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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-K

(Mark One)

ANNUAL REPORT PURSUANT TO SECTION

13 OR 15(d) OF THE SECURITIES EXCHANGE ACT

OF 1934
For the fiscal year ended December 31, 2013

or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from
to
Commission File Number: 001-35168

LinkedIn Corporation
(Exact name of registrant as specified in its charter)

Delaware

47-0912023

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer
Identification No.)

2029 Stierlin Court

Mountain View, CA 94043
(Address of principal executive offices) (Zip Code)

(650) 687-3600
(Registrants telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Name of Each Exchange on Which Registered

Class A Common Stock, par value $0.0001 per share

New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act:

None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes
Yes

No
No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted
and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit
and post such files). Yes No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (229.405 of this chapter) is not contained herein, and will not be contained,
to the best of registrants knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of
large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Non-accelerated filer

Accelerated filer
Smaller reporting company

(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes

No

As of June 28, 2013 (the last business day of the registrants most recently completed second fiscal quarter), the aggregate market value of Class A and Class B common
stock held by non-affiliates of the registrant was $16,706,421,511 .
As of February 5, 2014 , there were 103,566,988 shares of the registrants Class A common stock outstanding and 16,963,847 sha res of the registrants Class B common
stock outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the registrants definitive Proxy Statement for its 2014 Annual Meeting of stockholders are incorporated by reference in Part III of this Annual Report on Form
10-K where indicated. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrants fiscal year ended December 31, 2013 .

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Table of Contents
Page

PART I
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.

Business
Risk Factors
Unresolved Staff Comments
Properties
Legal Proceedings
Mine Safety Disclosures

4
15
31
31
32
32
PART II

Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.

Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities
Selected Financial Data
Managements Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information

33
36
39
56
58
87
87
89

PART III
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.

Directors, Executive Officers and Corporate Governance

Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accountant Fees and Services

89
89
89
89
89

PART IV
Item 15.

Exhibits, Financial Statement Schedules

90

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Special Note Regarding Forward Looking Statements

This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 21E of the Securities Exchange
Act of 1934, as amended, or the Exchange Act, particularly in Part I, Item 1: Business, Part I, Item 1A: Risk Factors and Part 2, Item 7:
Managements Discussion and Analysis of Financial Condition and Results of Operations. These statements are often identified by the use of
words such as may, will, expect, believe, anticipate, intend, could, should, estimate, or continue, and similar expressions
or variations. All statements other than statements of historical fact could be deemed forward-looking, including, but not limited to:
our ability to timely and effectively scale and adapt our existing technology and network infrastructure;
our ability to increase engagement of our solutions by our members, enterprises and professional organizations;

our ability to develop effective solutions for mobile devices;

our ability to protect our users information and adequately address

privacy concerns;

our ability to maintain an adequate rate of revenue growth;

the effects of increased competition in our market;

our ability to effectively manage our growth;

our ability to retain our existing subscribers and our Talent Solutions and Marketing Solutions customers;

our ability to successfully enter new markets and manage our

international expansion;

our ability to maintain, protect and enhance our brand and intellectual
property;

costs associated with defending intellectual property infringement and

other claims;

our investment philosophy for 2014;

our expectations for our financial performance in 2014, including our revenues, cost of revenues, expenses and expected tax benefits;
and

the attraction and retention of qualified employees and key personnel.

For a discussion of some of the factors that could cause actual results to differ materially from our forward-looking statements, see the
discussion on risk factors that appears in Part I, Item 1A: Risk Factors of this Annual Report on Form 10-K and other risks and uncertainties
detailed in this and our other reports and filings with the Securities and Exchange Commission, or SEC. The forward-looking statements in this
Annual Report on Form 10-K represent our views as of the date of this Annual Report on Form 10-K. We anticipate that subsequent events and
developments will cause our views to change. However, while we may elect to update these forward-looking statements at some point in the
future, we have no current intention of doing so except to the extent required by applicable law. You should, therefore, not rely on these
forward-looking statements as representing our views as of any date subsequent to the date of this Annual Report on Form 10-K.

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PART I
Item 1.

Business

Overview
We are the worlds largest professional network on the Internet with approximately 277 million members in over 200 countries and
territories as of the date of this Annual Report on Form 10-K. We believe we are the most extensive, accurate and accessible network focused
on professionals.
Our platform enables members to become more successful in their careers through three value propositions: managing and sharing who
they are through their digital professional identity; engaging and expanding who they know through their professional network; and
discovering professional knowledge and insights making them better at what they do. Our members create the core of our platform, and we, in
turn, provide members with applications and tools to help them compete more effectively, make better decisions faster and manage their careers
to achieve their full potential. The cornerstone of our business strategy is to focus on our members first. We provide the majority of our
solutions to our members at no cost. We believe this approach provides the best way to continue to build a critical mass of members, resulting
in beneficial network effects that promote greater utilization of our network, higher levels of engagement and, ultimately, increased value for all
of our members.
We generate revenue across three distinct product lines: Talent Solutions, Marketing Solutions, and Premium Subscriptions. All three
product lines are sold through two channels, an offline field sales organization which engages with both large and small enterprise customers;
as well as an online, self-serve channel where we generate revenue from both enterprise customers and individual members purchasing
subscriptions. We strive to ensure that our Talent Solutions, Marketing Solutions and Premium Subscriptions products provide both a high level
of value for our customers and also a high degree of relevance for our members. We believe this monetization strategy properly aligns
objectives among members, customers and our entire network and supports our financial objective of sustainable revenue and earnings growth
over the long term.
We were incorporated in Delaware in March 2003 under the name LinkedIn, Ltd. and changed our name to LinkedIn Corporation in
January 2005. Our principal executive offices are located at 2029 Stierlin Court, Mountain View, CA 94043, and our telephone number is
(650) 687-3600. Our website address is www.linkedin.com. We completed our initial public offering in May 2011 and our Class A common
stock is listed on the New York Stock Exchange (NYSE) under the symbol LNKD. Unless the context requires otherwise, the words
LinkedIn, we, Company, us and our refer to LinkedIn Corporation and our subsidiaries.
Our Mission
Our mission is to connect the worlds professionals to make them more productive and successful. Our members come first. We believe
that prioritizing the needs of our members is the most effective and, ultimately, the most profitable way to accomplish our mission and to create
long-term value for all of our stakeholders. We will continue to concentrate on opportunities we believe are in the best interests of our
members. Our long-term approach enables us to invest, innovate and pioneer in unexplored segments of our industry to increase the value
proposition for our members through our proprietary platform and extensive data.
Our solutions are designed to enable professionals to achieve higher levels of performance and professional success and enable
enterprises and professional organizations to find and connect with the worlds best talent.
Our Vision
Our vision is to create economic opportunity for every member of the global workforce, each of whom has the ability to create economic
opportunities for others. We believe this is the fundamental power of our network.
Ultimately, our goal is to create economic opportunity at massive scale by developing the worlds first economic graph, a digital map of
the global economy. In creating this map, we believe we can help our members navigate the increasingly challenging 21 st century global
economy.
Our Strategy
Our mission is to connect the worlds professionals to make them more productive and successful. The key elements of our strategy are:
Foster Viral Member Growth . With approximately 277 million members currently, we will continue to pursue initiatives that
promote the viral growth of our member base, that is, members expanding our member base by inviting other members. These
initiatives include registration optimization, including optimized mobile registration experience, enhanced search engine
optimization, seamless integration with other applications and enhancements to
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our communications capabilities. Viral growth is a critical element in our mission to connect the worlds professionals.
Serve as the Professional Profile of Record . By maintaining the trust we have developed with our members and through
continued improvements, such as enhancing our profile tools and search engine optimization, we seek to be the professional profile
for every professional worldwide. We increasingly give members the ability to represent their identities in the form of a dynamic
portfolio versus a static resume through rich media and other product enhancements. Using our platform, any member can find
other professionals on LinkedIn, connect with members relevant to their professional network, and be found by other professionals
on the Internet.
Become the Definitive Professional Publishing Platform . As the amount of information shared across the Internet rapidly
expands, we strive to deliver members relevant insights at the right time to make members better at what they do. By creating the
webs definitive professional publishing platform, LinkedIn will help members discover, consume, and publish relevant
professional content at global scale, ultimately making individual members more productive and successful. LinkedIns publishing
platform encompasses products including Groups, the LinkedIn homepage, our Pulse news product and Influencer program, the
Slideshare platform, and more recently the Pulse news reader mobile app.
Expand Our International Presence . We have seen significant growth in our international member base and have established
operations around the world, including Europe, Asia, South America and the Middle East. We intend to continue to grow our
international member base by making our platform available in more languages, by further developing our brand across various
international geographies, and by expanding our sales, technical and support operations in additional international locations.
Increase Monetization While Creating Value for Our Members . We intend to leverage our unique business model to further
monetize our platform while adding value to members, enterprises and professional organizations on a global basis. For example,
by providing our members with better tools to share their professional skills and insights, our Talent Solutions can more efficiently
and effectively identify specific passive and active candidates for a particular opportunity resulting in benefits for both members
and customers. A core part of our strategy is making our solutions more relevant for both our members and customers by
significantly investing in targeting capabilities and analytics.

Our Solutions
Our solutions are designed to make professionals more productive and successful and to connect talent with opportunity at massive scale.
To date our focus has been to develop products that enable our members to create, manage and share their professional identities online, build
and engage with their professional networks, access shared knowledge and business insights, and find business opportunities.
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Our principal free and monetized solutions are described below:

Free Solutions

Ability to Manage
Professional Identity
Profile
Public Profile
Who's Viewed Your Profile
Rich Media Sharing
Skills/Endorsements

Enhanced Ability to Build

and
Engage with
Professional Networks
LinkedIn Connections
Invitations
Search
LinkedIn Contacts
Introductions
People You May Know
Addressbook Importer
People Following

Access to Knowledge,
Insights
and Opportunities
Network Updates
Pulse
Influencers
Groups
Company Pages
Apply with LinkedIn University
Pages
LinkedIn Alumni
Slideshare
Personalization Platform

Ubiquitous Access
Mobile
APIs
Widgets

Monetized Solutions
Talent Solutions
LinkedIn Corporate
Solutions (Recruiter, Job Slots, Recruitment
Media, Career Pages, Talent Pipeline)
LinkedIn Jobs
Recruiter Lite/Talent Basic/Talent
Finder/Talent Pro
Job Seeker Basic/Job Seeker/
Job Seeker Plus

Marketing Solutions
Display Ads
Sponsored InMails
Sponsored Updates
LinkedIn Ads
Ads API

Premium Subscriptions
Business
Business Plus
Executive
InMail
Sales Navigator
TeamLink
Lead Builder

Free Solutions
Most of our member solutions are available at no cost and are designed to provide compelling professional benefits.
Ability to Manage Professional Identity
Profile. Our core offering provides every member an online professional profile. A members profile is accessible to all members
on our network and includes user-generated information including current job title and employer, education, career history, domain
expertise, accomplishments, skills and additional professional information such as honors, awards, association memberships,
patents, publications, certifications and languages spoken. Members populate their own profile information, enabling them to
ensure their professional identity is accurate, current and under their control. In addition, were piloting Direct-to-Profile
Certifications allowing members to update their Profiles with certifications of courses completed through partner sites.
Whos Viewed Your Profile. The Whos Viewed Your Profile module provides real-time analytics to help members better manage
their professional profile including information on who has viewed their profile, top search keywords used to reach their profile,
and other details and trends on the demographics of the audience that has viewed their profile. Additional features of this product
are available for members with Premium Subscriptions.
Rich Media/Skills/Endorsements. Members can provide examples of their work and skills by sharing rich media content in their
profiles. Additionally, members are able to both specify skills on their professional profiles and search for skills and expertise
across our network, which surfaces key people within a community, top locations, related companies, relevant jobs, and groups
where members can interact with like-minded professionals. In addition, Endorsements enables members to endorse their first
degree connections for skills with one click.
Enhanced Ability to Build and Engage with Professional Networks
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LinkedIn Connections. Once two members are connected, their profile information is shared and, subject to privacy settings, each
member has access to the other members list of connections for further networking. Connections across the network are classified
to three degrees: first degree connections are members who agree to connect, second degree connections are members who share
one or more mutual connections, and third degree connections are related via two connections. Members can retrieve the contact
information of their first degree connections and browse their second and third degree connections in order to find additional
opportunities to network and connect.
Invitations. Members can expand their networks by sending invitations. Any non-member accepting an invitation simultaneously
becomes a LinkedIn member, connected to the sender, after completing the registration process.
Search. Our proprietary search technology allows users to conduct real-time, multilingual searches of our rich dataset in a
completely personalized manner, as a members profile and network affect relevance and ranking of results. Our search covers:

People. Faceted, structured search across all member profiles.

Job Postings. Faceted, structured search across all of the available jobs
listed on our network.

Companies. Faceted, structured search of enterprises and professional

organizations.

Groups. Search all professional groups on our network.

Network Updates. Search our networks shared content updates.

Inbox Messages. Search inbox messages.

Addressbook. Detailed, structured search across all of the connections

a member has on LinkedIn.

Influencer Content. Search Influencer posts on LinkedIn by topic or

Influencer name.

Universities. Search all universities on our network.

LinkedIn Contacts. Members can bring all of their contacts from their address books, email accounts, and calendars together and
keep them up to date in one place. Contacts is available both on LinkedIn.com as well as a standalone app for the iPhone.

We also provide other products to help our members develop their professional networks including: Introductions, which allows one
member to request an introduction to another member through a mutual connection; People You May Know, which recommends members
whom you may already know and with whom you may want to create a first degree connection; Addressbook Importer, which allows members
to quickly and easily import contact information from their existing digital address books to LinkedIn; and People Following, which allows
members to follow individuals or groups on LinkedIn.
Access to Knowledge, Insights and Opportunities
Network Updates. Network Updates provide a real-time stream of data from professionals and professional sources, personalized
for each member. The stream allows each member to control and select data by relevancy and remain up-to-date on what is
happening in their professional world.
Pulse. Pulse enables our members to be better informed in their everyday jobs by showing them relevant news that has been
collected and organized by the members in their networks and fellow professionals in their industries.
Influencers. LinkedIn Influencers provides a publishing platform for thought leaders to post unique knowledge and professional
insights on LinkedIn. Members can follow these individuals to receive relevant content directly in their Network Updates and
email. Members can "like" and comment directly on posts and share these insights with their networks.
Groups. Groups provide a forum for our members to discuss topics of interest and meet and interact with other professionals who
share those interests and have opinions and domain expertise in specific areas. Group members are able to discuss, share, comment
and make their group memberships part of their profiles.
Company Pages. Company Pages provide members with a holistic view of a company. By aggregating data across the members
employed at a particular company, we can show which members have recently joined a company, recently changed their title at a
company or recently left a company. Members can also see who they know at a particular company. Companies can add
information to their profiles including information about careers at the company and can highlight specific brands and products via
Showcase Pages. Members can follow companies and automatically receive recent updates and recommend products and services.
Apply with LinkedIn. Apply with LinkedIn enables members to submit their profiles for job applications by clicking the Apply
with LinkedIn button on company websites. Members can choose to update their profiles in
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real time, and members will also be shown their professional connections who work at the company where the profile is submitted.
University Pages. University Pages provide students, prospective students, and alumni access to insights and information on more
than 1,500 universities globally. Members can receive updates on campus news and activities from the schools themselves and
engage with both the campus community and alumni of schools.
LinkedIn Alumni. LinkedIn Alumni provides our members with insights about the alumni of their schools, enabling members to
easily explore alumni career trends, make connections, and find opportunities. The product allows members to dynamically
analyze the career trends of their fellow alumni by providing an interactive tool to view alumni by location, company, and job
function.
Slideshare. Slideshare provides our members with access to the worlds largest community for sharing presentations on the
Internet. Slideshare supports a wide variety of rich media including presentation files, documents, PDFs, videos and webinars.

We also provide other products to help our members access knowledge, insights and opportunities including the Personalization Platform,
which has a number of analytically driven customized products, such as Jobs You May Be Interested In, Groups You May Like, Companies To
Follow, People Who Viewed This Profile Also Viewed and People Who Viewed This Job Also Viewed.
Ubiquitous Access
Because professionals constantly require access to critical information, our platform is accessible online anytime and anywhere,
including on mobile devices.
LinkedIn Mobile. LinkedIn mobile applications are provided across a range of platforms and languages, including iOS for iPhone
and iPad, Android, Blackberry, Nokia Asha, and Windows Mobile.
Robust set of APIs. We believe that every modern business application is more useful and productive if it is personalized according
to a professionals profile and his or her network of connections. In 2009, we launched a public website that allows any developer
to agree to a standard set of guidelines and terms and then integrate our content and services into their applications leveraging
standards-based technology. These applications can be hosted on third-party websites or deployed on our platform. In late 2011, we
announced a Certified Developer Program, which is a network of developers screened to help marketers, agencies and companies
use LinkedIn to connect with their audiences. Third parties are increasingly leveraging our APIs.
Widgets. We provide a set of simple, embeddable widgets for standard features to allow any web developer to include rich content
from our network into their website or application without complex programming. We currently provide the following widgets:

Profile Widget. Displays the public profile of a given member.

Company Insider. Displays information about whom the member

knows at a particular company.

Sharing. Displays a simple button to help members easily share

content with their network.
Recommendation. Displays a simple button to help members easily recommend a product or service offered by a company
to their network.
Alumni Widget. Provides information about whom the member knows from a particular educational institution.
Monetized Solutions
In addition to our free solutions, we also charge for certain solutions that provide members, enterprises and professional organizations
with enhanced functionality and additional benefits.
Talent Solutions
Our Talent Solutions include LinkedIn Corporate Solutions, LinkedIn Jobs and Subscriptions. Our solutions aim to be the most effective
way for enterprises and professional organizations to efficiently identify and acquire the right talent for their needs.
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LinkedIn Corporate Solutions . LinkedIn Corporate Solutions include the following products:
LinkedIn Recruiter . Our flagship talent solution enables enterprises and professional organizations to find, contact and hire
highly qualified passive and active candidates. We believe that a substantial majority of our members are passive in that they are
not actively looking to change jobs. Recruiter provides premium functionality including:
Advanced Searches. Ability to search and view every profile on our network, giving most recruiters access to tens of
millions more profiles than they would have available with our free offering. Advanced searches can be conducted using
keywords found anywhere in a member's profile, such as schools attended and languages spoken, or by data derived from
profiles, such as years of experience.
Project Management. As enterprises and professional organizations find relevant profiles, they are able to organize them
into project folders, add notes, and add reminders for follow-up.
InMail. Enterprises and professional organizations can send messages directly to candidates to tell them more about their
organization or the specific opportunity, subject to the member's discretion.
Collaboration. Recruiters in the same enterprise or professional organization can see which profiles their colleagues have
viewed, saved, or annotated.
Job Slots . A Job Slot entitles an enterprise or professional organization to post a job. The job that is posted can be changed,
updated or modified at any time over the life of the contract.
LinkedIn Recruitment Media . Enterprises and professional organizations can target career-related messaging to qualified
candidates. We provide promotional material in the form of advertisements, videos, or emails to specific audiences defined by
enterprises and professional organizations based on professional profile data.
LinkedIn Career Pages . Enterprises and professional organizations are able to customize the career section of Company Profiles
and content on Career Pages to allow potential candidates to learn more about what it is like to work at the enterprise or
professional organization, whom to contact if they are interested in a position and what relevant opportunities are available.
LinkedIn Talent Pipeline . Enterprises and professional organizations can easily manage all of their talent leads in one place.
LinkedIn Talent Pipeline is available as a standalone solution or as part of Recruiter.
LinkedIn Jobs. Enterprises and professional organizations of all sizes are able to advertise job opportunities on our network. Jobs
includes:
Self-Service Posting. This service enables recruiters and hiring managers to post and manage job opportunities on our network.
TalentMatch . Candidate recommendations are presented to a job poster. Once a job is posted, TalentMatch evaluates the
characteristics of the job and automatically finds the most relevant member profiles. TalentMatch customers can view these
recommendations and directly message relevant candidates.
Jobs You May Be Interested In (JYMBII) . We use profile data to display relevant job postings to members even if they are not
conducting a job search. Job recommendations are displayed on a member's homepage and can also be displayed on other
websites. In addition, companies can highlight job recommendations in JYMBII through Sponsored Jobs.
Work With Us . Enterprises and professional organizations can elect to display the JYMBII module as an add-on to each of their
employee's profiles, allowing them to leverage their employee base to attract relevant candidates.
Subscriptions
Recruiter Lite, Talent Basic, Talent Finder and Talent Pro . The Talent family of products enables recruiters and hiring managers
to find, contact and manage potential candidates, leveraging Premium Search Filters, InMail, Profile Organizer and other premium
features.
Job Seeker Basic, Job Seeker and Job Seeker Plus . The Job Seeker family of products enables members to stand out to recruiters
and hiring managers via the Job Seeker badge, which is visible on their profile and in search results, Featured Applicant status in
the applicant list for jobs they apply to, and InMail.
Marketing Solutions
The goal of our Marketing Solutions is to be the most effective platform for marketers to engage with professionals. We offer marketers
the unique ability to target our premium audience in a high-quality professional context. Our targeting capabilities allow marketers to reach
LinkedIn members according to key attributes such as industry, function, seniority, and company size.
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Enterprise Solutions . These products target larger advertisers which receive dedicated account management and have access to
additional Marketing Solutions:
Display Ads . Advertisers can use the same targeting engine used for LinkedIn Ads to serve ads in a variety of sizes and formats,
including rich media. Additional LinkedIn-specific formats are also available, including Follow Ads, Poll Ads, and SlideShare
Content Ads.
Sponsored InMails . Advertisers can directly reach their target audience with long-form, customized messages through LinkedIns
InMail functionality.
Sponsored Updates. Available via both Enterprise and self-service channels, Sponsored Updates are content-rich promoted updates that
enable advertisers to share and amplify content marketing messages to a targeted audience. Sponsored Updates appear in the desktop and
mobile streams of targeted members.
LinkedIn Ads. Our self-service platform enables advertisers to build and target their advertisement to our members based on information
in their profile. LinkedIn Ads includes the following features:
Targeting. Ads are targeted to specific members based on their profile information. Targetable attributes include the member's title,
function, employer, industry and geography.

Daily Campaign Budgets. A maximum daily budget can be set for

advertisements.
Campaign Management. Advertisers can set up and manage multiple campaigns as well as multiple ad units per campaign.
Reporting. Advertisers can continuously monitor clicks, impressions, click-through rates, average cost-per-click and total budget
spent by ad.
Ads API . LinkedIns Ads API program enables our social ad partners to build custom solutions for creating, managing, and optimizing
LinkedIn Ads and Sponsored Updates campaigns at scale.
Premium Subscriptions
Our Premium Subscription services target small- and medium-sized enterprises and professional organizations, individual members and
business groups in larger enterprises. Our Business, Business Plus and Executive subscription packages are designed for general professionals
to manage their professional identity, grow their business and connect with talent. These subscriptions bundles are sold at different price points.
Key features found in the subscription bundles include:

3rd Degree Name Visibility. Expands network visibility of the searcher by exposing full names for third degree members.

InMail . A message that can be sent directly to a member to whom the

sender is not connected.
Whos Viewed Your Profile Pro . Members see more information about who is viewing their profile, the keywords used by others
members to arrive at their profile, and the number of times they have shown up in search results.

Premium Search Filters . Advanced filters for narrowing a search

based on derived data.

Saved Searches . Members can save a search and be notified when

profiles that fit their criteria are found.

Profile Organizer . A productivity suite allowing members to save and

categorize profiles and add notes.
Sales Navigator. LinkedIn Sales Navigator is a premium social selling solution that provides sales professionals with the ability to
quickly find, qualify and create new opportunities and helps sales management accelerate the social selling capabilities of their
sales organization. It includes the following features:

TeamLink. Allows sales professionals to broaden their network to include everyone on their team, increasing the number
of reachable prospects and allowing them to focus on the best prospects.
Lead Builder & Premium Search. Create lead lists using custom criteria to find new accounts or upload named accounts,
helping sales professionals find the right people faster.
CRM integration. Turn contact records into rich profiles by seeing LinkedIn information directly in Salesforce.com or
Microsoft Dynamics.

Sales, Marketing and Customer Support

Depending on the specific product, we sell our Talent and Marketing Solutions offline through our field sales organization or online on
our website. We sell our Premium Subscriptions primarily online on our website. Our field sales organization uses a direct sales force to solicit
customers and agencies. In the United States, our field sales organization is
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located in Chicago, New York and the San Francisco Bay Area. Outside of the United States, we have additional field sales offices around the
world, including Europe, Asia, South America and the Middle East.
For our Talent Solutions, we divide our field sales organization between account executives who are responsible for new business and
relationship managers who focus on renewing and selling additional seats and solutions to existing customers. Some of our Talent Solutions
products, such as Recruiter Lite, Talent Finder and Job Seeker, are sold through our website.
For our Marketing Solutions, our field sales organization focuses on advertising agencies, large brand advertisers and performance
advertisers that want to target professionals on our website. We also sell our Marketing Solutions to online advertisers that use our automated
online self-service system to establish accounts, create ads, target members, and launch and manage their advertising campaigns.
To date, our member base has grown virally based on members inviting other members to join our network. Through this word-of-mouth
marketing, we have been able to build our brand with relatively low marketing costs. We use the quality of our own products and solutions as
our most effective marketing tool, and word-of-mouth momentum continues to drive member awareness and trust worldwide.
We believe that customer support is critical to retaining and expanding both our member base and customers. Our global customer
operations group responds to both business and technical inquiries from individual members, enterprises and professional organizations relating
to their accounts and how to use our features and products. Self-service support is available through our website and customers can also contact
us via email. We have specific premium support teams dedicated to premium subscribers, online advertisers, and our Talent Solutions
customers.
Customers
Our customers include individuals, enterprises, and professional organizations. No individual customer represented more than 10% of our
net revenue in 2013, 2012 or 2011.
Technology Infrastructure
Our technology platform is designed to create an engaging professional networking experience for our members and is built to enable
future growth at scale. We employ technological innovations whenever possible to increase efficiency and scale our business.
Our products rely upon and leverage the massive amounts of data in our network. This rich dataset has grown exponentially, requiring
scalable computing resources. We will continue to invest in building proprietary technologies and using open sourced technologies for our data,
search and solutions. Our product development expense was $395.6 million , $257.2 million and $132.2 million in 2013, 2012 and 2011,
respectively.
Our key technology platforms are described below:
Professional Graph . Our fully distributed system is comprised of a graph engine where nodes can represent individuals,
companies, schools and other entities and edges can be a connection, a follow, or an employee at a given company. The
professional graph holds an individuals real-time network and enables a variety of complex calls like establishing the degree by
which two nodes are connected (e.g., 2nd degree vs. 3rd degree).
Open Sourced Technologies . We deploy aspects of our technology into the open source community to help increase the speed at
which the technology can mature. The combination of open source and proprietary technologies used in our platforms increases the
speed at which we can deploy our products at scale. For example, Hadoop is an open source project used to batch compute data for
different features on our website based on our members data and traffic patterns. Hadoop enables us to scale our calculations on an
expanding set of data and to perform these calculations more frequently.
Search . Our proprietary search technology combines structured and free-form content to allow users to search across numerous
parameters. Our search is powered by our rich dataset based on facets and keywords and is fundamentally personalized as all
search requests use a members network to affect relevance and ranking. Our search is real time, distributed and multilingual and
serves the needs of both members and enterprises and professional organizations.
Customized Content, Matching, Targeting and Recommendations . We have developed a proprietary intelligence and
recommendation engine for extracting professional insights by utilizing our rich dataset. This engine enables us to provide our
users with customized content and recommendations. For example, based on a members profile, their second and third degree
connections, their viewing and clicking history, and a host of other criteria, our algorithms can provide intelligence and
recommendations around Talent Match, People You May Know, Groups You May Like, Jobs You May Be Interested In, Sponsored
Content or Companies You May Be Interested In. Our
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targeting and recommendation technologies continue beyond just a members profile by providing intelligence around similar
profile views and similar job views.
Ad Targeting Platform . We use a combination of traditional and proprietary ad targeting and delivery technologies. The
combination is optimized to work with our respective partners to provide the optimal user experience. Our proprietary systems
leverage our feature extraction, information retrieval, and matching systems to provide the most relevant ads.
Document Conversion Technologies . We use a combination of open source and proprietary technologies to convert documents in
various formats ( e.g ., pdf, doc, ppt) into HTML5, a mark-up language for structuring and presenting content on the Internet, so
that the document can be displayed on LinkedIn.com and Slideshare.net, and embedded throughout the Internet.
Service Infrastructure . We have invested and are continuing to invest in updating our online applications to our new service
infrastructure, which we believe will improve developer productivity, agility, operability and accelerate our mobile strategy.

