguously claimed 20% growth in sessions for three consecutive quarters while shying away from conversations pertaining to MAU. In order to do this while building on top of 106 million MAU, then they would have to be doing something radically different; which they aren’t. But if they are working with significantly smaller pool of monthly active users though, showing consistent 20% growth in usership is much more plausible.
Unfortunately and according to my sources within Microsoft, this may be due LinkedIn’s monthly active usership plummeting since their acquisition as speculated above. Just how bad is it? LinkedIn’s monthly active users have supposedly been reduced to a paltry 10,000,000 users per month by winter/spring of 2017 or roughly 10% of what it was during summer of 2016. To be fair though and according to Quantcast, LinkedIn was estimated to have roughly 30 million monthly users in the US alone when their acquisition was finalized and had jumped to almost 60 million monthly users during the time my sources were provided numbers; neither of which are favorable in my opinion. However, during August of 2016 when LinkedIn reported their 106 million monthly active users, Quantcast only reported 25 million in the US alone, which forces me question legitimacy their estimates.
How can this be though? It’s difficult to see merit in this number when their total users are on the rise while raking in almost a billion dollars in their first full quarter as well as Q4 2017. However, it’s just as difficult to see their MAU more than doubling, as estimated by Apptopia, while their total user base has only increased by 33 million users. I can only speculate with regard to total users, but like other social media platforms, it could have something to do with an influx of services allowing people to buy likes, endorsements, connections, and recommendations. When legitimate use goes down, people seldom delete accounts entirely and services such as these tend to increase while padding their total user count.
With regard to their revenue, as long as their power users like recruiters and premium members are under the impression that LinkedIn is a viable platform instead of a ghost town, they will continue to shovel money into a black hole until they begin to notice diminishing returns. In 2014, 61% of their revenue comes from recruiters services and 20% came from premium memberships, and the remaining 19% came from advertising. However, if they were to report on these revenue streams today, chances are that we would see a drop in advertising revenue while recruiting and premium memberships account for a larger piece of the pie.
Regardless of the revenue though and if this is true, which I have on good authority that it is, then it could mean that Microsoft’s acquisition of LinkedIn is the big blunder that everyone seemed to know that it would be all along. While this smells like a proper write-down in the making, which would be their largest write-down to date if it gets much worse, it would also showcase that even the pedestrians which were left scratching their heads on the rationale behind this acquisition may have a better understanding of this market than the detached leadership that is currently at the helm of Microsoft.