Operations
We have developed our website and related infrastructure with the goal of maximizing the availability of our platform to our members,
enterprises and professional organizations. Our website and related infrastructure are hosted on a network located in multiple third-party
facilities, and we lease data center facilities in various locations.
Intellectual Property
We protect our intellectual property rights by relying on federal, state and common law rights, as well as contractual restrictions. We
control access to our proprietary technology, in part, by entering into confidentiality and invention assignment agreements with our employees
and contractors, and confidentiality agreements with third parties.
In addition to these contractual arrangements, we also rely on a combination of trade secrets, copyrights, trademarks, trade dress, domain
names and patents to protect our intellectual property. We pursue the registration of our domain names, trademarks, and service marks in the
United States and in certain locations outside the United States. Our trademarks and registered trademarks in the United States and other
countries include LinkedIn and the in design mark, as well as others. As of December 31, 2013, we owned 39 issued U.S. patents and eight
issued foreign patents/utility models, which expire between 2017 and 2032, as well as 371 pending patent applications in the United States and
internationally.
Circumstances outside our control could pose a threat to our intellectual property rights. For example, effective intellectual property
protection may not be available in the United States or other countries in which our products and solutions are distributed. Also, the efforts we
have taken to protect our proprietary rights may not be sufficient or effective. Any significant impairment of our intellectual property rights
could harm our business or our ability to compete. Also, protecting our intellectual property rights is costly and time-consuming. Any
unauthorized disclosure or use of our intellectual property could make it more expensive to do business and harm our operating results.
Companies in the Internet, social media technology and other industries may own large numbers of patents, copyrights, and trademarks
and may frequently request license agreements, threaten litigation, or file suit against us based on allegations of infringement or other violations
of intellectual property rights. From time to time, we face, and we expect to face in the future, allegations that we have infringed the
trademarks, copyrights, patents and other intellectual property rights of third parties, including our competitors and non-practicing entities. As
we face increasing competition and as our business grows, we will likely face more intellectual property claims.
Competition
We face significant competition in all aspects of our business. In particular, we compete for members, and we also compete for customers
for our Marketing and Talent Solutions, which are typically, enterprises and professional organizations. The bases upon which we compete
differ among these areas as discussed below.
Members-Professional Networks. The market for online professional networks is new and rapidly evolving. Other companies such
as Facebook, Google, Microsoft and Twitter are developing or could develop competing solutions. Further, some of these
companies are partnering with third parties to offer products and services that could compete with ours. We face competition from
a number of smaller companies in international markets, such as Xing in German-speaking regions and Viadeo in France, that
provide online professional networking solutions, as well as Internet companies in the customer relationship management market.
Additionally, we compete against smaller companies that focus on groups of professionals within a specific industry or vertical.
Our competitors may announce new products, services or enhancements that better address changing industry standards or the
needs of members and customers, such as mobile access. Any such increased competition could cause pricing pressure, loss
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of market share or decreased member engagement, any of which could adversely affect our business and operating results. Internet
search engines could also change their methodologies in ways that adversely affect our ability to optimize our page rankings within
their search results.
Enterprises and Professional Organizations-Talent Solutions. With respect to our Talent Solutions, we compete with established
online recruiting companies, such as Monster, CareerBuilder, and Indeed.com (owned by Recruit.net), talent management
companies and larger companies that are focusing on talent management and human resource services, such as Oracle, SAP and
IBM, and traditional recruiting firms. Additionally, other companies, including newcomers to the recruiting industry, may partner
with Internet companies, including social networking companies, to provide services that compete with our solutions, either on
their own or as third party applications. If the efficiency and usefulness of our products to enterprises and professional
organizations do not continue to exceed those provided by competitors, we will not be able to compete successfully. These factors
are influenced by the number and engagement of our members.
Enterprises and Professional Organizations-Marketing Solutions. With respect to our Marketing Solutions, we compete with
online and offline outlets that generate revenue from advertisers and marketers. To the extent competitors are better able to provide
customers with cost-effective access to attractive demographics, either through new business models or increased user volume, we
may not be successful in retaining our existing advertisers or attracting new advertisers.

Additionally, other companies that provide content for professionals could develop more compelling offerings that compete with our
Premium Subscriptions and adversely impact our ability to sell and renew subscriptions to our members. Finally, we are developing our sales
solutions products and we may not be able to compete effectively in this area.
We believe that we have competitive strengths that position us favorably in our markets. However, our industry is evolving rapidly and is
becoming increasingly competitive. Larger and more established companies may focus on professional networking and could directly compete
with us. Smaller companies could also launch new products and services that we do not offer and that could gain market acceptance quickly.
Government Regulation
We are subject to a number of foreign and domestic laws and regulations that affect companies conducting business online, many of
which are still evolving and could be interpreted in ways that could harm our business. In the United States and abroad, laws relating to the
liability of providers of online services for activities of their users and other third parties are currently being tested by a number of claims,
including actions based on invasion of privacy and other torts, unfair competition, copyright and trademark infringement, and other theories
based on the nature and content of the materials searched, the ads posted, or the content provided by users. Any court ruling or other
governmental action that imposes liability on providers of online services for the activities of their users and other third parties could harm our
business. In addition, rising concern about the use of social networking technologies for illegal conduct, such as the unauthorized dissemination
of national security information, money laundering or supporting terrorist activities, may in the future produce legislation or other
governmental action that could require changes to our products or services, restrict or impose additional costs upon the conduct of our business
or cause users to abandon material aspects of our service.
In the area of information security and data protection, most states have passed laws requiring notification to users when there is a
security breach for personal data, such as the 2002 amendment to Californias Information Practices Act, or requiring the adoption of minimum
information security standards that are often vaguely defined and difficult to practically implement. The costs of compliance with these laws
may increase in the future as a result of changes in interpretation. Furthermore, any failure on our part to comply with these laws may subject
us to significant liabilities.
We are also subject to federal, state, and foreign laws regarding privacy and protection of member data. Our privacy policy and user
agreement describe our practices concerning the use, storage, transmission and disclosure of member data. Any failure by us to comply with
these terms or privacy related laws and regulations could result in proceedings against us by governmental authorities or others, which could
harm our business. In addition, the interpretation of privacy and data protection laws, and their application to online services is unclear,
evolving and in a state of flux. There is a risk that these laws may be interpreted and applied in conflicting ways from state to state, country to
country, or region to region, and in a manner that is not consistent with our current data protection practices, or that new regulations will be
enacted. Complying with these varying domestic and international requirements could cause us to incur additional costs and change our
business practices. Further, any failure by us to adequately protect our members privacy and data could result in a loss of member confidence
in our services and ultimately in a loss of members and customers, which could adversely affect our business.
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In addition, because our services are accessible worldwide, certain foreign jurisdictions have claimed and others may claim that we are
required to comply with their laws, including with respect to the storage, use and disclosure of member information, even in jurisdictions where
we have no local entity, employees, or infrastructure.
Our Values and Company Culture
Our values and unique company culture serve as the foundation to our success. Our values are the principles by which we manage our
day-to-day business and facilitate decision-making. Our core values are:
Our Members Come First. We encourage employees to know and understand our members and to ensure that we foster the longterm vitality of the LinkedIn ecosystem.
Relationships Matter. By fostering trust with colleagues and partners, we all succeed. We fundamentally believe that doing what is
right is more important than being right. We manage compassionately by recognizing that people have experiences and
perspectives that may differ from our own.
Be Open, Honest and Constructive. We expect our employees to communicate with clarity and provide feedback with consistency
in a constructive way.
Demand Excellence. Our employees are encouraged to lead by example, seek to solve big challenges, set measureable and
actionable goals, and continuously learn, iterate and improve.
Take Intelligent Risks. Taking intelligent risks has been paramount in building the company to date. No matter how large the
company becomes we strive to never lose our startup mentality.
Act Like an Owner. Talent is our most important asset. We expect employees to act as an owner in each decision they make, no
matter how big or small.
Our company culture reflects who we are and the company we aspire to be. Our culture is shaped in large part by our values and is best
defined by:
Transformation. People who work at LinkedIn are here because they seek to make a positive and lasting impact on the world, help
realize the full potential of LinkedIn and fundamentally alter the trajectory of their careers.
Integrity. We dont believe the ends justify the means. Rather, we expect employees to do the right thing no matter what.
Collaboration. Much like the network effects inherent in our business model, we believe that as valuable as we are as individuals,
we are all exponentially more valuable when aligned and working together.
Humor. Fulfilling our mission and vision requires an intense focus, so we believe it is important to not take ourselves too seriously
and try to have some fun while doing it.
Results. We set clear, actionable goals and have high expectations for our performance. We count on our employees to consistently
deliver excellent results, seek leverage through greater efficiency and effectiveness, and demonstrate leadership at all levels
throughout the organization.
We believe we have assembled an extremely talented group of employees and strive to hire the best employees to solve very significant
challenges. As of December 31, 2013, we had 5,045 employees, consisting of 2,171 employees in engineering, product development and
customer operations, 2,159 employees in sales and marketing, and 715 employees in general and administrative.
While we encourage collaboration, we also embrace individual thinking and creativity. For example, one of our key approaches to
attracting and retaining technical talent and fostering continued innovation is through our company-sponsored inDays and hackdays where
our employees are encouraged to take the time to explore and implement new ideas. Participants then present their ideas in front of the whole
company with prizes awarded for the best ideas. Some of our significant new products have been developed as a result of inDays and hackdays.
Information about Segment and Geographic Revenue
Information about segment and geographic revenue is set forth in Note 13 of the Notes to Consolidated Financial Statements under
Item 8 of this Annual Report on Form 10-K.
Seasonality
Our business is affected by both cyclicality in business activity, and seasonal fluctuations in Internet usage. We believe our rapid growth
has masked the cyclicality and seasonality of our business. As our revenue growth rate slows, we expect that the cyclicality and seasonality in
our business may become more pronounced and may in the future cause our operating results
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to fluctuate. In particular, we expect new business and renewals of Talent Solutions to be stronger in the fourth quarter of the year due to
budgetary cycles and our Marketing Solutions business to be stronger in the second and fourth quarter of the year in alignment with industry
advertising spending.
Available Information
Our website is located at www.linkedin.com, and our investor relations website is located at http://investors.linkedin.com/. The following
filings are available free of charge through our investor relations website after we file them with the SEC: Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q, and our Proxy Statements for our annual meetings of stockholders.
We webcast our earnings calls and certain events we participate in or host with members of the investment community on our investor
relations website. Additionally, we provide notifications of news or announcements regarding our financial performance, including SEC filings,
investor events, press and earnings releases, and blogs as part of our investor relations website. Investors and others can receive notifications of
new information posted on our investor relations website in real time by signing up for email alerts and RSS feeds. Further corporate
governance information, including our certificate of incorporation, bylaws, governance guidelines, board committee charters, and code of
conduct, is also available on our investor relations website under the heading Corporate Governance. The contents of our websites are not
intended to be incorporated by reference into this Annual Report on Form 10-K or in any other report or document we file with the SEC, and
any references to our websites are intended to be inactive textual references only.
Item 1A.

Risk Factors

Investing in our Class A common stock involves a high degree of risk. You should carefully consider the risks and uncertainties described
below, together with all of the other information in this Annual Report on Form 10-K, including our consolidated financial statements and
related notes, before deciding whether to purchase shares of our Class A common stock. If any of the following risks are realized, our business,
operating results and prospects could be materially and adversely affected. In that event, the price of our Class A common stock could decline,
and you could lose part or all of your investment.
Risks Related to Our Business
We have a limited operating history in new and unproven markets, which makes it difficult to evaluate our future prospects and may
increase the risk that we will not be successful.
We have a limited operating history in new and unproven markets that may not develop as expected. This limited operating history makes
it difficult to effectively assess or forecast our future prospects. You should consider our business and prospects in light of the risks and
difficulties we encounter or may encounter in these rapidly evolving markets. These risks and difficulties include our ability to, among other
things:

hire, integrate and retain world class talent;

continue to earn and preserve our members trust with respect to their professional reputation and information;
develop and maintain scalable, high-performance technology infrastructure that can efficiently and reliably handle increased member
usage globally while also implementing appropriate localization, as well as the deployment of new features and products;
avoid interruptions or disruptions in our service or slower than expected load times for our services;
increase our number of members and member engagement;
responsibly use the data that our members share with us to provide solutions that make our members more productive and successful
and that are critical to the talent, marketing and sales needs of enterprises and professional organizations;
process, store, protect and use personal data in compliance with governmental regulations, contractual obligations and other legal
obligations related to privacy and security;
halt the operations of websites that aggregate our data as well as data from other companies, or copycat websites that have
misappropriated our data;
increase revenue from the solutions we provide;
successfully adapt to mobile markets and optimize services for mobile
devices;
successfully expand our business in markets outside the United States;
successfully compete with other companies that are currently in, or may in the future enter, the online professional networking space;
and
defend ourselves against litigation, regulatory, intellectual property, privacy and other claims.

If the market for online professional networks does not develop as we expect, or if we fail to address the needs of this market, our
business will be harmed. We may not be able to successfully address these risks and difficulties or others, including those described elsewhere
in these risk factors. Failure to adequately address these risks and difficulties could harm our business and cause our operating results to suffer.

We may not timely and effectively scale and adapt our existing technology and network infrastructure to ensure that our services and
solutions are accessible within an acceptable load time. Additionally, natural disasters or other catastrophic occurrences beyond our control
could interfere with access to our services.
A key element to our continued growth is the ability of our members, users (whom we define as anyone who visits one of our websites
through a computer or application on a mobile device, regardless of whether or not they are a member), enterprises and professional
organizations in all geographies to access our websites, services and solutions within acceptable load times. We call this website performance.
We have experienced, and may in the future experience, service disruptions, outages and other performance problems due to a variety of
factors, including infrastructure changes, human or software errors, capacity constraints due to an overwhelming number of users accessing our
services simultaneously, and denial of service or fraud or security attacks. In some instances, we may not be able to identify the cause or causes
of these website performance problems within an acceptable period of time. We expect it will become increasingly difficult to maintain and
improve our website performance, especially during peak usage times and as our solutions become more complex and our total user traffic
increases. If our services are unavailable when users attempt to access them or they do not load as quickly as users expect, users may seek other
websites or services to obtain the information for which they are looking, and may not return to our website or use our services as often in the
future, or at all. This would negatively impact our ability to attract members,
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enterprises and professional organizations and increase engagement of our members and users. We expect to continue to make significant
investments to maintain and improve website performance and to enable rapid releases of new features and products. To the extent that we do
not effectively address capacity constraints, upgrade our systems as needed and continually develop our technology and network architecture to
accommodate actual and anticipated changes in technology, our business and operating results may be harmed.
We have implemented a disaster recovery program, which allows us to move production to a back-up data center in the event of a
catastrophe. Although this program is functional, it does not yet provide a real-time back-up data center, so if our primary data center shuts
down, there will be a period of time that our services will remain shut down while the transition to the back-up data center takes place.
Our systems are also vulnerable to damage or interruption from catastrophic occurrences such as earthquakes, floods, fires, power loss,
telecommunication failures, terrorist attacks and similar events. Our U.S. corporate offices and certain of the facilities we lease to house our
computer and telecommunications equipment are located in the San Francisco Bay Area and Southern California, both regions known for
seismic activity. Despite any precautions we may take, the occurrence of a natural disaster or other unanticipated problems at our hosting
facilities could result in lengthy interruptions in our services.
We do not carry business interruption insurance sufficient to compensate us for the potentially significant losses, including the potential
harm to the growth of our business that may result from interruptions in our service as a result of system failures.
If our security measures are compromised, or if our websites are subject to attacks that degrade or deny the ability of members or customers
to access our solutions, or if our member data is compromised, members and customers may curtail or stop use of our solutions.
Our solutions involve the collection, processing, storage, sharing, disclosure and usage of members and customers information and
communications, some of which may be private. We are vulnerable to computer viruses, break-ins, phishing attacks, attempts to overload our
servers with denial-of-service or other attacks and similar disruptions from unauthorized use of our computer systems, any of which could lead
to interruptions, delays, or website shutdowns, causing loss of critical data or the unauthorized disclosure or use of personally identifiable or
other confidential information. For example, in June 2012, approximately 6.5 million of our members encrypted passwords were stolen and
published on an unauthorized website. We also work with third party vendors to process credit card payments by our customers and are subject
to payment card association operating rules. If we experience compromises to our security that result in website performance or availability
problems, the complete shutdown of our websites, or the loss or unauthorized disclosure of confidential information, such as credit card
information, our members or customers may be harmed or lose trust and confidence in us, and decrease the use of our website and services or
stop using our services in their entirety, and we would suffer reputational and financial harm.
In addition, we are, and in the future could be, subject to regulatory investigations and litigation in connection with a security breach or
related issue, and we could also be liable to third parties for these types of breaches. Such litigation, regulatory investigations and our technical
activities intended to prevent future security breaches are likely to require additional management resources and expenditures. If our security
measures fail to protect this information adequately or we fail to comply with the applicable credit card association operating rules, we could be
liable to both our customers for their losses, as well as the vendors under our agreements with them, we could be subject to fines and higher
transaction fees, we could face regulatory action, and our customers and vendors could end their relationships with us, any of which could harm
our business and financial results.
Our core value of putting our members first may conflict with the short-term interests of our business.
One of our core values is to make decisions based on the best long-term interests of our members, which we believe is essential to our
success in increasing our member growth rate and engagement and in serving the best, long-term interests of the company and our
stockholders. Therefore, in the past, we have forgone, and may in the future forgo, certain expansion or short-term revenue opportunities that
we do not believe are in the best interests of our members, even if our decision negatively impacts our operating results in the short term. In
addition, as part of our philosophy of putting our members first, as long as our members are adhering to our terms of service, this philosophy
may cause disagreements, or negatively impact our relationships, with our existing or prospective customers. This could result in enterprises
and professional organizations blocking access to our services or refusing to purchase our Talent or Marketing Solutions or Premium
Subscriptions. Our decisions may not result in the long-term benefits that we expect, in which case our member engagement, business and
operating results could be harmed.
The number of our registered members is higher than the number of actual members and a substantial majority of our page views are
generated by a minority of our members. Our business may be adversely impacted if we are unable to attract and
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retain additional members who actively use our services. In addition, the tracking of certain of our performance metrics is done with
internal tools and is not independently verified.
The number of registered members in our network is higher than the number of actual members because some members have multiple
registrations, other members have died or become incapacitated, and others may have registered under fictitious names or created fraudulent
accounts. While the number of registered members represents what we believe to be reasonable estimates of our member base, there are
inherent challenges in ensuring that the number of registered members presents an accurate reflection of our member network. For example, we
do not have a reliable system for identifying and counting duplicate or fraudulent accounts, or deceased, incapacitated or other non-members
and so we rely on estimates and assumptions. In addition, our methodology for measuring our membership numbers, and specifically for
making estimates regarding non-members who should not be included as registered members, has changed over time and may continue to
change from time to time. While we are using what we believe to be accurate methods of measuring the number of registered members, there
are no methodologies available that would provide us with an exact number of non-actual member types of accounts. Therefore, we cannot
assure you that our current or future methodologies are accurate, and we will need to continue to adjust them in the future from time to time,
which could result in the number of registered members being lower or higher than expected. Further, a substantial majority of our members do
not visit our website on a monthly basis, and a substantial majority of our page views are generated by a minority of our members.
If the number of our actual members does not meet our expectations, if the rate at which we add new members slows or declines or if we
are unable to increase the breadth and frequency of our visiting members, then our business may not grow as fast as we expect. In addition, we
track certain performance metrics with internal tools, which are not independently verified by any third party. The tracking of this information
has a number of limitations, including reliance on estimates and assumptions, which may not be accurate. Our methodologies for tracking these
metrics may also change over time, which could result in unexpected changes to our metrics. If the internal tools we use to track these metrics
undercount or overcount performance, the data we report may not be accurate. This may harm our operating and financial results and may
cause our stock price to decline.
If our members profiles are out-of-date, inaccurate or lack the information that users and customers want to see, we may not be able to
realize the full potential of our network, which could adversely impact the growth of our business.
If our members do not update their information or provide accurate and complete information when they join LinkedIn, or do not
establish sufficient connections, the value of our network may be negatively impacted because our value proposition as a professional network
and as a source of accurate and comprehensive data will be weakened. For example, customers of our Talent Solutions may not find members
that meet their qualifications or may misidentify a candidate as having such qualifications, which could result in mismatches that erode
customer confidence in our solutions. Similarly, incomplete or outdated member information would diminish the ability of our Marketing
Solutions customers to reach their target audiences and our ability to provide our customers with valuable insights. Therefore, we must provide
features and products that demonstrate the value of our network to our members and motivate them to contribute additional, timely and
accurate information to their profile and our network. If we fail to successfully motivate our members to do so, our business and operating
results could be adversely affected.
Many individuals use mobile devices to access online services. If users of these devices do not widely adopt solutions we develop for these
devices, our business could be adversely affected.
The number of people who access online services through mobile devices, as opposed to personal computers, such as smart phones,
handheld tablets and mobile telephones, has increased dramatically in the past few years and is projected to continue to increase. If the mobile
solutions we have developed do not meet the needs of our members or customers, they may reduce their usage of our platform and our business
could suffer. Additionally, we are dependent on the interoperability of LinkedIn with popular mobile operating systems that we do not control,
such as Android and iOS, and any changes in such systems and terms of service that degrade our solutions functionality, give preferential
treatment to competitive products or prevent our ability to promote advertising could adversely affect engagement and monetization on mobile
devices. As new devices and new platforms are continually being released, it is difficult to predict the challenges we may encounter in
developing versions of our solutions for use on these alternative devices, and we are devoting significant resources to the support and
maintenance of such devices.
Growth in access to LinkedIns services through mobile devices as a substitute for access on personal computers may negatively affect our
revenue and financial results.
Because access to online services through mobile devices is growing, our members are increasingly accessing LinkedIn on mobile
devices. While many of our members who use our online services on mobile devices also access LinkedIn through personal computers, as we
have developed our mobile solutions, we have seen substantial growth in mobile usage, and we anticipate that the rate of growth in mobile
usage will continue to grow. Advertising is a source of revenue for us, and it is not
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clear that we will be able find ways for our Marketing Solutions product to be effectively used on mobile devices. Historically, our Marketing
Solutions products have not been made widely available on mobile products, and subsequently have not generated a material amount of
revenue. We are devoting valuable resources to solutions related to monetization of mobile usage, and have only recently launched these
solutions. We cannot assure you that these solutions will be successful. If our members increasingly use mobile devices as a substitute for
access to our online services as opposed to personal computers, and if we are unable to successfully implement monetization strategies for our
solutions on mobile devices, or these strategies are not as successful as our offerings for personal computers, or if we incur excessive expenses
in this effort, our financial performance and ability to grow revenue would be negatively affected.
We collect, process, store, share, disclose and use personal information and other data, which subjects us to governmental regulations and
other legal obligations related to privacy and security, and our actual or perceived failure to comply with such obligations could harm our
business.
We collect, process, store, share, disclose and use information from and about our members, customers and users, including personal
information and other data, and we enable our members to passively and proactively share their personal information with each other and with
third parties and to communicate and share news and other information into and across our platform. There are numerous federal, state and
local laws around the world regarding privacy and the collection, storing, sharing, using, processing, disclosing and protecting of personal
information and other data from and about our members, the scope of which are changing, subject to differing interpretations, and which may
be costly to comply with and may be inconsistent among countries and jurisdictions or conflict with other rules. In addition, governmental
agencies may request or take member or customer data for security or informational purposes. We generally comply with industry standards
and are subject to the terms of our privacy policies and privacy-related obligations to third parties (including voluntary third-party certification
bodies such as TRUSTe). We strive to comply with applicable laws, policies, and legal obligations and certain applicable industry codes of
conduct relating to privacy and data protection. However, these obligations may be interpreted and applied in new ways and/or in a manner that
is inconsistent from one jurisdiction to another and may conflict with other rules or our practices. In addition, privacy and data security is an
active area and new regulations are likely to be enacted.
Any failure or perceived failure by us to comply with our privacy policies, our privacy-related obligations to members, customers or
other third parties, or our privacy-related legal obligations, or any compromise of security that results in the unauthorized release or transfer of
personal or other information, which may include personally identifiable information or other member data, may result in governmental
enforcement actions, litigation or public statements against us by consumer advocacy groups or others and could cause our members and
customers to lose trust in us, which could have an adverse effect on our business. Additionally, if third parties we work with, such as customers,
vendors or developers, violate applicable laws, our policies or other policy-related obligations, such violations may also put our members
information at risk and could in turn have an adverse effect on our business.
Public scrutiny of Internet privacy and security issues may result in increased regulation and different industry standards, which could
deter or prevent us from providing our current products and solutions to our members and customers, thereby harming our business.
The regulatory framework for privacy and security issues worldwide is evolving and is likely to remain in flux so for the foreseeable
future. Practices regarding the collection, use, storage, display, processing, transmission and security of personal information by companies
offering online services have recently come under increased public scrutiny. The U.S. government, including the White House, the Federal
Trade Commission, the Department of Commerce and many state governments, are reviewing the need for greater regulation of the collection,
use and storage of information concerning consumer behavior with respect to online services, including regulation aimed at restricting certain
targeted advertising practices and collection and use of data from mobile devices. The FTC in particular has approved consent decrees
resolving complaints and their resulting investigations into the privacy and security practices of a number online, social media companies.
Similar actions may also impact LinkedIn directly. In addition, the European Union is in the process of promulgating a new General Data
Protection Regulation, which may result in significantly greater compliance burdens for companies with users and operations in Europe.
Various government and consumer agencies have also called for new regulation and changes in industry practices. Recently, the State of
California and other states passed laws relating to disclosure of companies practices with regard to Do-Not-Track signals from Internet
browsers, the ability to delete information of minors, and new definitions that may impact data breach notification requirements. California and
several other states have also adopted privacy guidelines with respect to mobile applications. In addition, government agencies and regulators
have reviewed, are reviewing and will continue to review, our privacy policy and practices. These reviews can and have resulted in
recommended changes to our products, and could result in additional recommendations in the future. If we are unable to comply with such
recommendations, or if the recommended changes result in degradation of our products, our business could be harmed.
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Our business, including our ability to operate and expand internationally or on new technology platforms, could be adversely affected if
legislation or regulations are adopted, interpreted, or implemented in a manner that is inconsistent with our current business practices and that
require changes to these practices, the design of our websites, mobile applications, products, features or our privacy policy. In particular, the
success of our business has been, and we expect will continue to be, driven by our ability to responsibly use the data that our members share
with us. Therefore, our business could be harmed by any significant change to applicable laws, regulations or industry standards or practices
regarding the storage, use or disclosure of data our members choose to share with us, or regarding the manner in which the express or implied
consent of consumers for such use and disclosure is obtained. Such changes may require us to modify our products and features, possibly in a
material manner, and may limit our ability to develop new products and features that make use of the data that we collect about our members.
Our business is subject to a variety of U.S. and foreign laws, many of which are unsettled and still developing and which could subject us to
claims or otherwise harm our business.
We are subject to a variety of laws in the United States and abroad, including laws regarding privacy, data protection, data security, data
retention and consumer protection and the provision of online payment services that are continuously evolving and developing. In addition,
some of our members are subject to laws and/or licensing or certification obligations that may restrict their ability to engage with LinkedIns
online services. The scope and interpretation of the laws and other obligations that are or may be applicable to us or certain groups of our
members are often uncertain and may be conflicting, particularly laws and other obligations outside the United States. For example, laws
relating to the liability of providers of online services for activities of their users and other third parties are currently being tested pursuant to
actions based on, among other things, invasion of privacy and other torts, unfair competition, copyright and trademark infringement, and other
theories based on the nature and content of the materials searched, the ads posted, or the content provided by users.=. In addition, regulatory
authorities around the world are considering a number of legislative and regulatory proposals concerning privacy, data storage, data protection
and other matters that may be applicable to our business. Compliance with these laws may require substantial investment or may provide
technical challenges for our business. It is also likely that as our business grows and evolves and our solutions are used in a greater number of
countries and additional groups, we will become subject to laws and regulations in additional jurisdictions. Further, as our services and
solutions expand to include more content (including from third parties), additional laws and regulations may become applicable to our products
and offerings including laws requiring us to restrict the availability of such content on a geographical basis or to certain groups of members. In
some cases, laws and legal obligations of various jurisdictions may be ambiguous or conflict as to LinkedIns right to display and distribute
certain content as part of its online services. Users of our site and our solutions could also abuse or misuse our products in ways that violate
laws. It is difficult to predict how existing laws will be applied to our business and the new laws and legal obligations to which we may become
subject.
If we are not able to comply with these laws or other legal obligations or if we (or our members) become liable under these laws or legal
obligations, we could be directly harmed, and we may be forced to implement new measures to reduce exposure to this liability. This may
require us to expend substantial resources or to discontinue certain solutions, which would negatively affect our business, financial condition
and results of operations. In addition, the increased attention focused upon liability issues as a result of lawsuits and legislative proposals could
harm our reputation or otherwise impact the growth of our business. Any costs incurred as a result of this potential liability could harm our
business and operating results.
We expect our operating results to fluctuate on a quarterly and annual basis, which may result in a decline in our stock price if such
fluctuations result in a failure to meet the expectations of securities analysts or investors.
Our revenue and operating results could vary significantly from quarter-to-quarter and year-to-year and may fail to match our past
performance, our projections or the expectations of securities analysts because of a variety of factors, many of which are outside of our control.
Any of these events could cause the market price of our Class A common stock to fluctuate. Factors that may contribute to the variability of our
operating results include:

our ability to increase our member base and member engagement;

disruptions or outages in the availability of our websites or services, actual or perceived breaches of privacy, and compromises of
our member data;
our commitment to putting our members first even if it means forgoing short-term revenue opportunities;
shifts in the way members and users access our websites and services from personal computers to mobile devices;
the unproven nature of our business model;
changes in our pricing policies or those of our competitors;
our ability to increase sales of our products and solutions to new customers and expand sales of additional products and solutions
to our existing customers;
the size and seasonal variability of our customers recruiting and
marketing budgets;
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the extent to which existing customers renew their agreements with us and the timing and terms of those renewals;
macroeconomic changes, in particular, deterioration in labor markets, which would adversely impact sales of our Talent
Solutions, or economic growth that does not lead to job growth, for instance increases in productivity;
the cost of investing in our technology infrastructure, product initiatives and international expansion may be greater than we
anticipate;
expenses related to hiring, incentivizing and retaining employees;
the timing and costs of expanding our field sales organization and delays or inability in achieving expected productivity;
the timing of certain expenditures, including hiring of employees and
capital expenditures;
the entrance of new competitors in our market whether by established companies or the entrance of new companies; and
general industry and macroeconomic conditions.

Given our limited operating history and the rapidly evolving market of online professional networks, our historical operating results may
not be useful to you in predicting our future operating results. We believe our rapid growth has masked the cyclicality and seasonality of our
business. As our revenue growth rate slows, we expect that the cyclicality and seasonality in our business may become more pronounced and
may in the future cause our operating results to fluctuate. In particular, we expect sales of Talent Solutions to be weaker in the first quarter of
the year due to budgetary cycles and sales of our Marketing Solutions to be weaker in the third quarter of the year as use of online services
during the summer months generally slows. In addition, global economic concerns continue to create uncertainty and unpredictability and add
risk to our future outlook. Sovereign debt issues and economic uncertainty in the United States, Europe and around the world raise concerns in
markets important to our business. An economic downturn in any particular region in which we do business or globally could result in
reductions in sales of our Talent Solutions and Marketing Solutions, decreased renewals of existing arrangements and other adverse effects that
could harm our operating results.
We expect our revenue growth rate to decline, and, as our costs increase, we may not be able to generate sufficient revenue to sustain our
profitability over the long term.
From 2008 to 2013 , our annual net revenue grew from $78.8 million to $1,528.5 million , which represents a compounded annual growth
rate of approximately 81%. As our net revenue has increased, our revenue growth rate has slowed, and we expect that it will continue to decline
over time. We also expect that the growth rates of each of our three primary business lines will fluctuate and that these business lines may not
grow at the same rate. As with 2013, our philosophy in 2014 is to continue to invest for future growth. We expect to continue to expend
substantial financial and other resources on:

our technology infrastructure, including architecture, development tools scalability, availability, performance and security, as well as
disaster recovery measures;

product development, including investments in our product development team and the development of new features for both members
and customers, including those for mobile use and our sales solutions products;

sales and marketing, including a significant expansion of our field sales organization;

international expansion in an effort to increase our member base, engagement and sales;

general administration, including legal and accounting expenses related to being a public company with an expanding global
presence; and

capital expenditures, including facilities.

These investments may not result in increased revenue or growth in our business, and will increase our expenses. Even if our revenue continues
to increase, we expect that due to increased expenses, in particular, stock-based compensation, depreciation and amortization and provision for
income taxes, we may incur a GAAP loss during future periods, including the first quarter of 2014. If we fail to continue to grow our revenue
and overall business, our operating results and business would be harmed.
We expect to face increasing competition in the market for online professional networks from social networking sites and Internet search
companies, among others, as well as continued competition for customers of our Talent Solutions and Marketing Solutions.
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We face significant competition in all aspects of our business, and we expect such competition to increase, particularly in the market for
online professional networks and engagement of professionals.
Our industry is evolving rapidly and is becoming increasingly competitive. Larger and more established companies may focus on our
market and could directly compete with us. Smaller companies, including application developers, could also launch new products and services
that compete with us and that could gain market acceptance quickly. We also expect our existing competitors in the markets for Talent Solutions
and Marketing Solutions to continue to focus on these areas. A number of these companies may have greater resources than us, which may
enable them to compete more effectively. Specifically, we are investing significantly in our Marketing Solutions products with respect to
mobile solutions, and we may not be successful in generating revenue through advertising on mobile devices, especially as compared to our
competitors. Additionally, users of social networks may choose to use, or increase their use of, those networks for professional purposes, which
may result in those users decreasing or eliminating their use of LinkedIn. Companies that currently focus on social networking could also
expand their focus to professionals. We and other companies have historically established alliances and relationships with some of these
companies to allow broader exposure to users and access to data on the Internet. We may also, in the future, establish alliances or relationships
with other competitors or potential competitors. To the extent companies terminate such relationships and establish alliances and relationships
with others, our business could be harmed. Specifically, we compete for members, enterprises and professional organizations as discussed
below.
Members-professional networks . The market for online professional networks is new and rapidly evolving. Other companies such as
Facebook, Google, Microsoft and Twitter are developing or could develop competing solutions. Further, some of these companies are
partnering with third parties to offer products and services that could compete with ours. We face competition from a number of smaller
companies in international markets, such as Xing in German-speaking regions and Viadeo in France, that provide online professional
networking solutions, as well as Internet companies in the customer relationship management market. Additionally, we compete against smaller
companies that focus on groups of professionals within a specific industry or vertical. Our competitors may announce new products, services or
enhancements that better address changing industry standards or the needs of members and customers, such as mobile access. Any such
increased competition could cause pricing pressure, loss of market share or decreased member engagement, any of which could adversely
affect our business and operating results. Internet search engines could also change their methodologies in ways that adversely affect our ability
to optimize our page rankings within their search results.
Enterprises and professional organizations-Talent Solutions . With respect to our Talent Solutions, we compete with established online
recruiting companies, such as Monster, CareerBuilder, and Indeed.com (owned by Recruit.net), talent management companies and larger
companies that are focusing on talent management and human resource services, such as Oracle, SAP and IBM, and traditional recruiting firms.
Additionally, other companies, including newcomers to the recruiting industry, may partner with Internet companies, including social
networking companies, to provide services that compete with our solutions, either on their own or as third party applications. If the efficiency
and usefulness of our products to enterprises and professional organizations do not continue to exceed those provided by competitors, we will
not be able to compete successfully. These factors are influenced by the number and engagement of our members.
Enterprises and professional organizations-Marketing Solutions . With respect to our Marketing Solutions, we compete with online and
offline outlets that generate revenue from advertisers and marketers. To the extent competitors are better able to provide customers with costeffective access to attractive demographics, either through new business models or increased user volume, we may not be successful in
retaining our existing advertisers or attracting new advertisers, and our business would be harmed.
Additionally, other companies that provide content for professionals could develop more compelling offerings that compete with our
Premium Subscriptions and adversely impact our ability to sell and renew subscriptions to our members. Finally, we are developing our sales
solutions products and we may not be able to compete effectively in this area.
If we fail to effectively manage our growth, our business and operating results could be harmed.
We continue to experience rapid growth in our headcount and operations, which will continue to place significant demands on our
management and our operational and financial infrastructure. As of December 31, 2013, approximately 38% of our employees had been with us
for less than one year and approximately 87% for less than two years. As we continue to grow, we must effectively integrate, develop and
motivate a large number of new employees in various countries around the world, and we must maintain the beneficial aspects of our corporate
culture. In particular, we intend to continue to make substantial investments to expand our engineering, research and development, field sales,
and general and administrative organizations, and our international operations. To attract top talent, we have had to offer, and believe we will
need to continue to offer, highly competitive compensation packages before we can validate the productivity of those employees. The
significant increase in the price of our Class A common stock since we became a public company in 2011 may make it more difficult or costly
in the
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future to use equity compensation to motivate, incentivize and retain our employees. We face significant competition for talent from other
Internet and high-growth companies, which include both publicly traded and privately-held companies. As we have transitioned from a private
company to a public company, this competition has become even more acute in assessing appropriate compensation packages, particularly,
determining the mix of cash and equity compensation. The risks of over-hiring (especially given overall macroeconomic risks) or overcompensating and the challenges of integrating a rapidly growing employee base into our corporate culture are exacerbated by our international
expansion, and because of our growth, we have significantly expanded our operating lease commitments, which has increased our expenses.
We may not be able to hire new employees quickly enough to meet our needs. If we fail to effectively manage our hiring needs and
successfully integrate our new hires, our efficiency and ability to meet our forecasts and our employee morale, productivity and retention could
suffer, and our business and operating results could be adversely affected.
Additionally, if we do not effectively manage the growth of our business and operations, the quality of our solutions could suffer, which
could negatively affect our brand, operating results and overall business. Further, we have made changes in the past, and will make changes in
the future, to our features, products and services that our members or customers may not like, find useful or agree with. We may also decide to
discontinue certain features, products or services, or charge for certain features, products or services that are currently free or increase fees for
any of our features, products or services. If members or customers are unhappy with these changes, they may decrease their engagement on our
site, or stop using features, products or services or the site generally. They may, in addition, choose to take other types of action against us such
as organizing petitions or boycotts focused on our company, our website or any of our services, filing claims with the government or other
regulatory bodies, or filing lawsuits against us. Any of these actions could negatively impact our member growth and engagement and our
brand, which would harm our business. To effectively manage this growth, we will need to continue to improve our operational, financial and
management controls, and our reporting systems and procedures by, among other things:

improving our information technology infrastructure to maintain the effectiveness of our solutions;
enhancing information and communication systems to ensure that our employees and offices around the world are wellcoordinated and can effectively communicate with each other and our growing base of members, enterprises and professional
organizations;
enhancing our internal controls to ensure timely and accurate reporting of all of our operations; and
appropriately documenting our information technology systems and
our business processes.

These systems enhancements and improvements will require significant capital expenditures and allocation of valuable management and
employee resources. If we fail to implement these improvements effectively, our ability to manage our expected growth and comply with the
rules and regulations that are applicable to publicly reporting companies will be impaired.
Our international operations are subject to increased challenges and risks.
We have offices around the world and our websites and mobile applications are available in numerous other languages. For the year
ended December 31, 2013 , international revenue represented 38% of our total revenue. We expect to continue to expand our international
operations in the future by opening offices in new jurisdictions and expanding our offerings in new languages. However, we have limited
operating history as a company outside the United States, and our ability to manage our business and conduct our operations internationally
requires considerable management attention and resources and is subject to the particular challenges of supporting a rapidly growing business
in an environment of multiple languages, cultures, customs, legal systems, alternative dispute resolution systems, regulatory systems and
commercial infrastructures. International expansion has required and will continue to require us to invest significant funds and other resources.
Operating internationally subjects us to new risks and may increase risks that we currently face, including risks associated with:

recruiting and retaining talented and capable employees in foreign countries and maintaining our company culture across all of
our offices;
providing solutions across a significant distance, in different languages and among different cultures, including potentially
modifying our solutions and features to ensure that they are culturally relevant in different countries, which may include
modifying content in certain jurisdictions if it may be considered objectionable;
increased competition from local websites and services, that provide online professional networking solutions, such as Germanybased Xing and France-based Viadeo, and online recruitment services, such as Australia-based Seek and Japan-based Recruit,
who have and may continue to expand their geographic footprint;
differing and potentially lower levels of member growth and engagement in new and nascent geographies;
compliance with applicable foreign laws and regulations, which may change or conflict with each other, as well as potential risk
of penalties to individual members of management if our practices are deemed to be out of compliance;
longer payment cycles in some countries;
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credit risk and higher levels of payment fraud;

compliance with anti-bribery laws including, without limitation, compliance with the Foreign Corrupt Practices Act and the UK
Anti-Bribery Act;
implementing and maintaining effective internal processes and
controls;
compliance with various economic and trade sanctions regulations which restrict certain conduct of business;
currency exchange rate fluctuations;
foreign exchange controls that might prevent us from repatriating cash earned outside the United States;
foreign exchange controls that might require significant lead time in setting up operations and bank accounts before monetizing
our operations in certain geographic territories;
political and economic instability in some countries, specifically in
Ireland;
modifications we make to our site in certain jurisdictions due to local laws and regulations;
double taxation of our non-U.S. earnings and potentially adverse tax consequences due to changes in the tax laws of the United
States or the foreign jurisdictions in which we operate; and
higher costs of doing business internationally.

If our revenue from our international operations, and particularly from our operations in the countries and regions on which we have
focused our spending, do not exceed the expense of establishing and maintaining these operations, our business and operating results will
suffer. In addition, as our member base expands internationally, members in certain geographies may have lower levels of engagement with our
website and services. Finally, we have recently established a joint venture for the purpose of exploring the expansion of our operations in the
Peoples Republic of China, which is in the early stages. We will need to ensure that our business practices in China are compliant with local
laws and regulations, which will result in some modifications to the way our site, as well as our products and features, function in China as
compared to other countries in which we have local language sites. We will need to allocate significant resources to developing our presence in
China, and we may not be successful in doing so.
Our business depends on a strong and trusted brand, and any failure to maintain, protect and enhance our brand would hurt our ability to
retain or expand our base of members, enterprises and professional organizations, our ability to increase their level of engagement and our
ability to attract and retain high level employees.
We have developed a strong and trusted brand that we believe has contributed significantly to the success of our business. Our brand is
predicated on the idea that individual professionals will trust us and find immense value in building and maintaining their professional
identities and reputations on our platform. Maintaining, protecting and enhancing the LinkedIn brand is critical to expanding our base of
members, enterprises, advertisers, corporate customers and other partners, and increasing their engagement with our services, and will depend
largely on our ability to maintain member trust, be a technology leader and continue to provide high-quality solutions, which we may not do
successfully. Despite our efforts to protect our brand and prevent its misuse, if others misuse our brand or pass themselves off as being
endorsed or affiliated with us, it could harm our reputation and our business could suffer. If our members or potential members determine that
they can use other platforms, such as social networks, for the same purposes as or as a replacement for our network, or if they choose to blend
their professional and social networking activities, our brand and our business could be harmed. Our members or customers could find that new
products or features that we introduce are difficult to use or may feel that they degrade their experience on LinkedIn, which could harm our
reputation for delivering high-quality products. Our brand is also important in attracting and maintaining high performing employees. If we do
not successfully maintain a strong and trusted brand, our business could be harmed.
We may not be able to halt the operations of online services that aggregate our data as well as data from other companies, including social
networks, or copycat online services that have misappropriated our data in the past or may misappropriate our data in the future. These
activities could harm our brand and our business.
From time to time, third parties have accessed data from our networks through scraping, robots or other means and used this data or
aggregated this data on their online services with other data. In addition, copycat online services have misappropriated data on our network
and attempted to imitate our brand or the functionality of our services, and these services or others could use similar tactics to develop products
that compete with ours. These activities could degrade our brand, negatively impact our website performance and harm our business. When we
have become aware of such online services, in many instances we have employed contractual, technological or legal measures in an attempt to
halt unauthorized activities, but these measures may not be successful. In addition, if our customers do not comply with our terms of service,
they also may be able to abuse our products and services and provide access to our solutions to unauthorized users. However, we may not be
able to detect any or all of these types of activities in a timely manner and, even if we could, technological and legal measures may be
insufficient to stop their operations. In some cases, particularly in the case of online services operating from outside of the United States, our
available legal remedies may not be adequate to protect our business against such activities. Regardless of
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whether we can successfully enforce our rights against these parties, any measures that we may take could require us to expend significant
financial or other resources.
Failure to protect or enforce our intellectual property rights could harm our business and operating results.
We regard the protection of our trade secrets, copyrights, trademarks, trade dress, databases, domain names and patents as critical to our
success. We strive to protect our intellectual property rights by relying on federal, state and common law rights and other rights provided under
foreign laws, as well as through contractual restrictions. We have a practice of entering into confidentiality and invention assignment
agreements with our employees and contractors, and often enter into confidentiality agreements with parties with whom we conduct business in
order to limit access to, and disclosure and use of, our proprietary information. However, these contractual arrangements and the other steps we
have taken to protect our intellectual property may not prevent the misappropriation of our proprietary information, infringement of our
intellectual property rights or deter independent development of similar or competing technologies by others.
Obtaining and maintaining effective intellectual property rights is expensive, including the costs of defending our rights. We are seeking
to protect our trademarks and patents, and other intellectual property rights in a number of jurisdictions, a process that is expensive and may not
be successful in all jurisdictions for every such right or which we may not pursue in every location. In particular, we believe its important
maintain, protect and enhance the LinkedIn brand. Accordingly, we pursue the registration of domain names and our trademarks and service
marks in the United States and in certain locations outside the United States. We have already and may, over time, increase our investment in
protecting innovations through investments in patents and similar rights that is expensive and time-consuming.
Litigation may be necessary to enforce our intellectual property rights, protect our proprietary rights or determine the validity and scope
of proprietary rights claimed by others. Any litigation of this nature, regardless of outcome or merit, could result in substantial costs and
diversion of management and technical resources, any of which could adversely affect our business and operating results. We may incur
significant costs in enforcing our trademarks against those who attempt to imitate our LinkedIn brand and other valuable trademarks and
service marks.
In addition, we have chosen to make certain of our technology available under open source licenses that allow others to use the
technology without payment to us. While we hope to benefit from these activities by having access to others useful technology under open
source licenses, there is no assurance that we will receive the business benefits we expect.
If we fail to maintain, protect and enhance our intellectual property rights, our business and operating results may be harmed, and the
market price of our Class A common stock could decline.
We are, and expect in the future to be, subject to legal proceedings and litigation, including intellectual property and privacy disputes,
which are costly to defend and could materially harm our business and operating results.
We are party to lawsuits and legal proceedings in the normal course of business. These matters are often expensive and disruptive to
normal business operations. We are currently facing, or may face in the future, allegations, lawsuits and regulatory inquiries, audits and
investigations regarding data privacy, security and intellectual property infringement, including claims related to privacy, patents, publicity,
trademarks, copyrights and other rights. Litigation and regulatory proceedings, and particularly the patent infringement and class action matters
we are facing or may face, may be protracted and expensive, and the results are difficult to predict. Certain of these matters include speculative
claims for substantial or indeterminate amounts of damages, and include claims for injunctive relief. Additionally, our litigation costs are
significant. Adverse outcomes with respect to litigation or any of these legal proceedings may result in significant settlement costs or
judgments, penalties and fines, or require us to modify our products and features or require us to stop offering certain features, all of which
could negatively impact our membership and revenue growth. Additionally, we are subject to mandatory periodic audits, which would likely
increase our regulatory compliance costs, and may require us to change our business practices, which could negatively impact our revenue
growth. Managing legal proceedings, litigation and audits, even if we achieve favorable outcomes, is time-consuming and diverts
managements attention from our business.
In addition, we use open source software in our solutions and plan to continue to use open source software in the future. We may face
claims from others claiming ownership of open source software, or breach of open source license terms, including a demand for release of
material portions of our source code or otherwise seeking to enforce the terms of the applicable open source license. These claims could also
result in litigation, require us to purchase a costly license, require us to establish specific open source compliance procedures, or require us to
devote additional research and development resources to change our solutions, any of which would have a negative effect on our business and
operating results.
The results of regulatory proceedings, litigation, claims and audits cannot be predicted with certainty, and determining reserves for
pending litigation and other legal, regulatory and audit matters requires significant judgment. There can be no
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assurance that our expectations will prove correct, and even if these matters are not resolved in our favor or without significant cash
settlements, these matters, and the time and resources necessary to litigate or, resolve them, could harm our business, our operating results, our
reputation or the market price of our Class A common stock.
If we do not continue to attract new customers, or if existing customers do not renew their subscriptions, renew on less favorable terms, or
fail to purchase additional solutions, we may not achieve our revenue projections, and our operating results would be harmed.
In order to grow our business, we must continually attract new customers, sell additional solutions to existing customers and reduce the
level of non-renewals in our business. Our ability to do so depends in large part on the success of our sales and marketing efforts. We do not
typically enter into long-term contracts with our customers, and even when we do, they can generally terminate their relationship with us. We
have limited historical data with respect to rates of customer renewals, upgrades and expansions, so we may not accurately predict future trends
for any of these metrics. Furthermore, the nature of our products and solutions is such that customers may decide to terminate or not renew
their agreements with us without causing significant disruptions to their own businesses.
We must demonstrate that our Talent Solutions are an important recruiting tool for enterprises and professional organizations and that our
Marketing Solutions provide them with access to an audience of one of the most influential, affluent and highly educated audiences on the
Internet. However, potential customers may not be familiar with our solutions or may prefer other more traditional products and services for
their talent, advertising and marketing needs.
The rate at which we expand our customer base or increase our customers renewal rates may decline or fluctuate because of several
factors, including the prices of our solutions, the prices of products and services offered by our competitors, reduced hiring by our customers or
reductions in their talent or marketing spending levels due to macroeconomic or other factors and the efficacy and cost-effectiveness of our
solutions. If we do not attract new customers or if our customers do not renew their agreements for our solutions, renew on less favorable
terms, or do not purchase additional functionality or offerings, our revenue may grow more slowly than expected or decline.
Ultimately, attracting new customers and retaining existing customers requires that we continue to provide high quality solutions that our
customers value. In particular, our Talent Solutions customers will discontinue their purchases of our solutions if we fail to effectively connect
them with the talent they seek, and our premium subscribers will discontinue their subscriptions if they do not find the networking and business
opportunities that they value. Similarly, customers of our Marketing Solutions will not continue to do business with us if their advertisements
do not reach their intended audiences. Therefore we must continue to demonstrate to our customers that using our Marketing Solutions is the
most effective and cost-efficient way to maximize their results. Even if our Marketing Solutions are providing value to our customers,
advertisers are sensitive to general economic downturns and reductions in consumer spending, among other events and trends, which generally
results in reduced advertising expenditures and could adversely affect sales of our Marketing Solutions. Finally, we are in the early stages of
developing our sales solutions products which may not be successful. If we fail to provide high quality solutions and convince customers of our
value proposition, we may not be able to retain existing customers or attract new customers, which would harm our business and operating
results.
Because we recognize most of the revenue from our Talent Solutions and our Premium Subscriptions over the term of the agreement, a
significant downturn in these businesses may not be immediately reflected in our operating results.
We recognize most of the revenue from sales of our Talent Solutions and Premium Subscriptions over the terms of the agreements, which
is typically 12 months. As a result, a significant portion of the revenue we report in each quarter is generated from agreements entered into
during previous quarters. Consequently, a decline in new or renewed agreements in any one quarter may not significantly impact our revenue in
that quarter but will negatively affect our revenue in future quarters. In addition, we may be unable to adjust our fixed costs in response to
reduced revenue. Accordingly, the effect of significant declines in the sales of these offerings may not be reflected in our short-term results of
operations.
We depend on world class talent to grow and operate our business, and if we are unable to hire, retain and motivate our personnel, we may
not be able to grow effectively.
Our future success will depend upon our continued ability to identify, hire, develop, motivate and retain world class talent. Our ability to
execute efficiently is dependent upon contributions from all of our employees, in particular our senior management team. Key institutional
knowledge remains with a small group of long-term employees whom we may not be able to retain. We may not be able to retain the services
of any of our long-term employees or other members of senior management in the future. We do not have employment agreements other than
offer letters with any key employee, and we do not maintain key person life insurance for any employee. In addition, from time to time, there
may be changes in our senior management
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team that may be disruptive to our business. If our senior management team, including any new hires that we may make, fails to work together
effectively and to execute our plans and strategies on a timely basis, our business could be harmed.
Our growth strategy also depends on our ability to expand and retain our organization with world class talent. Identifying, recruiting,
training and integrating qualified individuals will require significant time, expense and attention. In addition to hiring new employees, we must
continue to focus on retaining our best talent. Competition for these resources is intense, particularly in the San Francisco Bay Area, where our
headquarters is located. We may need to invest significant amounts of cash and equity for new employees and we may never realize returns on
these investments. If we are not able to effectively increase and retain our talent, our ability to achieve our strategic objectives will be adversely
impacted, and our business will be harmed.
We believe that our culture has the potential to be a key contributor to our success. From 2012 to 2013, we increased the size of our
workforce by more than 46% , and we expect to continue to hire aggressively as we expand. If we do not continue to develop our corporate
culture as we grow and evolve, including maintaining our culture of transparency with our employees, it could harm our ability to foster the
innovation, creativity and teamwork we believe we need to support our growth. In addition, we completed our initial public offering in May
2011. As a result, employees who have been with us for longer than three years have been able to and may continue to realize substantial
financial gains in connection with the sales of their shares from the exercise of their vested options, which could result in a loss of employees.
There will likely be disparities of wealth between those of our employees whom we hired prior to our initial public offering in May 2011 and
those who joined us after we became a public company, which could adversely impact relations among employees and our culture in general.
The effectiveness of our Marketing Solutions depends in part on our relationships with advertising serving technology companies.
We rely, in part, on advertising serving technology companies to deliver our Marketing Solutions product. Our agreements with these
companies may not be extended or renewed after their respective expirations, or we may not be able to extend or renew our agreements on
terms and conditions favorable to us. If these agreements are terminated, we may not be able to enter into agreements with alternative
companies on acceptable terms or on a timely basis or both, which could negatively impact revenue from our Marketing Solutions.
Enterprises or professional organizations, including governmental agencies, may restrict access to our services, which could lead to the loss
or slowing of growth in our member base or the level of member engagement.
Our solutions depend on the ability of our members to access the Internet and our services. Enterprises or professional organizations,
including governmental agencies, could block or restrict access to our online services, website or the Internet generally for a number of reasons
such as security or confidentiality concerns or regulatory reasons, or they may adopt policies that prohibit listing the employers names on the
employees LinkedIn profiles in order to minimize the risk that employees will be contacted and hired by other employers.
In some cases, certain governments may seek to restrict the Internet or our service providers websites, services and solutions and the
performance of our websites, services and solutions could be suspended, blocked (in whole or part) or otherwise adversely impacted in these
jurisdictions. For example, the government of the Peoples Republic of China has blocked access to many social networking and other sites,
including ours, and certain self-regulatory organizations have policies that could result in access to our content, services or features being
blocked. Any restrictions on the use of our services by our members and users could lead to the loss or slowing of growth in our member base
or the level of member engagement.
If Internet search engines methodologies are modified or our search result page rankings decline for other reasons, our member
engagement could decline.
We depend in part on various Internet search engines, such as Google, Bing and Yahoo!, to direct a significant amount of traffic to our
website. Similarly, we depend on providers of mobile application store fronts to allow users to locate and download our mobile applications
that enable our service. Our ability to maintain the number of visitors directed to our website and users of our online services is not entirely
within our control. Our competitors search engine optimization, or SEO, efforts may result in their websites receiving a higher search result
page ranking than ours, or Internet search engines could revise their methodologies in an attempt to improve their search results, which could
adversely affect the placement of our search result page ranking. If search engine companies modify their search algorithms in ways that are
detrimental to our new user growth or in ways that make it harder for our members to use our website, or if our competitors SEO efforts are
more successful than ours, overall growth in our member base could slow, member engagement could decrease, and we could lose existing
members. These modifications may be prompted by search engine companies entering the online professional networking market or aligning
with competitors. Our website has experienced fluctuations in search result rankings in the past, and we anticipate
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similar fluctuations in the future. Any reduction in the number of users directed to our websites would harm our business and operating results.
Our business depends on continued and unimpeded access to the Internet by us and our members on personal computers and mobile
devices. If government regulations relating to the Internet or other areas of our business change, if Internet access providers are able to
block, degrade, or charge for access to certain of our products and services, or if third parties disrupt access to the Internet, we could incur
additional expenses and the loss of members and customers.
Our products and services depend on the ability of our members and customers to access the Internet through their personal computers
and mobile devices. Currently, this access is provided by companies that have significant market power in the broadband and Internet access
marketplace, including incumbent telephone companies, cable companies, mobile communications companies, and government-owned service
providers, any of whom could take actions that degrade, disrupt, or increase the cost of user access to our products or solutions, which would,
in turn, negatively impact our business. In addition, Internet access could be disrupted by other third parties. Further, the adoption of any laws
or regulations that adversely affect the growth, popularity or use of the Internet, including laws limiting Internet neutrality, could decrease the
demand for our subscription service or the usage of our services and increase our cost of doing business.
Our growth depends in part on the success of our strategic relationships with third parties.
We anticipate that we will continue to depend on relationships with various third parties, including technology and content providers to
grow our business. Identifying, negotiating and maintaining relationships with third parties requires significant time and resources, as does
integrating third-party content and technology. Our agreements with technology and content providers and similar third parties are typically
non-exclusive and do not prohibit them from working with our competitors or from offering competing services. In some cases, in particular,
with respect to content providers, these relationships are undocumented, or, if there are agreements in place, they may be easily terminable. Our
competitors may be effective in providing incentives to these parties to favor their solutions or may prevent us from developing strategic
relationships with these parties. In addition, these third parties may not perform as expected under our agreements with them, and we have had,
and may in the future have, disagreements or disputes with these parties, which could negatively affect our brand and reputation. It is possible
that these third parties may not be able to devote the resources we expect to the relationship or they may terminate their relationships with us.
Further, as users increasingly access our services through mobile devices, we are becoming more dependent on the distribution of our mobile
applications through third parties, and we may not be able to access their application program interfaces or be able to distribute our
applications, and this may also impact our ability to monetize our mobile products. If we are unsuccessful in establishing or maintaining our
relationships with third parties, our ability to compete in the marketplace or to grow our business could be impaired, and our operating results
would suffer. Even if we are successful, these relationships may not result in improved operating results.
If currency exchange rates fluctuate substantially in the future, the results of our operations, which are reported in U.S. dollars, could be
adversely affected.
As we continue to expand our international operations, we become more exposed to the effects of fluctuations in currency exchange rates.
We incur expenses for employee compensation and other operating expenses at our non-U.S. locations in the local currency, and accept
payment from customers in currencies other than the U.S. dollar. Since we conduct business in currencies other than U.S. dollars but report our
financial results in U.S. dollars, we face exposure to fluctuations in currency exchange rates. Consequently, exchange rate fluctuations between
the U.S. dollar and other currencies could have a material impact on our profitability. Although we hedge a portion of our international
currency exposure, significant fluctuations in exchange rates between the U.S. dollar and foreign currencies may adversely affect our net
income (loss). Additionally, hedging programs rely on our ability to forecast accurately and could expose us to additional risks that could
adversely affect our financial condition and results of operations.
The intended tax efficiency of our corporate structure and intercompany arrangements depend on the application of the tax laws of various
jurisdictions and on how we operate our business, and changes to our effective tax rate could adversely impact our results.
Our corporate structure and intercompany arrangements, including the manner in which we develop and use our intellectual property and
the transfer pricing of our intercompany transactions, are intended to optimize business efficiency as well as reduce our worldwide effective tax
rate. The application of the tax laws of various jurisdictions, including the United States and the other jurisdictions in which we operate, to our
international business activities is subject to interpretation and depends on our ability to operate our business in a manner consistent with our
corporate structure and intercompany arrangements. The taxing authorities of the jurisdictions in which we operate may challenge our
methodologies for valuing developed technology or for transfer pricing on intercompany arrangements. In particular, our non-U.S. headquarters
is located
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in Dublin, Ireland, but tax authorities in other jurisdictions where we operate may make a determination that the manner in which we operate
results in our business not achieving the intended tax consequences. This could increase our worldwide effective tax rate and harm our financial
position and results of operations. Our effective tax rate could be adversely affected by several other factors, many of which are outside of our
control, such as: increases in expenses that are not deductible for tax purposes, the tax effects of restructuring charges or purchase accounting
for acquisitions, changes related to our ability to ultimately realize future benefits attributed to our deferred tax assets, including those related to
other-than-temporary impairment, and a change in our decision to indefinitely reinvest foreign earnings. Further, we are currently undergoing
review and audit by both domestic and foreign tax authorities and expect such actions to continue in the future. Any adverse outcome of such a
review or audit could have a negative effect on our operating results and financial condition.
The enactment of legislation implementing changes in the U.S. taxation of international business activities, the adoption of other tax
reform policies or changes in tax legislation or policies in jurisdictions outside the United States could materially impact our financial
position and results of operations.
Members of the U.S. House of Representatives and the U.S. Senate have released draft proposals to reform the U.S. system for taxing
cross-border income. Possible future changes to U.S. tax laws, including limitations on the ability of taxpayers to claim and utilize foreign tax
credits and the deferral of certain tax deductions until earnings outside of the United States are repatriated to the United States, as well as
changes to U.S. tax laws that may be enacted in the future, could impact the tax treatment of our foreign earnings and adversely impact our
effective tax rate. Additionally, the Organisation for Economic Co-Operation and Development (OECD) is focused on developing resolutions
in various areas, including addressing the tax challenges of the digital economy and definitional changes to permanent establishment, which
could ultimately impact the tax treatment of our foreign earnings and adversely impact our effective tax rate. Due to the large and expanding
scale of our international business activities, any changes in the U.S. or international taxation of such activities may increase our worldwide
effective tax rate and harm our financial position and results of operations.
We may require additional capital to support business growth, and this capital might not be available on acceptable terms, if at all.
We intend to continue to make investments to support our business growth and may require additional funds to respond to business
challenges, including the need to develop new features and products or enhance our existing solutions, improve our operating infrastructure or
acquire complementary businesses and technologies. Accordingly, we may engage in equity or debt financings to secure additional funds. If we
raise additional funds through future issuances of equity or convertible debt securities, our existing stockholders could suffer significant
dilution, and any new equity securities we issue could have rights, preferences and privileges superior to those of holders of our Class A
common stock. Any debt financing we secure in the future could involve restrictive covenants relating to our capital raising activities and other
financial and operational matters, which may make it more difficult for us to obtain additional capital and to pursue business opportunities,
including potential acquisitions. We may not be able to obtain additional financing on terms favorable to us, if at all. If we are unable to obtain
adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to support our business growth and to
respond to business challenges could be significantly impaired, and our business may be harmed.
Acquisitions and investments could result in operating difficulties, dilution, and other harmful consequences that may adversely impact our
business and results of operations.
We have made and will continue to make acquisitions to add employees, complementary companies, products, or technologies. These
transactions could be material to our financial condition and results of operations. We also expect to continue to evaluate and enter into
discussions regarding a wide array of potential strategic transactions. The process of integrating an acquired company, business, or technology
has created, and will continue to create, unforeseen operating difficulties and expenditures. The areas where we face risks include:

loss of key employees of the acquired company and other challenges associated with integrating new employees into our culture;
diversion of management time and focus from operating our business to acquisition integration challenges;
implementation or remediation of controls, procedures, and policies at
the acquired company;
integration of the acquired companys accounting, human resource, and other administrative systems, and coordination of
product, engineering, and sales and marketing function;
assumption of contractual obligations that contain terms that are not beneficial to us, require us to license or waive intellectual
property rights or increase our risk for liability;
failure to successfully further develop the acquired technology; and
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liability for activities of the acquired company before the acquisition, including patent and trademark infringement claims,
violations of laws, commercial disputes, tax liabilities, and other known and unknown liabilities.

These risks or other problems encountered in connection with our acquisitions and investments could cause us to fail to realize the
anticipated benefits of such acquisitions or investments, incur unanticipated liabilities, and adversely affect our business generally.
Future acquisitions could also result in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities, or
amortization expenses, or write-offs of goodwill, any of which could harm our financial condition.
Risks Related to Our Class A Common Stock
The dual class structure of our common stock as contained in our charter documents has the effect of concentrating voting control with
those stockholders who held our stock prior to our initial public offering, including our founders and our executive officers, employees and
directors and their affiliates, and limiting our other stockholders ability to influence corporate matters.
Our Class B common stock has 10 votes per share, and our Class A common stock has one vote per share. Stockholders who hold shares
of Class B common stock, including our founders, and our executive officers, employees and directors and their affiliates, together held
approximately 62.4% of the voting power of our outstanding capital stock as of December 31, 2013. Our co-founder and Chair, Reid Hoffman,
held approximately 13.0% of our outstanding shares of Class A and Class B common stock, representing approximately 57.0% of the voting
power of our outstanding capital stock as of December 31, 2013. Mr. Hoffman has significant influence over the management and affairs of the
company and over all matters requiring stockholder approval, including election of directors and significant corporate transactions, such as a
merger or other sale of our company or its assets. Mr. Hoffman will continue to have significant influence over these matters for the foreseeable
future.
In addition, the holders of Class B common stock collectively will continue to be able to control all matters submitted to our stockholders
for approval even if their stock holdings represent less than 50% of the outstanding shares of our common stock. Because of the 10-to-1 voting
ratio between our Class B and Class A common stock, the holders of our Class B common stock collectively will continue to control a majority
of the combined voting power of our common stock even when the shares of Class B common stock represent as little as 10% of the combined
voting power of all outstanding shares of our Class A and Class B common stock. This concentrated control will limit the ability of our Class A
stockholders to influence corporate matters for the foreseeable future, and, as a result, the market price of our Class A common stock could be
adversely affected.
Future transfers by holders of Class B common stock will generally result in those shares converting to Class A common stock, which
will have the effect, over time, of increasing the relative voting power of those holders of Class B common stock who retain their shares in the
long term. If, for example, Mr. Hoffman retains a significant portion of his holdings of Class B common stock for an extended period of time,
he could, in the future, continue to control a majority of the combined voting power of our Class A and Class B common stock. As a board
member, Mr. Hoffman owes a fiduciary duty to our stockholders and must act in good faith in a manner he reasonably believes to be in the best
interests of our stockholders. As a stockholder, even a controlling stockholder, Mr. Hoffman is entitled to vote his shares in his own interests,
which may not always be in the interests of our stockholders generally.
Our stock price has been volatile in the past and may be subject to volatility in the future.
The trading price of our Class A common stock has been volatile historically, and could be subject to wide fluctuations in response to
various factors, some of which are beyond our control. During fiscal year 2013, the closing price of our Class A common stock ranged from
$109.80 to $257.56. Fluctuations in the valuation of companies perceived by investors to be comparable to us or in valuation metrics, such as
our price to earnings ratio, could impact our stock price. Additionally, the stock markets have at times experienced extreme price and volume
fluctuations that have affected and might in the future affect the market prices of equity securities of many companies. These fluctuations have,
in some cases, been unrelated or disproportionate to the operating performance of these companies. Further, the trading prices of publicly
traded shares of companies in our industry have been particularly volatile and may be very volatile in the future. These broad market and
industry fluctuations, as well as general economic, political and market conditions such as recessions, interest rate changes, international
currency fluctuations or political unrest, may negatively impact the market price of our Class A common stock. In the past, companies that have
experienced volatility in the market price of their stock have been subject to securities class action litigation. We may be the target of this type
of litigation in the future. Securities litigation against us could result in substantial costs and divert our managements attention from other
business concerns, which could harm our business.

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There may be a limited market for investors in our industry.

There are few publicly traded companies in the social and professional networking and related industries at this time, and we were among
the first social networking companies to go public. Investors may have limited funds to invest in the social and professional networking sector,
and as publicly traded securities in these industries become more available, investors who have purchased or may in the future purchase
securities in this sector may choose to sell LinkedIn securities that they have already purchased in favor of other companies, and/or choose to
invest in other companies, including our competitors. As a result, demand for our Class A common stock could decline, which would result in a
corresponding decline in our stock price.
Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult, limit attempts
by our stockholders to replace or remove our current management and limit the market price of our Class A common stock.
Provisions in our amended and restated certificate of incorporation and amended and restated bylaws, may have the effect of delaying or
preventing a change of control or changes in our management. Our certificate of incorporation and bylaws include provisions that:

authorize our board of directors to issue, without further action by the stockholders, up to 100,000,000 shares of undesignated
preferred stock;
require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written
consent;
specify that special meetings of our stockholders can be called only by our board of directors, the Chair of our board of directors,
or our Chief Executive Officer;
establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed
nominations of persons for election to our board of directors;
establish that our board of directors is divided into three classes, Class I, Class II and Class III, with each class serving three-year
staggered terms;
prohibit cumulative voting in the election of directors;
provide that our directors may be removed only for cause;
provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than
a quorum;
require the approval of our board of directors or the holders of a supermajority of our outstanding shares of capital stock to
amend our bylaws and certain provisions of our certificate of incorporation; and
reflect two classes of common stock, as discussed above.

These provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current management by making it
more difficult for stockholders to replace members of our board of directors, which is responsible for appointing the members of our
management. In addition, institutional shareholder representative groups, shareholder activists and others may disagree with our corporate
governance provisions or other practices, including our dual class structure and the other anti-takeover provisions, such as those listed above.
We generally will consider recommendations of institutional shareholder representative groups, but we will make decisions based on what our
board and management believe to be in the best long term interests of our company and stockholders. Our dual class structure concentrates the
voting power of our stock in a small group of stockholders who would have the ability to control the outcome of a stockholder vote.
Additionally, these groups could make recommendations to our stockholders against our practices or our board members if they disagree with
our positions. Finally, because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General
Corporation Law, which generally prohibits a Delaware corporation from engaging in any of a broad range of business combinations with any
interested stockholder for a period of three years following the date on which the stockholder became an interested stockholder.
If securities or industry analysts publish reports that are interpreted negatively by the investment community or publish negative research
reports about our business, our share price and trading volume could decline.
The trading market for our Class A common stock depends, to some extent, on the research and reports that securities or industry analysts
publish about us or our business. We do not have any control over these analysts. If one or more analysts publish research reports that are
interpreted negatively by the investment community, or have a negative tone regarding our business, industry or end-markets, our share price
could decline. If one or more of these analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility
in the financial markets, which could cause our share price or trading volume to decline.
The requirements of being a public company may strain our resources, divert managements attention and affect our ability to attract and
retain qualified board members.
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We are subject to the reporting requirements of the Securities Exchange Act of 1934, as amended, or the Exchange Act, the SarbanesOxley Act, the Dodd-Frank Act, the listing requirements of the NYSE and other applicable securities rules and regulations. Compliance with
these rules and regulations has increased and will continue to increase our legal and financial compliance costs, make some activities more
difficult, time-consuming or costly, and increase demand on our systems and resources.
We have and will continue to consume management resources and incur significant expenses for Section 404 compliance on an ongoing
basis. In the event that our chief executive officer, chief financial officer, or independent registered public accounting firm determines in the
future that our internal control over financial reporting is not effective as defined under Section 404, we could be subject to one or more
investigations or enforcement actions by state or federal regulatory agencies, stockholder lawsuits or other adverse actions requiring us to incur
defense costs, pay fines, settlements or judgments and causing investor perceptions to be adversely affected and potentially resulting in a
decline in the market price of our stock.
In addition, changing laws, regulations and standards relating to corporate governance and public disclosure are creating uncertainty for
public companies, increasing legal and financial compliance costs and making some activities more time consuming. These laws, regulations
and standards are subject to varying interpretations, in many cases due to their lack of specificity, and, as a result, their application in practice
may evolve over time as new guidance is provided by regulatory and governing bodies. This could result in continuing uncertainty regarding
compliance matters and higher costs necessitated by ongoing revisions to disclosure and governance practices. We intend to invest resources to
comply with evolving laws, regulations and standards, and this investment may result in increased general and administrative expenses and a
diversion of managements time and attention from revenue-generating activities to compliance activities. If our efforts to comply with new
laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to practice,
regulatory authorities may initiate legal proceedings against us and our business may be harmed.
As a public company that is subject to these rules and regulations, we may find that it is more expensive for us to obtain director and
officer liability insurance, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage. These
factors could also make it more difficult for us to attract and retain qualified members of our board of directors and qualified executive officers.
We do not intend to pay dividends for the foreseeable future.
We have never declared or paid any cash dividends on our common stock and do not intend to pay any cash dividends in the foreseeable
future. We anticipate that we will retain all of our future earnings for use in the development of our business and for general corporate
purposes. Any determination to pay dividends in the future will be at the discretion of our board of directors. Accordingly, investors must rely
on sales of their Class A common stock after price appreciation, which may never occur, as the only way to realize any future gains on their
investments.
Item 1B.

Unresolved Staff Comments

None.
Item 2.

Properties

As of December 31, 2013 , we lease approximately 373,000 square feet of space in our headquarters in Mountain View, California with
the lease term expiring in 2023. In addition, we lease approximately 587,000 additional square feet in Sunnyvale, California, currently under
construction by our landlord. The lease term is 12 years from the estimated date of delivery of the newly constructed buildings, and is currently
estimated to expire in 2026. We also lease additional offices in Chicago, New York, Omaha, San Francisco, Santa Monica, Sunnyvale, and
Washington D.C. We lease our international headquarters office in Dublin, Ireland, and lease additional offices in Australia, Brazil, Canada,
France, Germany, Hong Kong, India, Italy, Japan, the Netherlands, Singapore, Spain, Sweden, the United Arab Emirates and the United
Kingdom. We also operate data centers in the United States pursuant to various lease agreements.
We believe that our current facilities are adequate to meet our current needs. We intend to expand our facilities or add new facilities as we
add employees and enter new geographic markets, and we believe that suitable additional or alternative space will be available as needed to
accommodate ongoing operations and any such growth. However, we expect to incur additional expenses in connection with such new or
expanded facilities.

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Item 3.

Legal Proceedings

We are subject to legal proceedings and litigation arising in the ordinary course of business, including, but not limited to, certain pending
patent and privacy matters, including class action lawsuits, as well as inquiries, investigations, audits and other regulatory proceedings.
Although occasional adverse decisions or settlements may occur, we do not believe that the final disposition of any of these matters will have a
material adverse effect on our business. Certain of these matters include speculative claims for substantial or indeterminate amounts of
damages, and include claims for injunctive relief. Additionally, our litigation costs are significant. Other regulatory matters could result in fines
and penalties being assessed against us, and we may become subject to mandatory periodic audits, which would likely increase our regulatory
compliance costs. Adverse results of litigation or regulatory matters could also result in us being required to change our business practices,
which could negatively impact our membership and revenue growth.
We record a liability when we believe that it is both probable that a loss has been incurred and the amount can be reasonably estimated.
Periodically, we evaluate developments in our legal matters that could affect the amount of liability that has been previously accrued, if any,
and make adjustments as appropriate. Significant judgment is required to determine both likelihood of there being, and the estimated amount
of, a loss related to such matters, and our judgment may be incorrect. The outcome of any proceeding is not determinable in advance. Until the
final resolution of any such matters that we may be required to accrue for, we may be exposed to loss in excess of the amount accrued, and such
amounts could be material.
Item 4.

Mine Safety Disclosures

Not applicable.
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PART II
Item 5.

Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Our Class A common stock has been listed on the New York Stock Exchange (NYSE) under the symbol LNKD since May 19, 2011.
Prior to that date, there was no public trading market for our Class A common stock. There is no public trading market for our Class B common
stock. The following table sets forth for the periods indicated the high and low sales price per share of our Class A common stock as reported
on the NYSE for the periods indicated:
2013

2012

High

First Quarter
Second Quarter
Third Quarter
Fourth Quarter

184.15
202.91
257.56
254.20

Low

109.80
160.20
177.26
207.33

High

106.97
120.63
125.50
123.51

Low

61.28
88.00
91.67
94.75

On December 31, 2013 , the last reported sale price of our Class A common stock on the NYSE was $216.83 per share. As of December
31, 2013 , we had 108 holders of record of our Class A common stock and 54 holders of record of our Class B common stock. The actual
number of stockholders is greater than this number of record holders, and includes stockholders who are beneficial owners, but whose shares
are held in street name by brokers and other nominees. This number of holders of record also does not include stockholders whose shares may
be held in trust by other entities.
We have never declared or paid, and do not anticipate declaring or paying, any cash dividends on our capital stock. Any future
determination as to the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then
existing conditions, including our financial condition, operating results, contractual restrictions, capital requirements, business prospects and
other factors our board of directors may deem relevant.
Performance Graph
This performance graph shall not be deemed soliciting material or to be filed with the Securities and Exchange Commission for
purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or the Exchange Act, or otherwise subject to the liabilities under
that Section, and shall not be deemed to be incorporated by reference into any filing of LinkedIn Corporation under the Securities Act of 1933,
as amended, or the Exchange Act.
We have updated the industry indices to which our stocks performance is compared from the SNL Kagan New Media Index and S&P
500 Index, which were in last years Form 10-K, to the NASDAQ Composite Index and RDG Internet Composite Index. Accordingly, the two
graphs presented below include both new and previous indices for comparability. We have updated the indices because we believe that the
companies included in the NASDAQ Composite Index and RDG Internet Composite Index are more accessible to stakeholders.
The following graph shows a comparison from May 19, 2011, (the date our common stock commenced trading on the NYSE) through
December 31, 2013 , of the cumulative total returns for our Class A common stock, the NASDAQ Composite Index and the RDG Internet
Composite Index. Such returns are based on historical results and are not intended to suggest future performance. Data for the NASDAQ
Composite Index and the RDG Internet Composite Index assume reinvestment of dividends.

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COMPARISON OF 32 MONTH CUMULATIVE TOTAL RETURN

Among LinkedIn Corporation, the NASDAQ Composite Index, and the RDG Internet Composite Index

Period Ending
Index

LinkedIn
Corporation
NASDAQ
Composite Index
RDG Internet
Composite Index

5/19/2011

6/30/2011

9/30/2011

12/31/2011

3/31/2012

6/30/2012

9/30/2012

12/31/2012

3/28/2013

6/28/2013

9/30/2013

12/31/2013

100.00

95.59

82.84

66.85

108.21

112.75

127.75

121.82

186.80

189.18

261.07

230.06

100.00

96.74

84.67

92.45

109.39

104.19

111.16

107.94

117.70

123.27

137.75

152.95

100.00

96.25

92.28

99.15

125.24

117.63

129.81

119.54

120.80

125.35

141.71

162.77

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Table of Contents

The following graph shows a comparison from May 19, 2011, (the date our common stock commenced trading on the NYSE) through
December 31, 2013 , of the cumulative total returns for our Class A common stock, the S&P 500 Index and the SNL Kagan New Media Index.
Such returns are based on historical results and are not intended to suggest future performance. Data for the S&P 500 Index and the SNL Kagan
New Media Index assume reinvestment of dividends.
COMPARISON OF 32 MONTH CUMULATIVE TOTAL RETURN
Among LinkedIn Corporation, the S&P 500 Index, and the SNL Kagan New Media Index
Period Ending
Index

LinkedIn
Corporation
NASDAQ
Composite Index
RDG Internet
Composite Index

5/19/2011

6/30/2011

9/30/2011

12/31/2011

3/31/2012

6/30/2012

9/30/2012

12/31/2012

3/28/2013

6/28/2013

9/30/2013

12/31/2013

100.00

95.59

82.84

66.85

108.21

112.75

127.75

121.82

186.80

189.18

261.07

230.06

100.00

98.73

85.04

95.08

107.05

104.11

110.72

110.30

122.00

125.55

132.13

146.02

100.00

100.19

102.17

107.83

138.25

134.04

148.06

132.17

131.00

136.57

154.60

183.02

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Issuer Purchases of Equity Securities

The following table provides information with respect to repurchases of unvested shares of our Class B common stock made pursuant
the 2003 Plan during the three months ended December 31, 2013 . No shares of our Class A common stock were repurchased during the period.

Period
October 1 - October 31, 2013
November 1 - November 30, 2013
December 1 - December 31, 2013
Total

Total Number of
Shares Purchased
(1)

42

42

Average Price
Paid Per Share
$
3.50

$
3.50

Total Number of
Shares Purchased
as Part of
Publicly
Announced Plans
or Programs

Maximum Number
of Shares That May
Yet Be Purchased
Under the Plans or
Programs

__________________
(1)
Under the 2003 Plan, participants may exercise options prior to vesting, subject to a right of a repurchase by us. All shares in the
above table were shares repurchased as a result of us exercising this right and not pursuant to a publicly announced plan or program.
Item 6.

Selected Financial Data

The following selected historical consolidated financial data below should be read in conjunction with Item 7, Managements
Discussion and Analysis of Financial Condition and Results of Operations, our consolidated financial statements, the related notes appearing
in Item 8 Financial Statements and Supplementary Data of this Annual Report on Form 10-K to fully understand factors that may affect the
comparability of the information presented below.
The consolidated statements of operations data for the years ended December 31, 2013 , 2012 and 2011 and the consolidated balance
sheet data as of December 31, 2013 and 2012 are derived from our audited consolidated financial statements appearing in Item 8 Financial
Statements and Supplementary Data of this Annual Report on Form 10-K. The consolidated statements of operations for the years ended
December 31, 2010 and 2009 and the consolidated balance sheet data as of December 31, 2011 , 2010 and 2009 are derived from audited
consolidated financial statements not included in this report. Our historical results are not necessarily indicative of the results to be expected in
the future.
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Table of Contents

Year Ended December 31,

2013

Consolidated Statements of Operations

Data:
Net revenue
Costs and expenses:
Cost of revenue (exclusive of
depreciation and amortization shown
separately below)
Sales and marketing
Product development
General and administrative
Depreciation and amortization
Total costs and expenses
Income (loss) from operations
Other income (expense), net
Income (loss) before income taxes
Provision for income taxes
Net income (loss)

2012

972,309

202,908
522,100
395,643
225,566
134,516
1,480,733
47,812
1,416
49,228
22,459
26,769

Net income (loss) attributable to common

stockholders

Net income (loss) per share attributable to

common stockholders:
Basic
Diluted

1,528,545

2011
(in thousands, except per share data)

522,189

125,521
324,896
257,179
128,002
79,849
915,447
56,862
252
57,114
35,504
21,610

26,769

0.24

0.23

Weighted-average shares used to compute net

income (loss) per share attributable to
common stockholders:
Basic
Diluted
Other Financial and Operational Data:
Adjusted EBITDA (1)
$
Number of registered members (at period end)

2010

2009

243,099

120,127

81,448
164,703
132,222
74,871
43,100
496,344
25,845
(2,903)
22,942
11,030
11,912

44,826
58,978
65,104
35,064
19,551
223,523
19,576
(610)
18,966
3,581
15,385

25,857
26,847
39,444
19,480
11,854
123,482
(3,355)
230
(3,125)
848
(3,973)

21,610

11,912

3,429

(3,973)

0.21

0.15

0.08

(0.10)

0.19

0.11

0.07

(0.10)

113,643

105,166

77,185

42,446

41,184

118,944

112,844

104,118

46,459

41,184

376,243
276,842

223,030
201,912

98,713
144,974

47,959
90,437

14,651
55,111

(1) We define adjusted EBITDA as net income (loss), plus: provision for income taxes; other (income) expense, net; depreciation and
amortization; and stock-based compensation. Please see Adjusted EBITDA below for more information and for a reconciliation of
adjusted EBITDA to net income (loss), the most directly comparable financial measure calculated and presented in accordance with
U.S. generally accepted accounting principles, or GAAP.
Stock-based compensation included in the statements of operations data above was as follows:
Year Ended December 31,
2013

Cost of revenue
Sales and marketing
Product development
General and administrative
Total stock-based compensation

15,600
36,187
98,861
43,267
193,915

2012

6,416
17,726
46,026
16,151
86,319

2011
(in thousands)

1,678
8,074
13,625
6,391
29,768

2010

439
1,225
3,248
3,920
8,832

2009

370
657
2,346
2,779
6,152

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As of December 31,
2013

Consolidated Balance Sheet Data:

Cash and cash equivalents
Marketable securities
Property and equipment, net
Working capital
Total assets
Redeemable noncontrolling interest
Redeemable convertible preferred stock
Convertible preferred stock
Total stockholders equity

803,089
1,526,212
361,741
2,113,479
3,352,793
5,000

2,629,394

2012

2011
(in thousands)

270,408
479,141
186,677
603,418
1,382,330

908,424

339,048
238,456
114,850
499,268
873,697

624,979

2010

92,951

56,743
66,734
238,188

87,981
15,846
36,249

2009

89,979

25,730
71,885
148,559

87,981
15,413
9,082

Adjusted EBITDA
To provide investors with additional information regarding our financial results, we have disclosed in the table below and within this
Annual Report on Form 10-K adjusted EBITDA, a non-GAAP financial measure. We have provided a reconciliation below of adjusted
EBITDA to net income (loss), the most directly comparable GAAP financial measure.
We have included adjusted EBITDA in this Annual Report on Form 10-K because it is a key measure used by our management and board
of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop
short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating adjusted EBITDA can provide a useful
measure for period-to-period comparisons of our core business. Additionally, adjusted EBITDA is a key financial measure used by the
compensation committee of our board of directors in connection with the payment of bonuses to our executive officers and employees.
Accordingly, we believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our
operating results in the same manner as our management and board of directors.
Our use of adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis
of our results as reported under GAAP. Some of these limitations are:
although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in
the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital
expenditure requirements;
adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

adjusted EBITDA does not consider the potentially dilutive impact of

equity-based compensation;
adjusted EBITDA does not reflect tax payments that may represent a reduction in cash available to us; and
other companies, including companies in our industry, may calculate adjusted EBITDA differently, which reduces its usefulness as a
comparative measure.
Because of these limitations, you should consider adjusted EBITDA alongside other financial performance measures, including various
cash flow metrics, net income (loss) and our other GAAP results. The following table presents a reconciliation of adjusted EBITDA for each of
the periods indicated:
Year Ended December 31,
2013

Reconciliation of Adjusted EBITDA:

Net income (loss)
Provision for income taxes
Other (income) expense, net
Depreciation and amortization
Stock-based compensation
Adjusted EBITDA

26,769
22,459
(1,416)
134,516
193,915
376,243

2012

2011
(in thousands)

21,610
35,504
(252)
79,849
86,319
223,030

- 38 -

11,912
11,030
2,903
43,100
29,768
98,713

2010

15,385
3,581
610
19,551
8,832
47,959

2009

(3,973)
848
(230)
11,854
6,152
14,651

Table of Contents

Item 7.

Managements Discussion and Analysis of Financial Condition and Results of Operations

This section and other parts of this Annual Report on Form 10-K contain forward-looking statements that involve risks and uncertainties.
Forward-looking statements can also be identified by words such as anticipates, expects, believes, plans, predicts, and similar
terms. Forward-looking statements are not guarantees of future performance and the Companys actual results may differ significantly from the
results discussed in the forward-looking statements. Factors that might cause such differences include, but are not limited to, those discussed in
the subsection entitled Risk Factors above, which are incorporated herein by reference.
You should read the following discussion in conjunction with the consolidated financial statements and notes thereto included in Item 8
Financial Statements and Supplementary Data of this Annual Report on Form 10-K. All information presented herein is based on the
Companys fiscal calendar. Unless otherwise stated, references in this report to particular years or quarters refer to the Companys fiscal years
ended in December and the associated quarters of those fiscal years. The Company assumes no obligation to revise or update any forwardlooking statements for any reason, except as required by law.
Overview
We are the worlds largest professional network on the Internet and currently have approximately 277 million members in over 200
countries and territories. Through our proprietary platform, members are able to create, manage and share their professional identity online,
build and engage with their professional network, access shared knowledge and insights, and find business opportunities, enabling them to be
more productive and successful. We believe we are the most extensive, accurate and accessible network focused on professionals.
In 2013 , we achieved significant growth from 2012 as our network of registered members and member engagement continues to increase
and we continue to benefit from expanded product offerings and international expansion. Our net revenue was $1,528.5 million in 2013 , which
represented an increase of 57% from 2012 . Our future growth will depend, in part, on our ability to continue to increase our member base and
member engagement on both desktop and mobile devices, as well as continuing to expand our product offerings and international expansion,
which we believe will result in increased sales of our Talent Solutions, Marketing Solutions and Premium Subscriptions to new and existing
customers. As our net revenue increases, we expect our growth rate related to net revenue will decrease over time. Also, we believe the rate at
which we are able to increase our member base and member engagement, as measured by our key metrics, will decelerate over time because of
the large scale of our network, and that this may impact portions of our business.
In September 2013, we closed a follow-on offering, at which time we sold a total of 6,188,340 shares of our Class A common stock. We
received total cash proceeds of $1,348.1 million , net of underwriting discounts and commissions and other costs associated with this offering.
We intend to use these proceeds for general corporate purposes and to support the growth of our business.
In 2014, our philosophy is to continue to invest for long-term growth and we expect to continue to invest heavily in the following:
Talent. We expect to increase our workforce, which will result in an increase in headcount-related expenses, including stock-based
compensation expense. As of December 31, 2013 , we had 5,045 employees, which represented an increase of 46% compared to the
same period last year.
Technology. We expect to continue to make significant capital expenditures to upgrade our technology and network infrastructure to
improve the ability of our website to handle expected increases in usage, to enable the release of new features and solutions, and to
scale for future growth.
Product. We expect to continue to invest heavily in our product development efforts to enable our members and customers to derive
more value from our platform.
Monetization. We expect to continue to aggressively expand our field sales organization to market our solutions both in the United
States and internationally.

As a result of our investment philosophy, we may not be profitable on a U.S. generally accepted accounting principles (GAAP) basis in
2014.

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Key Metrics
We regularly review a number of metrics, including the following key metrics, to evaluate our business, measure our performance,
identify trends affecting our business, formulate financial projections and make strategic decisions.
Number of Registered Members . We define the number of registered members in our network as the number of individual users who
have created a member profile on our website as of the date of measurement. We believe the number of registered members is a key
indicator of the growth of our network and our ability to receive the benefits of the network effects resulting from such growth.
Growth in our member base depends, in part, on our ability to successfully develop and market our solutions to professionals who
have not yet become members of our network. Member growth will also be contingent on our ability to translate our offerings into
additional languages, create more localized products in certain key markets, and more broadly expand our member base
internationally.
We believe that a higher number of registered members will result in increased sales of our Talent Solutions, Marketing Solutions and
Premium Subscriptions, as customers will have access to a larger pool of professional talent. However, a higher number of registered
members will not immediately increase sales, nor will a higher number of registered members in a given region immediately increase
sales in that region.
The following table presents the number of registered members as of the periods presented by geographic region:
December 31,
2013

Members by geographic region:

United States
Other Americas (1)
Total Americas
EMEA (2)
APAC (3)
Total number of registered members
(4)

December 31,
2012

% Change
2012
(in thousands, except percentages)

2011

% Change

94,115
47,646
141,761
85,656
49,425

73,633
32,746
106,379
60,020
35,513

28%
46%
33%
43%
39%

73,633
32,746
106,379
60,020
35,513

57,745
20,850
78,595
41,758
24,621

28%
57%
35%
44%
44%

276,842

201,912

37%

201,912

144,974

39%

______________________
(1)
Canada, Latin America and South America
(2)
Europe, the Middle East and Africa (EMEA)
(3)
Asia-Pacific (APAC)
(4)
The number of registered members is higher than the number of actual members due to various factors. For more information, see
Risk Factors The number of our registered members is higher than the number of actual members and a substantial majority of
our page views are generated by a minority of our members . Our business may be adversely impacted if we are unable to attract and
retain additional members who actively use our services. In addition, the tracking of certain of our performance metrics is done with
internal tools and is not independently verified.
The number of our registered members increased by 37% in 2013 compared to 2012 , and by 39% in 2012 compared to 2011 . Over these
same periods, the growth rate in our net revenue exceeded the growth rate of our number of registered members. While growth in the number
of registered members is an important indicator of expected revenue growth, it also informs our managements decisions with respect to those
areas of our business that will require further investment to support expected future membership growth. For example, as the number of
registered members increases, we will need to increase our capital expenditures to improve our information technology infrastructure to
maintain the effectiveness of our solutions and the performance of our website for our members.
Unique Visitors . We report our unique visitors based on data provided by comScore, a leading provider of digital marketing
intelligence. comScore defines unique visitors as users who have visited our desktop website (which excludes mobile engagement) at
least once during a month regardless of whether they are a member. We view unique visitors as a key indicator of growth in our brand
awareness among users and whether we are providing our members with useful products and features, thereby increasing member
engagement. We believe that a higher level of member engagement will result in increased sales of our Talent Solutions, Marketing
Solutions and Premium Subscriptions, as customers will have access to a larger pool of professional talent. Growth in unique visitors
will be driven by growth in the number of registered members, improvements to features and products that drive traffic to our website,
and international expansion.
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The following table presents the average monthly number of unique visitors during the periods presented:
December 31,
2013

December 31,
2012

% Change

2012

2011

% Change

(in millions, except percentages)

Unique visitors (1)

183
126
45%
126
84
50%
(1) Includes the impact of Slideshare, which was acquired on May 17, 2012, beginning on June 1, 2012. Excluding the impact of
Slideshare, the average monthly number of unique visitors for the year ended December 31, 2013 and December 31, 2012 was 139
million and 109 million , respectively.
The number of unique visitors increased by 45% in 2013 compared to 2012 , and by 50% in 2012 compared to 2011 . These increases
reflect increased traffic to our website by a growing number of users. While this increase in unique visitors helped to drive the increase in net
revenue that we experienced during this period, it also provided management with important insights into the ways in which our users and
members were using our website, including how they were coming to our website and which products and features best promoted brand
awareness to attract users to our website.
Page Views . We report our page views based on data provided by comScore. comScore defines page views as the number of pages on
our desktop website (excluding mobile page views) that users view during the measurement period. Similar to unique visitors, we
believe page views is a key indicator for gaining insight into whether we are increasing member engagement and whether our
members are deriving value from our solutions. We expect growth in page views will be driven, in part, by growth in the number of
registered members, improvements in products and features that drive member traffic to our website, and international expansion.
However, page views may not capture all of the value that our members and other users derive from our solutions because part of the
benefit of certain products and features is that the member or user does not need to visit our website to receive value from our
platform. For example, members can respond to emails they receive from other members without accessing their LinkedIn account or
our website.
The following table presents the number of page views during the periods presented:
December 31,
2013

December 31,
2012

% Change

2012

2011

% Change

(in millions, except percentages)

Page views (1)

47,336
38,258
24%
38,258
29,420
30%
(1) Includes the impact of Slideshare, which was acquired on May 17, 2012, beginning on June 1, 2012. Excluding the impact of
Slideshare, the number of page views for the year ended December 31, 2013 and December 31, 2012 was 45 billion and 37 billion ,
respectively.
The number of page views according to comScore increased 24% in 2013 compared to 2012 , and by 30% in 2012 compared to 2011 .
These increases reflect increased use of the information, products and features available on our website by our users. While similar to the
increase in registered members and unique visitors, this increase in page views also helped to drive the increase in net revenue that we
experienced during this period. The page views metric also provided management with important insights into the ways in which our users
were utilizing the information, products and features on our website, which informs managements decision on how to improve these products
and features to provide our users with compelling reasons for continuing to come back to our website.
Number of LinkedIn Corporate Solutions Customers. We define the number of LinkedIn Corporate Solutions customers as the
number of enterprises and professional organizations that we have under active contracts for this product as of the date of
measurement. Our LinkedIn Corporate Solutions include LinkedIn Recruiter, Job Slots, LinkedIn Recruitment Media and LinkedIn
Career Pages, which are all part of Talent Solutions. We believe the number of LinkedIn Corporate Solutions customers is a key
indicator of our market penetration in the online recruiting market, the productivity of our field sales organization and the value that
our products bring to both large and small enterprises and professional organizations. The number of customers subscribing to our
LinkedIn Corporate Solutions product is particularly important to monitor given that we expect revenue from LinkedIn Corporate
Solutions to continue to represent a significant portion of our total net revenue, and we are significantly investing in our ability to
successfully sell this unique product in a new and rapidly evolving market.
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The following table presents the number of LinkedIn Corporate Solutions customers as of the periods presented:
December 31,

LinkedIn Corporate Solutions customers

December 31,

2013

2012

24,444

16,409

% Change

49%

2012

2011

16,409

% Change

9,236

78%

The number of LinkedIn Corporate Solutions customers increased by 49% in 2013 compared to 2012 , and by 78% in 2012 compared to
2011 . During these periods, we experienced an increase in net revenue from sales of our Talent Solutions, both in terms of absolute net revenue
and as a percentage of our total net revenue (as further described in Results of Operations below), which was, and continues to be, largely
driven by increases in the number of our customers that have purchased our LinkedIn Corporate Solutions products.
Sales Channel Mix. Depending on the specific product, we sell our Talent Solutions and Marketing Solutions offline through our field
sales organization or online on our website. The vast majority of our Premium Subscriptions are sold through our website. Our field
sales organization uses a direct sales force to solicit customers and agencies. This offline channel is characterized by a longer sales
cycle where price can be negotiated, higher relative average selling prices, longer contract terms, higher selling expenses and a longer
cash collection cycle compared to our online channel.
Our online sales channel allows members to purchase solutions directly on our website. Members can purchase Premium
Subscriptions as well as certain lower priced products in our Talent Solutions and Marketing Solutions, such as job postings and self-service
advertising. This channel is characterized by lower average selling prices and higher cancellations compared to our offline channel, lower
selling costs due to our automated payments platform and a highly liquid collection cycle.
The following table presents our net revenue by field sales and online sales:
Year Ended December 31,
2013

2012

2011

($ in thousands)

Field sales
Online sales

$
$

891,458
637,087
1,528,545

58%
42%
100%

$
$

552,459
419,850
972,309

57%
43%
100%

$
$

287,634
234,555
522,189

55%
45%
100%

Adjusted EBITDA
To provide investors with additional information regarding our financial results, we have disclosed within this Annual Report on Form
10-K adjusted EBITDA, a non-GAAP financial measure. We have provided a reconciliation below of adjusted EBITDA to net income, the
most directly comparable GAAP financial measure.
We have included adjusted EBITDA in this Annual Report on Form 10-K because it is a key measure used by our management and board
of directors to understand and evaluate our core operating performance and trends, to prepare and approve our annual budget and to develop
short- and long-term operational plans. In particular, the exclusion of certain expenses in calculating adjusted EBITDA can provide a useful
measure for period-to-period comparisons of our core business. Additionally, adjusted EBITDA is a key financial measure used by the
compensation committee of our board of directors in connection with the payment of bonuses to our executive officers and employees.
Accordingly, we believe that adjusted EBITDA provides useful information to investors and others in understanding and evaluating our
operating results in the same manner as our management and board of directors.
For additional information on the limitations of adjusted EBITDA, see Adjusted EBITDA in Item 6 Selected Financial Data for more
information.
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Table of Contents

Year Ended December 31,

2013

2012

2011

(in thousands)

Reconciliation of Adjusted EBITDA:

Net income
Provision for income taxes
Other (income) expense, net
Depreciation and amortization
Stock-based compensation
Adjusted EBITDA

26,769
22,459
(1,416)
134,516
193,915
376,243

21,610
35,504
(252)
79,849
86,319
223,030

11,912
11,030
2,903
43,100
29,768
98,713

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared in accordance with GAAP. The preparation of these consolidated financial statements
requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, expenses and related disclosures.
We evaluate our estimates and assumptions on an ongoing basis. Our estimates are based on historical experience and various other
assumptions that we believe to be reasonable under the circumstances. Our actual results could differ from these estimates.
We believe that the assumptions and estimates associated with revenue recognition, stock-based compensation, the valuation of goodwill
and intangible assets, website and internal-use software development costs, leases, income taxes and legal contingencies have the greatest
potential impact on our consolidated financial statements. Therefore, we consider these to be our critical accounting policies and estimates. For
further information on all of our significant accounting policies, see Note 1 of the Notes to Consolidated Financial Statements under Item 8.
Revenue Recognition
A majority of our arrangements for Talent Solutions and Marketing Solutions include multiple deliverables. In accordance with
authoritative guidance on revenue recognition, we allocate consideration at the inception of an arrangement to all deliverables based on the
relative selling price method in accordance with the selling price hierarchy. The objective of the hierarchy is to determine the price at which we
would transact a sale if the service were sold on a stand-alone basis and requires the use of: (1) vendor-specific objective evidence, or VSOE, if
available; (2) third-party evidence, or TPE, if VSOE is not available; and (3) best estimate of selling price, or BESP, if neither VSOE nor TPE
is available.
VSOE. We determine VSOE based on our historical pricing and discounting practices for the specific solution when sold separately. In
determining VSOE, we require that a substantial majority of the selling prices for these services fall within a reasonably narrow pricing range.
We have not historically priced our Marketing Solutions within a narrow range to allow us to establish VSOE. We have established VSOE for a
limited number of our Talent Solutions products and for such products, VSOE has been used to allocate the selling price of deliverables.
TPE . When VSOE cannot be established for deliverables in multiple element arrangements, we apply judgment with respect to whether
we can establish selling price based on TPE. TPE is determined based on competitor prices for similar deliverables when sold separately.
Generally, our go-to-market strategy differs from that of our peers and our offerings contain a significant level of differentiation such that the
comparable pricing of services with similar functionality cannot be obtained. Furthermore, we are unable to reliably determine what similar
competitor services selling prices are on a stand-alone basis. As a result, we have not been able to establish selling price based on TPE.
BESP . When we are unable to establish selling price using VSOE or TPE, we use BESP in our allocation of arrangement consideration.
The process for determining our BESP for deliverables without VSOE or TPE involves management's judgment. Our process considers
multiple factors that may vary depending upon the unique facts and circumstances related to each deliverable. Key factors that we considered
in developing our BESPs include: (1) historical sales prices, (2) prices we charge for similar offerings, (3) sales volume, and (4) geographies.
Generally, we are not able to establish VSOE nor TPE for our Talent Solutions and Marketing Solutions deliverables. The allocation of revenue
has generally been based on our BESPs.
If the facts and circumstances underlying the factors we considered change or should future facts and circumstances lead us to consider
additional factors, both our determination of our relative selling price under the hierarchy and our BESPs could change in future periods.
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Stock-Based Compensation
We account for stock-based compensation in accordance with the authoritative guidance on stock compensation. Under the fair value
recognition provisions of this guidance, stock-based compensation is measured at the grant date based on the fair value of the award and is
recognized as expense, net of estimated forfeitures, over the requisite service period, which is generally the vesting period of the respective
award. As a result, we are required to estimate the amount of stock-based compensation we expect to be forfeited based on our historical
experience. If actual forfeitures differ significantly from our estimates, stock-based compensation expense and our results of operations could
be materially impacted.
Determining the fair value of stock-based awards at the grant date requires judgment. We use the Black-Scholes option-pricing model to
determine the fair value of stock options and employee stock purchase plan options. The determination of the grant date fair value of options
using an option-pricing model is affected by our estimated common stock fair value as well as assumptions regarding a number of other
complex and subjective variables. These variables include the fair value of our common stock, our expected stock price volatility over the
expected term of the options, stock option exercise and cancellation behaviors, risk-free interest rates, and expected dividends, which are
estimated as follows:
Fair Value of Our Common Stock . Because our stock was not publicly traded prior to our initial public offering, the fair value of our
common stock underlying our stock options was determined by our board of directors or compensation committee of our board of
directors, which intended all options granted to be exercisable at a price per share not less than the per share fair value of our common
stock underlying those options on the date of grant. Upon completion of our initial public offering on May 19, 2011, our Class A
common stock was valued by reference to its publicly traded price.

Expected Term . The expected term was estimated using the simplified
method allowed under SEC guidance.
Volatility. As we do not have a significant trading history for our common stock, the expected stock price volatility for our common
stock was estimated by taking the average historic price volatility for industry peers based on daily price observations over a period
equivalent to the expected term of the stock option grants. Industry peers consist of several public companies in the technology
industry similar in size, stage of life cycle and financial leverage. We did not rely on implied volatilities of traded options in our
industry peers common stock because the volume of activity was relatively low. We intend to continue to consistently apply this
process using the same or similar public companies until a sufficient amount of historical information regarding the volatility of our
own common stock share price becomes available, or unless circumstances change such that the identified companies are no longer
similar to us, in which case, more suitable companies whose share prices are publicly available would be utilized in the calculation.
Risk-Free Rate . The risk-free interest rate is based on the yields of U.S. Treasury securities with maturities similar to the expected
term of the options for each option group.
Dividend Yield. We have never declared or paid any cash dividends and do not presently plan to pay cash dividends in the foreseeable
future. Consequently, we used an expected dividend yield of zero.
Valuation of Goodwill and Intangible Assets
When we acquire businesses, we allocate the purchase price to the tangible assets and liabilities and identifiable intangible assets
acquired. Any residual purchase price is recorded as goodwill. The allocation of the purchase price requires management to make significant
estimates in determining the fair values of assets acquired and liabilities assumed, especially with respect to intangible assets. These estimates
are based on information obtained from management of the acquired companies and historical experience. These estimates can include, but are
not limited to:
the time and expenses that would be necessary to recreate the asset;

the profit margin a market participant would

receive;

cash flows that an asset is expected to generate in

the future; and

discount rates.
These estimates are inherently uncertain and unpredictable, and if different estimates were used the purchase price for the acquisition
could be allocated to the acquired assets and liabilities differently from the allocation that we have made. In addition, unanticipated events and
circumstances may occur which may affect the accuracy or validity of such estimates, and if such events occur we may be required to record a
charge against the value ascribed to an acquired asset or an increase in the amounts recorded for assumed liabilities.
Website and Internal-Use Software Development Costs
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We capitalize certain costs related to the development of our website or software developed for internal-use. In accordance with
authoritative guidance, we begin to capitalize our costs to develop software when preliminary development efforts are successfully completed,
management has authorized and committed project funding, and it is probable that the project will be completed and the software will be used
as intended. Such costs are amortized on a straight-line basis over the estimated useful life of the related asset, generally estimated to be two to
three years. Costs incurred prior to meeting these criteria together with costs incurred for training and maintenance are expensed as incurred
and recorded within product development expenses on our consolidated statements of operations. We exercise judgment in determining the
point at which various projects may be capitalized, in assessing the ongoing value of the capitalized costs and in determining the estimated
useful lives over which the costs are amortized. To the extent that we change the manner in which we develop and test new features and
functionalities related to our website, assess the ongoing value of capitalized assets or determine the estimated useful lives over which the costs
are amortized, the amount of website and internal-use software development costs we capitalize and amortize could change in future periods.
Leases
Historically, all of our significant leases have been accounted for as operating leases. Accounting for these leases requires significant
judgment by management. Application of accounting rules and assumptions made by management will determine whether the lease is
accounted for as a capital or operating lease or whether we are considered the owner for accounting purposes in accordance with authoritative
accounting guidance on leases.
If the lease is considered a capital lease or we are considered the owner for accounting purposes, we would record the property and a
related capital lease obligation on our balance sheet. The asset would then be depreciated over the expected lease term. Rent payments for these
properties would be allocated between interest expense and a reduction of the capital lease obligation.
If the lease is considered an operating lease, it is not recorded on our balance sheet and rent expense is recognized on a straight-line basis
over the expected lease term.
The most significant estimates used by management in accounting for property leases and the impact of these estimates are as follows:
Expected lease term. The expected lease term is used in determining whether the lease is accounted for as an operating lease or a
capital lease. A lease is considered a capital lease if the lease term is equal to or exceeds 75% of the leased assets estimated economic
life. The expected lease term is also used in determining the depreciable life of the asset or the straight-line rent recognition period.
Increasing the expected lease term will increase the probability that a lease will be considered a capital lease and will generally result
in higher rent expense for an operating lease and higher interest and depreciation expenses for a capital lease.
Incremental borrowing rate . We estimate our incremental borrowing rate using interest swap rates comparable to the expected
duration of the lease payments and our credit spread. The incremental borrowing rate is primarily used in determining whether the
lease is accounted for as an operating lease or a capital lease. A lease is considered a capital lease if the net present value of the lease
payments is equal to or greater than 90% of the fair market value of the property. Increasing the incremental borrowing rate decreases
the net present value of the lease payments and reduces the probability that a lease will be considered a capital lease.
Fair market value of leased asset . The fair market value of leased property is generally estimated based on comparable market data.
Fair market value is used in determining whether the lease is accounted for as an operating lease or a capital lease. A lease is
considered a capital lease if the net present value of the lease payments is equal to or greater than 90% of the fair market value of the
property. Increasing the fair market value reduces the probability that a lease will be considered a capital lease.

If our assumptions change and we amend an existing lease or enter into a new lease, we may have leases that are accounted for as capital
leases, as well as operating leases. Accounting for a lease as a capital lease would accelerate the timing of expense recognition due to the
recognition of larger amounts of interest expense near the beginning of the lease term. It would also change the characterization of expense
from rent expense to a combination of depreciation and interest expense, both of which are excluded from our adjusted EBITDA metric and
would likely impact other financial metrics. However, lease classification would not be expected to impact our cash flow.
Income Taxes
We record income taxes using the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the
expected future tax consequences of events that have been recognized in our financial statements or tax
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returns. In estimating future tax consequences, generally all expected future events other than enactments or changes in the tax law or rates are
considered. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized.
We recognize a tax benefit from an uncertain tax position only if it is more likely than not the tax position will be sustained on
examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from
such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. In the
event that any unrecognized tax benefits are recognized, the effective tax rate will be affected. If recognized, approximately $25.3 million of
unrecognized tax benefit would impact the effective tax rate at December 31, 2013. Although we believe our estimates are reasonable, no
assurance can be given that the final tax outcome of these matters will be the same as these estimates. These estimates are updated quarterly
based on factors such as change in facts or circumstances, changes in tax law, new audit activity, and effectively settled issues.
We follow specific and detailed guidelines in each tax jurisdiction regarding the recoverability of any tax assets recorded on the
balance sheet and provide necessary valuation allowances as required. Future realization of deferred tax assets ultimately depends on the
existence of sufficient taxable income of the appropriate character (for example, ordinary income or capital gain) within the carryback or
carryforward periods available under the tax law. We regularly review our deferred tax assets for recoverability based on historical taxable
income, projected future taxable income, the expected timing of the reversals of existing temporary differences and tax planning strategies. Our
judgments regarding future profitability may change due to many factors, including future market conditions and our ability to successfully
execute our business plans and/or tax planning strategies. Should there be a change in our ability to recover our deferred tax assets, our tax
provision would increase or decrease in the period in which the assessment is changed.
Legal Contingencies
We are subject to legal proceedings and litigation arising in the ordinary course of business. Periodically, we evaluate the status of each
legal matter and assess our potential financial exposure. If the potential loss from any legal proceeding or litigation is considered probable and
the amount can be reasonably estimated, we accrue a liability for the estimated loss. Significant judgment is required to determine the
probability of a loss and whether the amount of the loss is reasonably estimable. The outcome of any proceeding is not determinable in
advance. As a result, the assessment of a potential liability and the amount of accruals recorded are based only on the information available at
the time. As additional information becomes available, we reassess the potential liability related to the legal proceeding or litigation, and may
revise our estimates. Any revisions could have a material effect on our results of operations. See Note 10 of the Notes to the Consolidated
Financial Statements under Item 8 for further information on our legal proceedings and litigation.
Results of Operations
The following tables set forth our consolidated results of operations for the periods presented as a percentage of net revenue for those
periods. The period-to-period comparison of financial results is not necessarily indicative of future results.
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Year Ended December 31,

2013

2012

2011

(as a percentage of revenue)

Consolidated Statements of Operations Data: (1)

Net revenue
Costs and expenses:
Cost of revenue (exclusive of depreciation and amortization shown
separately below)
Sales and marketing
Product development
General and administrative
Depreciation and amortization
Total costs and expenses
Income from operations
Other income (expense), net
Income before income taxes
Provision for income taxes
Net income

100%

100%

100 %

13
34
26
15
9
97
3

3
1
2%

13
33
26
13
8
94
6

6
4
2%

16
32
25
14
8
95
5
(1)
4
2
2%

______________________
(1) Certain items may not total due to rounding.
Net Revenue
We generate revenue from Talent Solutions, Marketing Solutions and Premium Subscriptions.
Talent Solutions . Revenue from Talent Solutions is derived primarily from providing access to the LinkedIn Recruiter product and job
postings. We provide access to our professional database of both active and passive job candidates with LinkedIn Recruiter, which allows
corporate recruiting teams to identify candidates based on industry, job function, geography, experience/education, and other specifications.
Revenue from the LinkedIn Recruiter product is recognized ratably over the subscription period, which consists primarily of annual
subscriptions that are billed monthly, quarterly, or annually. We also earn revenue from the placement of job postings on our website, which
generally run for 30 days. Independent recruiters can pay to post job openings that are accessible through job searches or targeted job matches.
Revenue from job postings is recognized as the posting is displayed or the contract period, whichever is shorter.
Marketing Solutions . Revenue from Marketing Solutions is earned from the display of advertisements (both graphic and text link) on our
website primarily based on a cost per advertisement model. Revenue from Internet advertising is recognized as the online advertisements are
displayed on our website. The typical duration of our advertising contracts is approximately two months.
Premium Subscriptions . Revenue from Premium Subscriptions is derived from selling various subscriptions to customers that allow
users to have further access to premium services via our LinkedIn.com website. We offer our members monthly or annual subscriptions.
Revenue from Premium Subscriptions is recognized ratably over the contract period, which is generally one to 12 months.
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Year Ended
December 31,
2013

Year Ended
December 31,
2012

% Change

2012

2011

% Change

($ in thousands)

Revenue by product:
Talent Solutions
Marketing Solutions
Premium Subscriptions
Total
Percentage of revenue by
product: (1)
Talent Solutions
Marketing Solutions
Premium Subscriptions
Total

859,674
362,360
306,511
1,528,545

56%
24%
20%
100%

523,582
258,278
190,449
972,309

64%
40%
61%
57%

54%
27%
20%
100%

523,582
258,278
190,449
972,309

54%
27%
20%
100%

260,885
155,848
105,456
522,189

101%
66%
81%
86%

50%
30%
20%
100%

______________________
(1) Certain items may not total due to rounding.
Total net revenue increased $556.2 million in 2013 compared to 2012 . Net revenue from our Talent Solutions increased $336.1 million
as a result of further market penetration of our LinkedIn Corporate Solutions product, as evidenced by the 49% increase in the number of
LinkedIn Corporate Solutions customers as of December 31, 2013 compared to December 31, 2012 , and to a lesser extent, sales of additional
services to existing customers. Net revenue from our Marketing Solutions increased $104.1 million due to higher sales volume by our field
sales and self-service advertising solutions and higher average advertising prices. The increase in sales volume is driven by higher user
engagement, which is positively impacted by increases in the number of our registered members, and can be measured, in part, by page views
on our website. During the fiscal year, we launched Sponsored Updates for marketers to show paid content in LinkedIn members' update feeds.
Sponsored Updates is sold through our field sales and online channels, and while currently a small contributor to revenue, we expect this to
become a larger percentage of total Marketing Solutions revenue over time. Net revenue from our Premium Subscriptions increased $116.1
million as a result of an increase in the number of premium subscribers due to increases in member engagement. Specifically, the number of
registered members is a meaningful metric in evaluating and understanding net revenue from our Premium Subscriptions because an increase in
the number of registered members has historically led to a proportionate increase in the number of premium subscribers. In addition, although
still in their early stages, our Sales Solutions products, which are included in Premium Subscriptions and include Sales Navigator, are
continuing to grow at a faster rate than our other Premium Subscription products as well as continuing to represent a larger percentage of total
Premium Subscriptions revenue.
Total net revenue increased $450.1 million in 2012 compared to 2011 . Net revenue from our Talent Solutions increased $262.7 million as
a result of further market penetration of our LinkedIn Corporate Solutions product, as evidenced by the 78% increase in the number of
LinkedIn Corporate Solutions customers as of December 31, 2012 compared to December 31, 2011 . Net revenue from our Marketing
Solutions increased $102.4 million due to higher sales volume by our field sales and self-service advertising solutions, as well as, to a lesser
extent, higher average advertising prices. The increase in sales volume is driven by higher user engagement, which is positively impacted by
increases in the number of our registered members and page views on our website. Net revenue from our Premium Subscriptions increased
$85.0 million as a result of an increase in the number of premium subscribers due to increases in engagement, as evidenced by our key metrics.
In addition, although still in their early stages, our Sales Solutions products, which include Sales Navigator, are continuing to grow at a faster
rate than our other Premium Subscription products.

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The following table presents our net revenue by geographic region:

Year Ended
December 31,
2013

Year Ended
December 31,
2012

% Change

2012

($ in thousands)

Revenue by geographic
region:
United States
Other Americas (1)
Total Americas
EMEA (2)
APAC (3)
Total

942,122
109,672
1,051,794
358,244
118,507
1,528,545

619,485
66,099
685,584
217,342
69,383
972,309

2011

% Change

($ in thousands)

52%
66%
53%
65%
71%
57%

619,485
66,099
685,584
217,342
69,383
972,309

353,834
28,800
382,634
109,995
29,560
522,189

75%
130%
79%
98%
135%
86%

______________________
(1)
Canada, Latin America and South America
(2)
Europe, the Middle East and Africa (EMEA)
(3)
Asia-Pacific (APAC)
International revenue increased $233.6 million in 2013 compared to 2012 , and $184.5 million in 2012 compared to 2011 . International
revenue represented 38% , 36% and 32% of total revenue in 2013 , 2012 and 2011 , respectively. The increase in international revenue, in
absolute dollars and as a percentage of total revenue, is primarily due to the expansion of our international field sales organization and our site
localization efforts. In 2013 , we operated our websites and mobile applications in multiple languages, and continued our expansion outside of
the United States in offices across North America, as well as throughout Europe, Asia, South America, Australia and the Middle East. We
expect international revenue to increase on an absolute basis and as a percentage of revenue in 2014 as we continue to focus expanding our
sales-force outside the United States in key markets where our member engagement supports business efforts at scale.
Cost of Revenue
Our cost of revenue primarily consists of salaries, benefits and stock-based compensation for our production operations, customer
support, infrastructure and advertising operations teams and web hosting costs related to operating our website. Credit card processing fees,
direct costs related to our research products, certain uncollected valued added taxes, or VAT, and sales taxes, allocated facilities costs and other
supporting overhead costs are also included in cost of revenue. Beginning in the fourth quarter of 2011, we began to pass through VAT and
sales tax to our customers on all our products that are subject to taxation. Consistent with our investment philosophy for 2014, we currently
expect cost of revenue to increase on an absolute basis and remain relatively flat as a percentage of revenue.
Year Ended
December 31,
2013

Year Ended
December 31,
2012

% Change

2012

2011

% Change

($ in thousands)

Cost of revenue
Percentage of net revenue
Headcount (at period end)

202,908
13%
793

125,521
13%
497

62%
60%

125,521
13%
497

81,448
16%
338

54%
47%

Cost of revenue increased $77.4 million in 2013 compared to 2012 . The increase was primarily attributable to increases in headcount
related expenses of $36.5 million as we continue to hire to support the growth of our business, web hosting service expenses of $21.8 million ,
other direct costs of $9.1 million , primarily consisting of credit card processing fees, and facilities and related costs of $8.7 million .
Cost of revenue increased $44.1 million in 2012 compared to 2011 . The increase was primarily attributable to increases in headcount
related expenses of $25.8 million as we continue to hire to support the growth of our business, web hosting service expenses of $13.7 million ,
facilities and related costs of $5.2 million and direct costs of $4.7 million . These increases were partially offset by a decrease in taxes of $5.0
million as we continue to pass through VAT and sales tax to our customers.
Sales and Marketing
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Our sales and marketing expenses primarily consist of salaries, benefits, stock-based compensation, travel expense and incentive
compensation for our sales and marketing employees. In addition, sales and marketing expenses include customer acquisition marketing,
branding, advertising, public relations costs, and commissions paid to agencies, as well as allocated facilities and other supporting overhead
costs. We plan to continue to invest heavily in sales and marketing to expand our global footprint, grow our current customer accounts and
continue building brand awareness. Consistent with our investment philosophy for 2014, we expect sales and marketing expense to increase on
an absolute basis and decrease as a percentage of revenue, compared to 2013 .

Year Ended
December 31,
2013

Year Ended
December 31,
2012

% Change

2012

2011

% Change

($ in thousands)

Sales and marketing

Percentage of net revenue
Headcount (at period end)

522,100
34%
2,159

324,896
33%
1,468

61%

47%

324,896
33%
1,468

164,703
32%
844

97%
74%

Sales and marketing expenses increased $197.2 million in 2013 compared to 2012 . The increase was primarily attributable to an increase
in headcount related expenses of $152.2 million as we continue to expand our field sales organization. We also experienced increases in agency
commissions of $17.8 million , facilities and related costs of $16.6 million , consulting services of $6.8 million and marketing and public
relations expenses of $2.6 million .
Sales and marketing expenses increased $160.2 million in 2012 compared to 2011 . The increase was primarily attributable to an increase
in headcount related expenses of $126.9 million as we expanded our field sales organization. We also experienced increases in facilities and
related costs of $12.8 million , marketing and public relations expenses of $7.6 million , consulting services expenses of $6.0 million and
agency commissions of $4.4 million.
Product Development
Our product development expenses primarily consist of salaries, benefits and stock-based compensation for our engineers, product
managers and developers. In addition, product development expenses include outside services and consulting, as well as allocated facilities and
other supporting overhead costs. We believe that continued investment in features, software development tools and code modification is
important to achieving our strategic objectives. Consistent with our investment philosophy for 2014, we expect to continue to invest heavily in
product development; therefore, we expect product development expense to increase on an absolute basis and increase slightly as a percentage
of revenue, compared to 2013 .
Year Ended
December 31,
2013

Year Ended
December 31,
2012

% Change

2012

2011

% Change

($ in thousands)

Product development
Percentage of net revenue
Headcount (at period end)

395,643
26%
1,378

257,179
26%
1,025

54%
34%

257,179
26%
1,025

132,222
25%
634

95%
62%

Product development expenses increased $138.5 million in 2013 compared to 2012 . The increase was primarily attributable to an
increase in headcount related expenses of $128.6 million as a result of our focus on developing new features and products to encourage
member growth and engagement. We also experienced increases in facilities and related costs of $5.8 million , and web hosting service
expenses of $3.3 million .
Product development expenses increased $125.0 million in 2012 compared to 2011 . The increase was primarily attributable to an
increase in headcount related expenses of $101.4 million as a result of our focus on developing new features and products to encourage
member growth and engagement. We also experienced increases in facilities and related costs of $10.5 million , consulting services of $7.7
million and web hosting service expenses of $4.2 million .
General and Administrative
Our general and administrative expenses primarily consist of salaries, benefits and stock-based compensation for our executive, finance,
legal, information technology, human resources and other administrative employees. In addition, general and administrative expenses include
outside consulting, legal and accounting services, and facilities and other supporting
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overhead costs not allocated to other departments. We expect that our general and administrative expenses will increase on an absolute basis in
2014 and remain relatively flat as a percentage of revenue.
Year Ended
December 31,
2013

Year Ended
December 31,
2012

% Change

2012

2011

% Change

($ in thousands)

General and administrative

Percentage of net revenue
Headcount (at period end)

225,566
15%
715

128,002
13%
468

76%

53%

128,002
13%
468

74,871
14%
300

71%
56%

General and administrative expenses increased $97.6 million in 2013 compared to 2012 . The increase was primarily a result of an
increase in headcount related expenses of $66.8 million to support our overall growth. We also experienced increases in legal and consulting
services of $20.4 million , primarily due to increasing litigation and compliance costs, facilities and related costs of $5.0 million and bad debt
expense of $4.8 million .
General and administrative expenses increased $53.1 million in 2012 compared to 2011 . The increase was primarily a result of an
increase in headcount related expenses of $36.8 million to support our overall growth. We also experienced increases in consulting and legal
services of $12.2 million and facilities and related costs of $6.2 million as we continue to expand our office space due to headcount growth.
These increases were partially offset by a decrease in bad debt expense of $2.7 million .
Depreciation and Amortization
Depreciation and amortization expenses primarily consist of depreciation on computer equipment, software, leasehold improvements,
capitalized software development costs and amortization of purchased intangibles. We expect that depreciation and amortization expenses will
increase on an absolute basis and as a percentage of revenue as we continue to expand our technology and facilities infrastructure.
Year Ended
December 31,
2013

Year Ended
December 31,
2012

% Change

2012

2011

% Change

($ in thousands)

Depreciation and amortization

Percentage of net revenue

134,516
9%

79,849
8%

68%

79,849
8%

43,100
8%

85%

Depreciation and amortization expenses increased $54.7 million in 2013 compared to 2012 . The increase in depreciation expense of
$48.1 million was primarily a result of our continued investment in expanding our technology infrastructure in order to support continued
growth in our member base, and to a lesser extent, increases in amortization of acquired intangible assets of $6.5 million .
Depreciation and amortization expenses increased $36.7 million in 2012 compared to 2011 . The increase in depreciation expense of
$30.5 million was primarily a result of our continued investment in expanding our technology infrastructure in order to support continued
growth in our member base, and to a lesser extent, increases in amortization of acquired intangible assets of $6.2 million .
Other Income (Expense), Net
Other income (expense), net consists primarily of the interest income earned on our investments and foreign exchange gains and losses.
Hedging strategies that we have implemented or may implement to mitigate this risk may not eliminate our exposure to foreign exchange
fluctuations.
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Year Ended December 31,

2013

2012

2011

(in thousands)

Interest income
$
Net loss on foreign exchange and foreign currency derivative contracts
Net realized gain on sales of marketable securities
Other non-operating income (expense), net
Total other income (expense), net
$

2,895
(1,626)
127
20
1,416

1,025
(672)
60
(161)
252

169
(2,965)
6
(113)
(2,903)

Other income (expense), net increased $1.2 million in 2013 compared to 2012 , and $3.2 million in 2012 compared to 2011 primarily due
to interest earned on higher investment balances, offset by foreign currency exchange losses.
Provision for Income Taxes
We recognize the tax benefit from an uncertain tax position only if it is more likely than not the tax position will be sustained on
examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the financial statements from
such positions are then measured based on the largest benefit that has a greater than 50% likelihood of being realized upon settlement. For
further information, see Note 12, Income Taxes , of the Notes to the Consolidated Financial Statements under Item 8 for further information.

Year Ended
December 31,
2013

Year Ended
December 31,
2012

% Change

2012

2011

% Change

($ in thousands)

Provision for income taxes

22,459

35,504

(37)%

35,504

11,030

222%

Income tax expense decreased $13.0 million in 2013 compared to 2012 . The effective tax rates as of December 31, 2013 and
December 31, 2012 were 46% and 62% , respectively. The decrease in year-over-year effective tax rates was primarily due to the benefit from
the 2012 and 2013 Federal Research and Experimentation credit offset by increased non-deductible acquisition related expenses and increased
foreign losses for which deferred tax assets have not been recognized. The increase in foreign losses is due primarily to research and
development expenses which grew internationally at a rate which was higher than the growth rate of international revenues. International
research and development expenses include costs charged by LinkedIn Corporation pursuant to U.S. Treasury Regulations and guidelines from
the Organisation for Economic Co-operation and Development ("OECD").
Income tax expense increased by $24.5 million in 2012 compared to 2011 . The increase in income tax expense reflects the increase in
income before taxes, non-deductible stock-based compensation expense, development costs funded by our international subsidiaries and nondeductible acquisition-related expenses. The effective tax rates as of December 31, 2012 and December 31, 2011 were 62% and 48% ,
respectively. The increase in year-over-year effective tax rates was primarily due to increased non-deductible acquisition related expenses, the
suspension of the Federal Research and Experimentation credit, and increased foreign losses for which deferred tax assets have not been
recognized. The increase in foreign losses is due primarily to research and development expenses which grew internationally at a rate which
was higher than the growth rate of international revenues.
On January 2, 2013, the President signed into law The American Taxpayer Relief Act of 2012 (the "2012 Act"). Under prior law, a
taxpayer was entitled to a research tax credit for qualifying amounts paid or incurred on or before December 31, 2011. The 2012 Act extended
the research credit for two years to December 31, 2013. The extension of the research credit was retroactive and includes amounts paid or
incurred after December 31, 2011. As a result of the retroactive extension, we recognized a tax benefit of $15.5 million in the twelve months
ended December 31, 2013 for qualifying amounts incurred in 2012. The federal research credit has not been extended to new research activities
incurred after December 31, 2013. We will therefore not have a similar favorable impact to our effective tax rate in 2014 unless new legislation
is passed which will provide a credit for qualifying amounts generated in 2014.
Quarterly Results of Operations Data
The following tables set forth our unaudited quarterly consolidated statements of operations data and our unaudited statements of
operations data as a percentage of net revenue for each of the eight quarters ended December 31, 2013 . We have prepared the quarterly data on
a consistent basis with the audited consolidated financial statements included in this Annual Report on Form 10-K. In the opinion of
management, the financial information reflects all necessary adjustments, consisting only of normal recurring adjustments, necessary for a fair
presentation of this data. This information should be read in conjunction with the audited consolidated financial statements and related notes
included in Item 8 of this Annual Report on Form 10-K. The results of historical periods are not necessarily indicative of the results of
operations for a full year or any future period.

Dec 31,
2013

Sep 30,
2013

For the Three Months Ended

Mar 31,
Dec 31,
2013
2012

Jun 30,
2013

Sep 30,
2012

Jun 30,
2012

Mar 31,
2012

(in thousands, except per share data)

Consolidated Statements of
Operations Data:
Net revenue

Costs and expenses:

Cost of revenue (exclusive
of depreciation and
amortization shown separately
below) (1)

447,219

392,960

363,661

324,705

303,618

252,028

228,207

188,456

57,865

53,395

49,264

42,384

36,243

33,778

30,367

25,133

Sales and marketing (1)

157,235

133,172

122,276

109,417

100,104

83,168

75,740

65,884

Product development (1)

General and administrative

113,140

106,223

95,608

80,672

77,276

72,730

60,080

47,093

64,790

61,767

56,225

42,784

38,980

33,194

30,974

24,854

(1)

Depreciation and
amortization
Total costs and
expenses

42,750

33,767

32,193

25,806

24,297

23,122

17,548

14,882

435,780

388,324

355,566

301,063

276,900

245,992

214,709

177,846

Income from operations

8,095

23,642

26,718

6,036

13,498

10,610

24

672

11,439

4,636

Other income (expense), net

1,820

156

Income before income taxes

13,259

4,792

7,843

23,334

26,742

6,708

12,830

10,834

Provision for income taxes

9,477

8,155

4,109

718

15,234

4,406

10,019

5,845

Net income (loss)

(252)

(308)

(668)

224

3,782

(3,363 )

3,734

22,616

11,508

2,302

2,811

4,989

Net income (loss) attributable to

common stockholders
$

3,782

(3,363 )

3,734

22,616

11,508

2,302

2,811

4,989

Net income (loss) per share

attributable to common
stockholders:
Basic

0.03

(0.03 )

0.03

0.21

0.11

0.02

0.03

0.05

Diluted

0.03

(0.03 )

0.03

0.20

0.10

0.02

0.03

0.04

Weighted-average shares used

to compute net income (loss)
per share attributable to
common stockholders:

(1)

Basic

119,849

113,940

111,214

109,445

107,924

106,304

104,185

102,210

Diluted

124,438

113,940

116,627

115,398

114,095

113,618

112,317

111,310

Stock-based compensation included in above line items:

Cost of revenue

4,783

4,098

3,913

2,806

2,197

2,182

1,236

801

Sales and marketing

10,630

9,853

8,843

6,861

5,333

5,198

4,327

2,868

Product development

29,152

27,186

24,885

17,638

14,956

14,609

10,572

5,889

General and administrative

Total stock-based
compensation

12,612

13,308

10,713

6,634

5,086

4,809

3,188

3,068

57,177

54,445

48,354

- 52 -

33,939

27,572

26,798

19,323

12,626

Table of Contents

Dec 31,
2013

Sep 30,
2013

For the Three Months Ended

Mar 31,
Dec 31,
2013
2012

Jun 30,
2013

Sep 30,
2012

Jun 30,
2012

Mar 31,
2012

(as a percentage of revenue)

Consolidated Statements of
Operations Data: (1)
Net revenue

100 %

100%

Costs and expenses:

Cost of revenue
Sales and marketing
Product development
General and administrative
Depreciation and amortization
Total costs and expenses
Income from operations
Other income (expense), net
Income before income taxes
Provision for income taxes
Net income (loss)

100 %

100 %

100%

100%

100 %

100%

13

14

14

13

12

13

13

13

35

34

34

34

33

33

33

35

25

27

26

25

25

29

26

25

14

16

15

13

13

13

14

13

10

97

99

98

93

91

98

94

94

4%

1%

1%

3%

1%

1%

(1)%

7%

______________________
(1) Certain items may not total due to rounding.

Dec 31,
2013

Sep 30,
2013

Jun 30,
2013

For the Three Months Ended

Mar 31,
Dec 31,
2013
2012

Sep 30,
2012

Jun 30,
2012

Mar 31,
2012

(in thousands)
Additional Financial Data:
Net revenue by product:
Talent Solutions

Marketing Solutions
Premium Subscriptions
Total

245,622

224,676

205,092

184,284

160,997

138,433

121,592

102,560

113,469

88,502

85,593

74,796

83,187

64,036

63,105

47,950

88,128

79,782

72,976

65,625

59,434

49,559

43,510

37,946

447,219

392,960

363,661

324,705

303,618

252,028

228,207

188,456

271,140

245,302

224,277

201,403

189,006

162,377

147,253

120,849

Net revenue by geographic

location:
United States
Other Americas (1)

31,612

27,027

26,857

24,176

21,909

17,134

15,047

12,009

Total Americas

302,752

272,329

251,134

225,579

210,915

179,511

162,300

132,858

EMEA (2)

108,309

90,087

84,691

75,157

69,910

54,530

50,057

42,845

APAC (3)

36,158

30,544

27,836

23,969

22,793

17,987

15,850

12,753

Total

447,219

392,960

363,661

324,705

303,618

252,028

228,207

188,456

270,672

227,588

209,227

183,971

178,364

143,176

129,448

101,471

Net revenue by field sales and

online sales:
Field sales
Online sales
Total

176,547
$

447,219

165,372
$

392,960

154,434
$

363,661

140,734
$

______________________
(1)
Canada, Latin America and South America
(2)
Europe, the Middle East and Africa (EMEA)
(3)
Asia-Pacific (APAC)

- 53 -

324,705

125,254
$

303,618

108,852
$

252,028

98,759
$

228,207

86,985
$

188,456

Table of Contents

Dec 31,
2013

Sep 30,
2013

For the Three Months Ended

Mar 31,
Dec 31,
2013
2012

Jun 30,
2013

Sep 30,
2012

Jun 30,
2012

Mar 31,
2012

(in thousands, except customer and headcount data)

Other Financial and
Operational Data:
Adjusted EBITDA (1)
Number of registered members
(at period end)
LinkedIn Corporate Solutions
customers (at period end)
Headcount (at period end):

92,848

88,642

83,387

78,587

55,956

50,369

38,118

276,842

259,179

238,072

218,269

201,912

187,419

173,945

160,566

24,444

22,001

20,256

18,138

16,409

13,991

12,283

10,531

United States

3,435

3,304

2,967

2,668

2,464

2,266

2,047

1,810

International

1,610

1,508

1,274

1,111

994

911

814

637

5,045

4,812

4,241

3,779

3,458

3,177

2,861

2,447

Total
(1)

111,366

We define adjusted EBITDA as net income (loss), plus: provision for income taxes, other (income) expense, net, depreciation and amortization, and stock-based
compensation. Please see Adjusted EBITDA in Item 6 Selected Financial Data for more information.

Dec 31,
2013

Sep 30,
2013

Jun 30,
2013

For the Three Months Ended

Mar 31,
Dec 31,
2013
2012

Sep 30,
2012

Jun 30,
2012

Mar 31,
2012

(in thousands)
Reconciliation of adjusted
EBITDA:
Net income (loss)

3,782

Provision for income taxes

9,477

Other (income) expense, net

(1,820)

Depreciation and amortization

42,750

Stock-based compensation

57,177

Adjusted EBITDA

111,366

(3,363)

8,155

22,616

11,508

4,989

718
308

33,767

32,193

25,806

24,297

23,122

17,548

14,882

54,445

48,354

33,939

27,572

26,798

19,323

12,626

88,642

83,387

4,406

2,811

252

92,848

15,234

2,302

4,109

(156)

3,734

(24)

78,587

10,019

(672)

55,956

5,845

668

50,369

(224)

38,118

Liquidity and Capital Resources

Year Ended December 31,
2013

2012

2011

(in thousands)

Consolidated Statements of Cash Flows Data:

Purchases of property and equipment
Depreciation and amortization
Cash flows provided by operating activities
Cash flows used in investing activities
Cash flows provided by financing activities

278,019
134,516

436,473
(1,357,545)
1,454,219

125,420
79,849

88,978
43,100

267,070
(433,028)
96,563

133,424
(338,482)
452,465

As of December 31, 2013 , we had cash and cash equivalents of $803.1 million and marketable securities of $1,526.2 million . Our cash
equivalents and marketable securities are comprised primarily of money market funds, U.S. treasury securities, U.S. agency securities and
corporate debt securities. As of December 31, 2013 , the amount of cash and cash equivalents held by foreign subsidiaries was $153.9 million .
If these funds are needed for our domestic operations, we would be required to accrue and pay U.S. taxes to repatriate these funds. However,
our intent is to permanently reinvest these funds outside the U.S. and our current plans do not demonstrate a need to repatriate them to fund our
domestic operations. We do not provide for federal income taxes on the undistributed earnings of our foreign subsidiaries. However, we believe
the income tax liability would be insignificant if these earnings were to be repatriated. We believe that our existing cash and cash equivalents
and marketable securities balances, together with cash generated from operations, will be sufficient to meet our working capital expenditure
requirements for at least the next 12 months.
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Operating Activities
Operating activities provided $436.5 million of cash in 2013 , as a result of our improved operating performance compared to 2012 . The
cash flow from operating activities consisted primarily of the changes in our operating assets and liabilities, with deferred revenue increasing
$134.5 million and accounts payable and other liabilities increasing $114.7 million , partially offset by an increase in accounts receivable of
$102.6 million , and an increase in excess tax benefit from stock-based compensation of $43.8 million , which is reclassified as a financing
activity. The increases in our deferred revenue and accounts payable and other liabilities were primarily due to increases in transaction volumes
in 2013 compared to 2012 . We had net income in 2013 of $26.8 million , which included non-cash stock-based compensation of $193.9
million and non-cash depreciation and amortization of $134.5 million .
Operating activities provided $267.1 million of cash in 2012 , primarily resulting from our improved operating performance as compared
to the prior year. The cash flow from operating activities consisted primarily of the changes in our operating assets and liabilities, with deferred
revenue increasing $117.9 million and accounts payable and other liabilities increasing $85.6 million , partially offset by an increase in
accounts receivable of $91.3 million , an increase in excess tax benefit from the exercise of stock options of $35.8 million , which is
reclassified as a financing activity, and an increase in prepaid expenses and other assets of $7.7 million . The increases in our deferred revenue
and accounts receivable were primarily due to increases in transaction volumes in 2012 compared to 2011. We had net income in 2012 of $21.6
million , which included non-cash depreciation and amortization of $79.8 million and non-cash stock-based compensation of $86.3 million .
Operating activities provided $133.4 million of cash in 2011, primarily resulting from our improved operating performance as compared
to the prior year. The cash flow from operating activities primarily resulted from changes in our operating assets and liabilities, with deferred
revenue increasing $74.8 million and accounts payable and other liabilities increasing $37.0 million, partially offset by an increase in accounts
receivable of $54.9 million and an increase in prepaid expenses and other assets of $14.1 million. The increases in our deferred revenue and
accounts receivable were primarily due to our revenue growth in 2011 as compared to 2010. We had net income in 2011 of $11.9 million,
which included non-cash depreciation and amortization of $43.1 million and non-cash stock-based compensation of $29.8 million.
Investing Activities
Our primary investing activities consisted of purchases of investments, purchases of property and equipment specifically related to the
build out of our data centers, as well as payments for intangible assets and strategic acquisitions. We also continued to invest in technology
hardware to support our growth, software to support website functionality development, website operations and our corporate infrastructure.
Purchases of property and equipment may vary from period to period due to the timing of the expansion of our operations and website and
internal-use software development. We expect to continue to invest in property and equipment and development of software in 2014. Our
planned purchases of property and equipment for 2014 are expected to be in the range of $365 million and $385 million.
In 2013 , we had net purchases of investments of $1,055.4 million , purchases of property and equipment of $278.0 million , and
payments for intangible assets and acquisitions, net of cash acquired, of $19.2 million . In 2012, we had net purchases of investments of $245.5
million , purchases of property and equipment of $125.4 million , and made payments for intangible assets and acquisitions, net of cash
acquired, of $57.0 million . In 2011, we had net purchases of investments of $239.4 million, purchases of property and equipment of $89.0
million, and made payments for intangible assets and acquisitions, net of cash acquired, of $7.4 million.
Financing Activities
Our financing activities in 2013 consisted primarily of $1,348.1 million in proceeds from our follow-on offering, net of underwriting
discounts and commissions and other costs associated with this offering. With the exception of the offering, the remainder of our financing
activities consisted primarily of the excess tax benefit from stock-based compensation, and the net proceeds from the issuance of common
stock from employee stock option exercises.
Our financing activities in 2012 consisted primarily of net proceeds from the issuance of common stock from employee option exercises
and stock purchase plan, as well as the excess tax benefit from the exercise of stock options.
Our financing activities in 2011 consisted primarily of $426.5 million in proceeds from our IPO and follow-on offering, net of offering
costs. Our financing activities in 2011 also included net proceeds from the issuance of common stock from employee option exercises.
Off Balance Sheet Arrangements
We did not have any off balance sheet arrangements in 2013, 2012 or 2011.
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Table of Contents

Contractual Obligations
We lease office space for our headquarters in Mountain View, California under operating leases that we expect to expire in 2023. We
lease other facilities around the world, including office space in Sunnyvale, California, to be constructed by our landlord, the longest of which
expires in 2026. We have several material long-term purchase obligations outstanding with third parties. We do not have any debt or material
capital lease obligations. As of December 31, 2013 , the following table summarizes our contractual obligations and the effect such obligations
are expected to have on our liquidity and cash flow in future periods:

Less Than
1 Year

Total

Payments Due by Period

1-3
Years

3-5
Years

More Than
5 Years

(in thousands)

Operating lease obligations (1)

Purchase obligations

$
$

965,368
76,347

$
$

71,126
46,270

$
$

192,937
25,434

$
$

176,014
4,643

$
$

525,291

(1) Subsequent to December 31, 2013 , we leased additional space in New York, New York. The lease expires in
2026 and aggregate future minimum lease payments for this facility are approximately $25.6 million .
The contractual commitment amounts in the table above are associated with agreements that are enforceable and legally binding.
Obligations under contracts that we can cancel without a significant penalty are not included in the table above.
Contingent obligations arising from unrecognized tax benefits are not included in the contractual obligations because it is expected that
the unrecognized benefits would only result in an insignificant amount of cash payments.
Item 7A.

Quantitative and Qualitative Disclosure about Market Risk

We have operations both within the United States and internationally, and we are exposed to market risks in the ordinary course of our
business. These risks include primarily interest rate, foreign exchange risks and inflation.
Interest Rate Fluctuation Risk
We had cash, cash equivalents, and marketable securities of $2,329.3 million and $749.5 million as of December 31, 2013 and 2012 ,
respectively. This amount was invested primarily in money market funds and highly liquid investment grade fixed income securities. The cash,
cash equivalents and marketable securities are held for working capital purposes. Our investment policy and strategy is focused on the
preservation of capital and supporting our liquidity requirements. We do not enter into investments for trading or speculative purposes. At
December 31, 2013 , the weighted-average duration of our investment portfolio was less than one year.
Our fixed-income portfolio is subject to fluctuations in interest rates, which could affect our results of operations. Based on our
investment portfolio balance as of December 31, 2013 , a hypothetical increase in interest rates of 1% (100 basis points) would have resulted in
a decrease in the fair value of our portfolio of approximately $13.8 million , and a hypothetical increase of 0.5% (50 basis points) would have
resulted in a decrease in the fair value of our portfolio of approximately $6.9 million .
Foreign Currency Exchange Risks
We have foreign currency exchange risks related to our revenue and operating expenses denominated in currencies other than the U.S.
dollar, principally the British Pound Sterling, the Euro, the Australian dollar, the Canadian dollar, the Indian rupee and the Singapore dollar.
The volatility of exchange rates depends on many factors that we cannot forecast with reliable accuracy. We have experienced and will
continue to experience fluctuations in our net income as a result of gains (losses) related to remeasuring certain monetary assets and liabilities
that are denominated in currencies other than the U.S. dollar. In the event our foreign currency denominated assets, liabilities, sales or expenses
increase, our operating results may be more greatly affected by fluctuations in the exchange rates of the currencies in which we do business.
We enter into foreign currency derivative contracts to hedge against assets and liabilities for which we have foreign currency exposure to
minimize the risk that our earnings will be adversely affected by exchange rate fluctuations. Our foreign currency derivative contracts are not
designated as hedging instruments. These derivative instruments are carried at fair value with changes in the fair value recorded to other
income (expense), net in our consolidated statements of operations. These
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Table of Contents

contracts do not subject us to material balance sheet risk due to exchange rate movements because gains and losses on these derivatives are
intended to offset gains and losses on the hedged foreign currency denominated assets and liabilities.
As of December 31, 2013 , we had outstanding foreign currency derivative contracts with a total notional amount of $94.8 million . If
overall foreign currency exchange rates appreciated (depreciated) uniformly by 5% against the U.S. dollar, our foreign currency derivative
contracts outstanding as of December 31, 2013 would experience a loss (gain) of approximately $4.6 million .
Inflation Risk
We do not believe that inflation has had a material effect on our business, financial condition or results of operations. If our costs were to
become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases. Our inability
or failure to do so could harm our business, financial condition and results of operations.
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Table of Contents

Item 8.

Financial Statements and Supplementary Data

LINKEDIN CORPORATION
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
Page

Report of Independent Registered Public Accounting Firm

Consolidated Balance Sheets
Consolidated Statements of Operations
Consolidated Statements of Comprehensive Income
Consolidated Statements of Redeemable Convertible Preferred Stock and Stockholders Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements

59
60
61
62
63
64
65

The supplementary financial information required by this Item 8 is included in Item 7 under the caption Quarterly Results of
Operations.

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Table of Contents

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
LinkedIn Corporation
Mountain View, California
We have audited the accompanying consolidated balance sheets of LinkedIn Corporation and subsidiaries (the Company) as of
December 31, 2013 and 2012 , and the related consolidated statements of operations, comprehensive income, redeemable convertible preferred
stock and stockholders equity, and cash flows for each of the three years in the period ended December 31, 2013 . These financial statements
are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our
audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of LinkedIn
Corporation and subsidiaries as of December 31, 2013 and 2012 , and the results of their operations and their cash flows for each of the three
years in the period ended December 31, 2013 , in conformity with accounting principles generally accepted in the United States of America.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the
Company's internal control over financial reporting as of December 31, 2013 , based on the criteria established in Internal Control - Integrated
Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 13, 2014
, expressed an unqualified opinion on the Company's internal control over financial reporting.
/s/ DELOITTE & TOUCHE LLP
San Jose, California
February 13, 2014
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Table of Contents

LINKEDIN CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
December 31,
2013

ASSETS
CURRENT ASSETS:
Cash and cash equivalents
$
Marketable securities
Accounts receivable (net of allowance for doubtful accounts of $6,138 and $3,774 at December 31,
2013 and 2012, respectively)
Deferred commissions
Prepaid expenses
Other current assets
Total current assets
Property and equipment, net
Goodwill
Intangible assets, net
Other assets
TOTAL ASSETS
$
LIABILITIES AND STOCKHOLDERS EQUITY
CURRENT LIABILITIES:
Accounts payable
$
Accrued liabilities
Deferred revenue
Total current liabilities
DEFERRED TAX LIABILITIES
OTHER LONG TERM LIABILITIES
Total liabilities
COMMITMENTS AND CONTINGENCIES (Note 10)
REDEEMABLE NONCONTROLLING INTEREST
STOCKHOLDERS EQUITY (Note 11):
Class A common stock, $0.0001 par value; 1,000,000,000 shares authorized, 103,218,118 and
103,194,534 shares issued and outstanding, respectively, at December 31, 2013 and 89,861,658 and
88,829,278 shares issued and outstanding, respectively, at December 31, 2012
Class B common stock, $0.0001 par value; 120,000,000 shares authorized, 17,157,215 and
19,817,923 shares issued and outstanding at December 31, 2013 and 2012, respectively
Additional paid-in capital
Accumulated other comprehensive income
Accumulated earnings
Total stockholders equity
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTEREST AND STOCKHOLDERS
EQUITY
$
See notes to consolidated financial statements.
- 60 -

2012

803,089
1,526,212
302,168
47,496
32,114
44,391
2,755,470
361,741
150,871
43,046
41,665
3,352,793

66,744
183,004
392,243
641,991
14,879
61,529
718,399

270,408
479,141
203,607
30,232
14,344
21,065
1,018,797
186,677
115,214
32,780
28,862
1,382,330

53,559
104,077
257,743
415,379
27,717
30,810
473,906

5,000

10

2
2,573,449
314
55,619
2,629,394

2
879,303
260
28,850
908,424

3,352,793

1,382,330

Table of Contents

LINKEDIN CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Year Ended December 31,
2013

Net revenue
$
Costs and expenses:
Cost of revenue (exclusive of depreciation and amortization shown
separately below)
Sales and marketing
Product development
General and administrative
Depreciation and amortization
Total costs and expenses
Income from operations
Other income (expense), net
Income before income taxes
Provision for income taxes
Net income
$
Net income per share of common stock:
Basic
Diluted

2012

972,309

202,908
522,100
395,643
225,566
134,516
1,480,733
47,812
1,416
49,228
22,459
26,769

$
$

Weighted-average shares used to compute net income per share:

Basic
Diluted

1,528,545

2011

522,189

125,521
324,896
257,179
128,002
79,849
915,447
56,862
252
57,114
35,504
21,610

81,448
164,703
132,222
74,871
43,100
496,344
25,845
(2,903)
22,942
11,030
11,912

0.24

0.21

0.15

0.23

0.19

0.11

113,643

105,166

77,185

118,944

112,844

104,118

See notes to consolidated financial statements.

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LINKEDIN CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands)

Year Ended December 31,

2013

Net income
Other comprehensive income:
Change in unrealized gains on investments, net of tax
Less: reclassification adjustment for net investment gains included in net
income, net of tax
Total other comprehensive income
Comprehensive income

2012

26,769
113

(59)
54
26,823

See notes to consolidated financial statements.

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2011

21,610

273

(113)
160
21,770

11,912
103

103
12,015

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LINKEDIN CORPORATION
CONSOLIDATED STATEMENTS OF REDEEMABLE CONVERTIBLE PREFERRED STOCK
AND STOCKHOLDERS EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
(In thousands, except shares)
Stockholders Equity

Redeemable
Convertible
Preferred Stock
Shares
BALANCEDecember 31,
2010
Issuance of common stock
upon initial public offering,
net of offering costs
Conversion of preferred
stock to common stock
upon initial public offering
Issuance of common stock
in connection with followon offering, net of offering
costs
Issuance of common stock
upon exercise of employee
stock options
Issuance of common stock
in connection with
employee stock purchase
plan
Issuance of common stock
related to acquisitions
Vesting of early exercised
stock options
Repurchase of unvested
early exercised stock
options
Stock-based compensation

Convertible Preferred Stock

Amount

Shares

Additional
Paid-In
Capital

Common Stock

Amount

Shares

Accumulated
Other
Comprehensive
Income
(Loss)

Accumulated
Earnings
(Deficit)

Total

Amount

10,957,631

$ 87,981

34,689,570

$ 15,846

43,308,742

6,003,804

248,405

248,406

45,647,201

103,822

87,981

(10,957,631)

Excess income tax benefit

from stock-based
compensation
Change in net unrealized
gain on investments
Net income
BALANCEDecember 31,
2011

(87,981)

(34,689,570)

(15,846)

25,074

(3 )

(4,672 )

36,249

2,583,755

177,318

177,318

3,665,152

13,068

13,068

164,367

6,287

6,287

129,203

8,059

8,059

3,704

3,704

30,292

30,292

1,600

1,600

103

103

11,912

11,912

101,480,394

7,240

$ 624,979

(21,830)

10

617,629

100

Stockholders Equity

Redeemable
Convertible
Preferred Stock
Shares
BALANCEDecember 31,
2011
Issuance of common stock
upon exercise of employee
stock options
Issuance of common stock
upon vesting of restricted
stock units
Issuance of common stock
in connection with
employee stock purchase
plan
Issuance of common stock
related to acquisitions, net
of reacquired shares
Vesting of early exercised
stock options
Repurchase of unvested
early exercised stock
options
Stock-based compensation
Excess income tax benefit
from stock-based
compensation

Amount
$

Convertible Preferred
Stock
Shares

Amount
$

Additional
Paid-In
Capital

Common Stock
Shares

Accumulated
Other
Comprehensive
Income
(Loss)

Accumulated
Earnings
(Deficit)

Total

Amount

101,480,394

5,864,624

44,401

44,402

293,701

232,994

16,862

16,862

860,497

71,478

71,478

3,365

3,365

89,739

89,739

35,829

35,829

(85,009)

10

617,629

100

7,240

624,979

Change in net unrealized

gain on investments

160

160

Net income
BALANCEDecember 31,
2012
Issuance of common stock
in connection with followon offering, net of offering
costs
Issuance of common stock
upon exercise of employee
stock options
Issuance of common stock
upon vesting of restricted
stock units
Issuance of common stock
in connection with
employee stock purchase
plan
Issuance of common stock
related to acquisitions, net
of reacquired shares
Vesting of early exercised
stock options
Repurchase of unvested
early exercised stock
options

21,610

21,610

108,647,201

6,188,340

1,348,058

1,348,059

3,659,817

32,824

32,824

1,154,252

217,743

24,589

24,589

487,958

40,834

40,834

937

937

Stock-based compensation
Excess income tax benefit
from stock-based
compensation
Change in net unrealized
gain on investments

203,149

203,149

43,755

43,755

54

54

26,769

26,769

120,351,749

Net income
BALANCEDecember 31,
2013

(3,562)

11

12

879,303

2,573,449

See notes to consolidated financial statements.

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260

314

28,850

55,619

908,424

2,629,394

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LINKEDIN CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Year Ended December 31,
2013

OPERATING ACTIVITIES:
Net income
$
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization
Provision for doubtful accounts and sales returns
Stock-based compensation
Excess income tax benefit from stock-based compensation
Changes in operating assets and liabilities:
Accounts receivable
Deferred commissions
Prepaid expenses and other assets
Accounts payable and other liabilities
Income taxes, net
Deferred revenue
Net cash provided by operating activities
INVESTING ACTIVITIES:
Purchases of property and equipment
Purchases of investments
Sales of investments
Maturities of investments
Payments for intangible assets and acquisitions, net of cash acquired
Changes in deposits and restricted cash
Net cash used in investing activities
FINANCING ACTIVITIES:
Proceeds from initial public offering, net of offering costs
Proceeds from follow-on offering, net of offering costs
Proceeds from issuance of preferred shares in joint venture
Proceeds from issuance of common stock from employee stock options
Proceeds from issuance of common stock from employee stock purchase plan
Excess income tax benefit from stock-based compensation
Other financing activities
Net cash provided by financing activities
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH
EQUIVALENTS
CHANGE IN CASH AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTSBeginning of period
CASH AND CASH EQUIVALENTSEnd of period
$

2012

26,769

2011

21,610

11,912

134,516
4,775
193,915
(43,755)

79,849
623
86,319
(35,829)

43,100
3,109
29,768
(1,600)

(102,618)
(18,249)
(11,213)
114,713
3,120
134,500
436,473

(91,277)
(17,145)
(7,663)
85,561
27,077
117,945
267,070

(54,908)
(5,271)
(14,111)
36,950
9,662
74,813
133,424

(278,019)
(1,493,754)
179,904
258,425
(19,197)
(4,904)
(1,357,545)

(125,420)
(443,992)
58,594
139,911
(57,036)
(5,085)
(433,028)

(88,978)
(251,174)
8,255
3,500
(7,404)
(2,681)
(338,482)

1,348,059
4,600
32,824
24,589
43,755
392
1,454,219

(382)

44,402
16,862
35,829
(148)
96,563

248,803
177,700

13,124
6,287
1,600
4,951
452,465

(1,310)
246,097
92,951
339,048

(466)
532,681
270,408
803,089

755
(68,640)
339,048
270,408

6,049

2,828

2,261

103,827

Purchases of property and equipment recorded in accounts payable and

accrued liabilities

25,724

22,223

10,974

Offering costs not yet paid

382

Vesting of early exercised stock options

937

3,365

3,704

SUPPLEMENTAL DISCLOSURES OF OTHER CASH FLOW INFORMATION:

Cash paid for income taxes
$
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND
FINANCING ACTIVITIES:
Conversion of preferred stock to common stock

Issuance of Class A common stock and stock options for business

combinations

40,927

See notes to consolidated financial statements.

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71,478

8,059

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Notes to Consolidated Financial Statements

1.

Description of Business and Summary of Significant Accounting Policies

LinkedIn Corporation and its subsidiaries (the Company), a Delaware corporation, was incorporated on March 6, 2003 . The Company
operates an online professional network on the Internet through which the Companys members are able to create, manage and share their
professional identities online, build and engage with their professional networks, access shared knowledge and insights, and find business
opportunities, enabling them to be more productive and successful. The Company believes it is the most extensive, accurate and accessible
network focused on professionals.
Certain Significant Risks and Uncertainties
The Company operates in a dynamic industry and, accordingly, can be affected by a variety of factors. For example, management of the
Company believes that changes in any of the following areas could have a significant negative effect on the Company in terms of its future
consolidated financial position, results of operations, or cash flows: scaling and adaptation of existing technology and network infrastructure;
protection of customers information and privacy concerns; security measures related to the Companys website; rates of revenue growth;
engagement and usage of the Companys solutions; management of the Companys growth; new markets and international expansion;
protection of the Companys brand and intellectual property; competition in the Companys market; qualified employees and key personnel;
intellectual property infringement and other claims; and changes in government regulation affecting the Companys business, among other
things.
Principles of Consolidation
The consolidated financial statements include the Company, its wholly-owned subsidiaries, and variable interest entities in which
LinkedIn is the primary beneficiary in accordance with the consolidation accounting guidance. All intercompany balances and transactions
have been eliminated.
Redeemable noncontrolling interest is included within the equity section in the consolidated balance sheets. Redeemable noncontrolling
interest is considered to be temporary equity and is therefore reported outside of permanent equity at the greater of the initial carrying amount
adjusted for the noncontrolling interests share of earnings, or its redemption value.
Use of Estimates
The preparation of the Companys consolidated financial statements in conformity with generally accepted accounting principles
(GAAP) in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of
income and expenses during the reporting period. These estimates are based on information available as of the date of the consolidated
financial statements; therefore, actual results could differ from managements estimates.
Concentrations of Credit Risk
Financial instruments, which potentially subject the Company to concentrations of credit risk, consist primarily of cash and cash
equivalents, marketable securities, foreign exchange contracts and accounts receivable. Although the Company deposits its cash with multiple
high credit quality financial institutions, its deposits, at times, may exceed federally insured limits. The Company's investment portfolio
consists of investment grade securities diversified amongst security types, industries, and issuers. The Company's investment policy limits the
amount of credit exposure to a maximum of 5% for any one issuer, except for its U.S. treasury and agency securities, and the Company
believes no significant concentration risk exists with respect to these investments. Foreign exchange contracts are transacted with various
financial institutions with high credit standings.
Credit risk with respect to accounts receivable is dispersed due to the large number of customers, none of which accounted for more than
10% of total accounts receivable as of December 31, 2013 and 2012 . In addition, the Companys credit risk is mitigated by the relatively short
collection period. The Company records accounts receivable at the invoiced amount and does not charge interest. Collateral is not required for
accounts receivable. The Company maintains an allowance for doubtful accounts receivable balances. The allowance is based upon historical
loss patterns, the number of days that billings are past due, and an evaluation of the potential risk of loss associated with delinquent accounts.
The following table presents the changes in the allowance for doubtful accounts (in thousands):
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Year Ended December 31,

2013

Allowance for doubtful accounts:

Balance, beginning of period
Add: bad debt expense (credit)
Less: write-offs, net of recoveries and other adjustments
Balance, end of period

2012

3,774
4,130
(1,766)
6,138

2011

5,460
(176)
(1,510)
3,774

2,672
2,526
262
5,460

Foreign Currency
The functional currency of the Company's foreign subsidiaries is generally the U.S. dollar. Transaction gains and losses are included in
other income (expense), net in the accompanying consolidated statements of operations.
Cash Equivalents
Cash equivalents consist of highly liquid marketable securities with original maturities of three months or less at the time of purchase and
consist primarily of money market funds, commercial paper, U.S. treasury securities and U.S. agency securities. Cash equivalents are stated at
fair value.
Marketable Securities
Marketable securities consist of commercial paper, certificates of deposit, U.S. treasury securities, U.S. agency securities, corporate debt
securities and municipal securities, and are classified as available-for-sale securities. As the Company views these securities as available to
support current operations, it has classified all available-for-sale securities as short-term. Available-for-sale securities are carried at fair value
with unrealized gains and losses reported as a component of accumulated other comprehensive income in stockholders' equity, while realized
gains and losses and other-than-temporary impairments are reported as a component of net income. For the periods presented, realized and
unrealized gains and losses on investments were not material. An impairment charge is recorded in the consolidated statements of operations
for declines in fair value below the cost of an individual investment that are deemed to be other than temporary. The Company assesses whether
a decline in value is temporary based on the length of time that the fair market value has been below cost, the severity of the decline and the
intent and ability to hold or sell the investment. The Company did not identify any marketable securities as other-than-temporarily impaired as
of December 31, 2013 and 2012 .
Fair Value of Financial Instruments
The Company applies fair value accounting for all financial assets and liabilities and non-financial assets and liabilities that are
recognized or disclosed at fair value in the financial statements on a recurring basis. Fair value is based on an expected exit price as defined by
the authoritative guidance on fair value measurements, which represents the amount that would be received on the sale of an asset or paid to
transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value may be based on assumptions
that market participants would use in pricing an asset or liability. The authoritative guidance on fair value measurements establishes a
consistent framework for measuring fair value on either a recurring or nonrecurring basis whereby inputs, used in valuation techniques, are
assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value:
Level 1 : Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2: Inputs reflect: quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or
liabilities in active markets; inputs other than quoted prices that are observable for the assets or liabilities; or inputs that are derived
principally from or corroborated by observable market data by correlation or other means.
Level 3: Unobservable inputs reflecting the Companys assumptions incorporated in valuation techniques used to determine fair value.
These assumptions are required to be consistent with market participant assumptions that are reasonably available.
The valuation techniques used to measure the fair value of money market funds and treasury securities were derived from quoted market
prices for identical instruments in active markets. The valuation technique used to measure the fair value of the Companys Level 2 fixed
income securities are obtained from an independent pricing service, which may use quoted market prices for identical or comparable
instruments or model-driven valuation using significant inputs derived from or corroborated by observable market data. The Company's
procedures include controls to ensure that appropriate fair values are recorded, including
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comparing the fair values obtained from the Company's pricing service against fair values obtained from another independent source.
Deferred Commissions
Deferred commissions are the incremental costs that are directly associated with non-cancelable subscription contracts primarily related
to sales of the Companys Talent Solutions products. Deferred commissions consist of sales commissions paid to the Companys direct sales
representatives and certain third-party agencies and are deferred and amortized over the non-cancelable terms of the related customer contracts,
which are generally 12 months. The commission payments are generally paid in full the month after the customer contract is signed. The
deferred commission amounts are recoverable through future revenue streams under the non-cancelable customer contracts. The Company
believes the commission charges are so closely related to the revenue from the non-cancelable customer contracts that they should be recorded
as an asset and charged to expense over the same period that the subscription revenue is recognized. Short-term deferred commissions are
included in deferred commissions while long-term deferred commissions are included in other assets in the accompanying consolidated balance
sheets. The amortization of deferred commissions is included in sales and marketing expense in the accompanying consolidated statements of
operations.
Derivative Financial Instruments
The Company enters into foreign currency derivative contracts with financial institutions to reduce the risk that its cash flows and
earnings will be adversely affected by foreign currency exchange rate fluctuations. The Company's foreign currency derivative contracts, which
are not designated as hedging instruments, are used to reduce the exchange rate risk associated with its foreign currency denominated monetary
assets and liabilities. The Company's program is not designated for trading or speculative purposes. The foreign currency derivative contracts
that were not settled as of December 31, 2013 and 2012 are recorded at fair value in the consolidated balance sheets. Foreign currency
derivative contracts are marked-to-market at the end of each reporting period and the related gains and losses are recognized in other income
(expense), net of transaction gains or losses related to the hedged items in the accompanying consolidated statements of operations.
Net realized and unrealized gains and losses were not material for the years ended December 31, 2013 , 2012 , and 2011 . As of
December 31, 2013 and 2012 , the Company had outstanding foreign currency derivative contracts with a total notional amount of $94.8
million and $83.5 million , respectively.
Property and Equipment
Property and equipment are stated at cost, less accumulated depreciation and amortization. Depreciation is computed using the straightline method over the estimated useful lives of the assets, which range from two to five years. Leasehold improvements are amortized over the
shorter of the lease term or expected useful lives of the improvements. Depreciation expense totaled $118.1 million , $70.0 million and $39.5
million for the years ended December 31, 2013 , 2012 and 2011 , respectively.
Website and Internal-Use Software Development Costs
The Company capitalizes certain costs to develop its website and internal-use software when preliminary development efforts are
successfully completed, management has authorized and committed project funding, and it is probable that the project will be completed and
the software will be used as intended. Such costs are amortized on a straight-line basis over the estimated useful life of the related asset, which
approximates two to three years. Costs incurred prior to meeting these criteria, together with costs incurred for training and maintenance, are
expensed as incurred.
The Company capitalized website and internal-use software costs of $39.3 million , $20.0 million and $10.9 million for the years ended
December 31, 2013 , 2012 and 2011 , respectively. The Companys capitalized website and internal-use software amortization is included in
depreciation and amortization in the Companys consolidated statements of operations, and totaled $15.6 million , $11.2 million and $5.4
million for the years ended December 31, 2013 , 2012 and 2011 , respectively. The Company had unamortized capitalized website and internaluse software of $44.3 million and $20.7 million in the consolidated balance sheets as of December 31, 2013 and 2012 , respectively.
Goodwill, Intangible Assets, Long-Lived Assets and Impairment Assessments
Goodwill. Goodwill represents the excess of the purchase price of an acquired business over the fair value of the underlying net tangible
and intangible assets. Goodwill is evaluated for impairment annually in the third quarter of the Company's fiscal year, and whenever events or
changes in circumstances indicate the carrying value of goodwill may not be recoverable. Triggering events that may indicate impairment
include, but are not limited to, a significant adverse change in
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customer demand or business climate that could affect the value of goodwill or a significant decrease in expected cash flows. Since inception
through December 31, 2013 , the Company did not have any goodwill impairment.
Intangible assets . Intangible assets consist of identifiable intangible assets, primarily developed technology, resulting from the
Company's acquisitions. Acquired intangible assets are recorded at cost, net of accumulated amortization. Intangible assets are amortized on a
straight-line basis over their estimated useful lives.
Long-lived assets . The Company evaluates its long-lived assets for impairment, including property and equipment and intangible assets,
whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. Recoverability of assets
to be held and used is measured by a comparison of the carrying amount of an asset to future undiscounted net cash flows expected to be
generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the
carrying amount of the assets exceeds the fair value of the assets.
Legal Contingencies
The Company is regularly subject to claims, lawsuits, investigations, and other proceedings that arise in the ordinary course of business.
Certain of these matters include speculative claims for substantial or indeterminate amounts of damages. The Company records a liability when
it believes that it is both probable that a loss has been incurred, and the amount can be reasonably estimated. Significant judgment is required to
determine both likelihood of there being and the estimated amount of a loss related to such matters. The Company periodically evaluates
developments in its legal matters that could affect the amount of liability that it has previously accrued, if any, and adjusts accordingly to reflect
the impact of negotiations, settlements, rulings, advice of legal counsel, and updated information. Until the final resolution of such matters,
there may be an exposure to loss in excess of the amount recorded, and such amounts could be material. Any estimates and assumptions that
change or prove to have been incorrect could have a material impact on the Company's business, consolidated financial position, results of
operations, or cash flows.
In managements opinion, there was not at least a reasonable possibility that the Company may have incurred a material loss, or a
material loss in excess of a recorded accrual, with respect to loss contingencies for legal and other contingencies as of December 31, 2013 .
However, the outcome of litigation is inherently uncertain. Therefore, although management considers the likelihood of such an outcome to be
remote, if one or more of these legal matters were resolved against the Company in the same reporting period for amounts in excess of
management's expectations, its consolidated financial statements of a particular reporting period could be materially adversely affected.
Revenue Recognition
In general, the Company recognizes revenue when (i) persuasive evidence of an arrangement exists, (ii) delivery has occurred or services
have been rendered to the customer, (iii) the fee is fixed or determinable, and (iv) collectability is reasonably assured. Where arrangements
have multiple elements, revenue is allocated to the elements based on the relative selling price method and revenue is recognized based on the
Companys policy for each respective element.
The Company generates revenue primarily from sales of the following services:
Talent Solutions Talent Solutions revenue is derived primarily from providing access to the LinkedIn Recruiter product and job
postings. The Company provides access to its professional database of both active and passive job candidates with LinkedIn Recruiter,
which allows corporate recruiting teams to identify candidates based on industry, job function, geography, experience/education, and
other specifications. Revenue from providing access to the LinkedIn Recruiter product is recognized ratably over the subscription
period, which consists primarily of annual subscriptions that are billed monthly, quarterly, or annually. The Company also earns
revenue from the placement of job postings on its website, which generally run for 30 days. Independent recruiters can pay to post job
openings that are accessible through job searches or targeted job matches. Revenue from job postings is recognized as the posting is
displayed or the contract period, whichever is shorter.
Marketing Solutions The Company earns revenue from the display of advertisements (both graphic and text link) on its website
primarily based on a cost per advertisement model. Revenue from Internet advertising is generally recognized on a gross basis, with
the exception of transactions with advertising agencies, which are recognized net of agency discounts. The typical duration of the
Company's advertising contracts is approximately two months.
Premium Subscriptions The Company sells various subscriptions to customers that allow users to have further access to premium
services via its LinkedIn.com website. The Company offers its members monthly or annual subscriptions. Revenue from Premium
Subscription services is recognized ratably over the contractual period, generally from one to 12 months.

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Amounts billed or collected in excess of revenue recognized are included as deferred revenue. Sales tax is excluded from reported net
revenue. Although historical refunds have been minimal, the Company estimates allowances for each revenue type shown above based on
information available as of each balance sheet date. This information includes historical refunds as well as specific known service quality
issues. The Company records revenue for transactions in which it acts as an agent on a net basis, and revenue for transactions in which it acts as
a principal on a gross basis.
A majority of the Company's arrangements for Talent Solutions and Marketing Solutions include multiple deliverables. In accordance
with authoritative guidance on revenue recognition, the Company allocates consideration at the inception of an arrangement to all deliverables
based on the relative selling price method in accordance with the selling price hierarchy. The objective of the hierarchy is to determine the price
at which the Company would transact a sale if the service were sold on a stand-alone basis and requires the use of: (i) vendor-specific objective
evidence (VSOE) if available; (ii) third-party evidence (TPE) if VSOE is not available; and (iii) best estimate of selling price (BESP) if
neither VSOE nor TPE is available.
VSOE . The Company determines VSOE based on its historical pricing and discounting practices for the specific product or service when
sold separately. In determining VSOE, the Company requires that a substantial majority of the selling prices for these services fall within a
reasonably narrow pricing range.
The Company has not historically priced its Marketing Solutions within a narrow range to establish VSOE for such products. As a result,
the Company has established VSOE for a limited number of Talent Solutions products, and for such products, VSOE has been used to allocate
the selling price to deliverables.
TPE . When VSOE cannot be established for deliverables in multiple element arrangements, the Company applies judgment with respect
to whether it can establish a selling price based on TPE. TPE is determined based on competitor prices for similar deliverables when sold
separately. Generally, the Companys go-to-market strategy differs from that of its peers and its offerings contain a significant level of
differentiation such that the comparable pricing of services with similar functionality cannot be obtained. Furthermore, the Company is unable
to reliably determine what similar competitor services selling prices are on a stand-alone basis. As a result, the Company has not been able to
establish selling prices based on TPE.
BESP . When the Company is unable to establish selling prices using VSOE or TPE, the Company uses BESP in its allocation of
arrangement consideration. BESP is generally used to allocate the selling price to deliverables in the Companys multiple element
arrangements. The Company determines BESP for deliverables by considering multiple factors including, but not limited to, its pricing
practices, prices it charges for similar offerings, sales volume, geographies, market conditions, and the competitive landscape.
Advertising Costs
Advertising costs are expensed when incurred and are included in sales and marketing expense in the accompanying consolidated
statements of operations. The Company incurred advertising costs of $3.9 million , $3.6 million and $2.4 million for the years ended December
31, 2013 , 2012 and 2011 , respectively.
Stock-Based Compensation
Stock-based compensation expense is measured at the grant date based on the fair value of the award and is recognized on a straight-line
basis over the requisite service period of the award, which is generally four years. For further information, see Note 11, Stockholders' Equity .
Leases and Asset Retirement Obligations
The Company leases its office facilities and data centers under operating lease agreements. Office facilities subject to an operating lease
and the related lease payments are not recorded on the Companys balance sheet. The terms of certain lease agreements provide for increasing
rental payments; however, the Company recognizes rent expense on a straight-line basis over the lease period in accordance with authoritative
accounting guidance. Any lease incentives are recognized as reductions of rental expense on a straight-line basis over the term of the lease. The
lease term begins on the date of the initial possession of the leased property for purposes of recognizing lease expense.
The Company establishes assets and liabilities for the present value of estimated future costs to retire long-lived assets at the termination
or expiration of a lease. Such assets are depreciated over the lease period into operating expense, and the recorded liabilities are accreted to the
future value of the estimated retirement costs.
Rental expense, principally for leased office space and data centers under operating lease commitments, was $54.9 million , $30.7 million
and $10.1 million for the years ended December 31, 2013 , 2012 and 2011 , respectively.
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Income Taxes
The Company records income taxes using the asset and liability method which requires the recognition of deferred tax assets and
liabilities for the expected future tax consequences of events that have been recognized in the Companys consolidated financial statements or
tax returns. In estimating future tax consequences, generally all expected future events other than enactments or changes in the tax law or rates
are considered. Valuation allowances are provided when necessary to reduce deferred tax assets to the amount expected to be realized.
2.

Fair Value Measurements

The Company measures its cash equivalents, marketable securities and foreign currency derivative contracts at fair value based on an
expected exit price as defined by the authoritative guidance on fair value measurements, which represents the amount that would be received on
the sale of an asset or paid to transfer a liability, as the case may be, in an orderly transaction between market participants. As such, fair value
may be based on assumptions that market participants would use in pricing an asset or liability. The authoritative guidance on fair value
measurements establishes a consistent framework for measuring fair value on either a recurring or nonrecurring basis, whereby, inputs used in
valuation techniques are assigned a hierarchical level. The following are the hierarchical levels of inputs to measure fair value:
The Companys assets and liabilities that are measured at fair value on a recurring basis, by level, within the fair value hierarchy as of
December 31, 2013 and 2012 , are summarized as follows (in thousands):
December 31, 2013
Level 1

Level 2

Assets:
Cash equivalents:
Money market
funds
$ 242,712
Commercial paper

U.S. treasury
securities
318,495
U.S. agency
securities

Repurchase
agreements

Marketable securities:
Commercial paper

Certificates of
deposit

U.S. treasury
securities
149,908
U.S. agency
securities

Corporate debt
securities

Municipal securities

Other current assets:

Foreign currency
derivative contracts

Total assets
$ 711,115
Accrued liabilities:
Foreign currency
derivative contracts $
Total liabilities $

December 31, 2012

Level 3

15,698

Total

Level 1

Level 2

242,712
15,698

$ 148,384

Level 3

18,488

Total

$ 148,384
18,488

318,495

50,000

50,000

1,400

1,400

85,947

85,947

46,361

46,361

20,025

20,025

2,005

2,005

149,908

18,197

18,197

928,473

928,473

303,450

303,450

326,345
15,514

326,345
15,514

107,517
1,611

107,517
1,611

453
1,443,855

453
2,154,970

$ 166,581

146
$ 479,578

146
$ 646,159

$
$

1,129
1,129

$
$

$
$

1,129
1,129

$
$

$
$

$
$

$
$

1,040
1,040

1,040
1,040

The fair value of the Company's Level 1 financial instruments, which are traded in active markets, are based on quoted market prices for
identical instruments. The fair value of the Company's Level 2 fixed income securities are obtained from an independent pricing service, which
may use quoted market prices for identical or comparable instruments or model driven valuations using observable market data or inputs
corroborated by observable market data. The Company's procedures include controls to ensure that appropriate fair values are recorded,
including comparing the fair values obtained from the Company's

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pricing service against fair values obtained from other independent sources. The Company's derivative instruments are valued using pricing
models that use observable market inputs and, therefore, are classified as Level 2.
3.

Acquisitions and Joint Venture

Fiscal 2013 Joint Venture

On November 3, 2013, the Company entered into an agreement to create LinkedIn CN Limited, a joint venture (JV) with Dragon
Networking, an affiliate of China Broadband Capital, and SCCV IV Success HoldCo, Ltd., an affiliate of Sequoia Capital, (collectively, the
Partners) to engage in the investment, organization, management and operation of a professional social network in the Peoples Republic of
China (PRC). As of December 31, 2013 , the Company owned approximately 93% of the outstanding equity interests in the JV in the form of
common shares by contributing intellectual property. The Partners contributed $5.0 million in cash in exchange for 7% of the outstanding
equity interests in the form of preferred shares. Pending the occurrence of certain events, the Partners have the opportunity to contribute an
additional $20.0 million in cash in exchange for equity interests in the form of preferred shares (Second Closing), at which point the
Company and the Partners would own approximately 72% and 28% of the outstanding equity interests in the JV, respectively.
The preferred shares may be callable or puttable, generally at fair value, subject to a floor and cap, following the fifth anniversary of the
Second Closing or at the occurrence of certain events.
The Company has determined it is the primary beneficiary of the JV due to the percentage ownership as well as the power to direct the
activities that most significantly impact the JV's economic performance. Furthermore, the Company has the right to receive benefits and
obligation to absorb losses from the entity. The liabilities of the JV are recourse solely to JVs assets, except for as it relates to a guarantee
made by the Company to the JV in the event that the JV cannot fulfill the liability resulting from the exercise of the put right by the Partners.
The noncontrolling interest in the JV is classified outside of permanent equity in the Companys consolidated balance sheet as of
December 31, 2013 , as the preferred shares include a put right available to the noncontrolling interest holders in the future. Earnings
attributable to the noncontrolling interest on the Companys consolidated financial statements include the accretion to the redemption value and
were not material for any of the periods presented.
Fiscal 2013 Acquisition
On April 17, 2013, LinkedIn completed its acquisition of Alphonso Labs, Inc. ("Pulse"), a San Francisco, California-based privately held
leading mobile news reader and content distribution platform. LinkedIn's purchase price of $47.6 million for all the outstanding shares of
capital stock of Pulse consisted of $6.7 million in cash and 225,882 shares of LinkedIn Class A common stock. LinkedIn also issued 9,182
stock options related to assumed Pulse equity awards. The fair value of the earned portion of assumed stock options of $0.3 million is included
in the purchase price, with the remaining fair value of $1.2 million resulting in post-acquisition compensation expense that will be recognized
over the requisite service period of approximately three years from the date of acquisition.
The acquisition has been accounted for as a business combination under the acquisition method and, accordingly, the total purchase price
is allocated to the tangible and intangible assets acquired and the liabilities assumed based on their respective fair values on the acquisition
date. Pulse's results of operations have been included in the consolidated financial statements from the date of acquisition. To retain the services
of certain former Pulse employees, LinkedIn offered nonvested Class A common stock that will be earned over three years from the date of
acquisition. As these equity awards are subject to post-acquisition employment, the Company is accounting for them as post-acquisition
compensation expense. In connection with these post-acquisition arrangements, the Company issued 244,601 shares of nonvested Class A
common stock with a total fair value of $44.0 million .
The following table presents the purchase price allocation recorded in the Company's consolidated balance sheets on the acquisition date
(in thousands):
Total

Net tangible assets

Goodwill (1)
Intangible assets (2)
Net deferred tax liability
Total purchase consideration

_______________________
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221
35,657
14,000
(2,267)
47,611

Table of Contents

(1)
(2)

The goodwill represents the excess value over both tangible and intangible assets acquired and liabilities assumed. The goodwill in
this transaction is primarily attributable to expected operational synergies, the assembled workforce, and the future development
initiatives of the assembled workforce. None of the goodwill is expected to be deductible for tax purposes.
Identifiable definite-lived intangible assets were comprised of developed technology of $9.5 million , trade name of $2.7 million ,
registered user base of $1.2 million and backlog of $0.6 million . The overall weighted-average life of the identifiable definite-lived
intangible assets acquired was 2.9 years, which will be amortized on a straight-line basis over their estimated useful lives.

Pro forma results of operations for this acquisition have not been presented as the financial impact to the Companys consolidated
financial statements is not material.
Fiscal 2012 Acquisitions
Slideshare
On May 17, 2012, LinkedIn completed its acquisition of Slideshare, Inc. (Slideshare), a San Francisco, California-based privately held
provider of a professional and educational content platform that allows users to upload documents to share ideas, conduct research, connect
with others, and generate leads for their businesses. LinkedIns purchase price of $74.1 million for all the outstanding shares of capital stock of
Slideshare consisted of approximately $32.2 million paid in cash consideration and 375,956 shares of LinkedIn Class A common stock.
LinkedIn also issued 82,108 stock options and 14,146 restricted stock units (RSUs) related to assumed Slideshare equity awards. The fair
value of the earned portion of assumed stock options and RSUs of $2.4 million is included in the purchase price, with the remaining fair value
of $6.9 million resulting in post-acquisition compensation expense that will generally be recognized ratably over two years from the date of
acquisition.
The acquisition has been accounted for under the acquisition method, and, accordingly, the total purchase price has been allocated to the
tangible and intangible assets acquired and the liabilities assumed based on their respective fair values on the acquisition date. Slideshares
results of operations have been included in the consolidated financial statements from the date of acquisition. To retain the services of certain
former Slideshare employees, LinkedIn offered nonvested Class A common stock and cash bonuses that will be earned in equal semi-annual
installments over two years from the date of acquisition. As these equity awards and payments are subject to post-acquisition employment, the
Company is accounting for these arrangements as post-acquisition compensation expense . In connection with these post-acquisition
arrangements, the Company issued 198,915 shares of nonvested Class A common stock with a total fair value of $20.9 million and could pay
remaining retention bonuses up to $4.3 million as of December 31, 2013 .
Other acquisitions
In 2012 , the Company completed five other acquisitions for total cash consideration of approximately $28.3 million and 297,515 shares
of LinkedIn Class A common stock. The total purchase price of these acquisitions, of which two were accounted for as the purchase of an asset
and the others as purchases of businesses under the acquisition method, has been allocated to the tangible and identifiable intangible assets
acquired and the net liabilities assumed based on their respective fair values on the acquisition dates.
The following table presents the purchase price allocations initially recorded in the Companys consolidated balance sheets on the
respective acquisition dates (in thousands):
Other
Acquisitions

Slideshare

Net tangible assets (liabilities)

Goodwill (1)
Intangible assets (2)
Deferred tax liability
Total purchase consideration

3,234
62,420
12,800
(4,369)
74,085

(456)
40,545
21,642
(4,984)
56,747

Total

2,778
102,965
34,442
(9,353)
130,832

_______________________
(1)
The goodwill represents the excess value over both tangible and intangible assets acquired. The goodwill in these transactions is
primarily attributable to expected operational synergies, the assembled workforces, and the future development initiatives of the
assembled workforces. None of the goodwill is expected to be deductible for tax purposes.
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(2)

Identifiable definite-lived intangible assets were comprised of developed technology of $24.3 million , trade name of $4.3 million ,
patents of $3.4 million , customer relationships of $1.2 million , non-compete agreements of $0.4 million and other intangible assets
of $0.8 million . The overall weighted-average life of the identifiable definite-lived intangible assets acquired in the purchase of the
companies was 4.5 years , which will be amortized on a straight-line basis over their estimated useful lives.

The Companys consolidated financial statements include the operating results of all acquired businesses from the date of each
acquisition. Pro forma results of operations for all of these acquisitions have not been presented as the financial impact to the Companys
consolidated financial statements, both individually and in aggregate, are not material.
Fiscal 2011 Acquisitions
In 2011, the Company completed its acquisition of three companies for total consideration of approximately $17.9 million , of which $9.8
million was paid in cash and $8.1 million was issued in shares of the Companys Class A common stock. These acquisitions have been
accounted for under the acquisition method, and, accordingly, the total purchase price has been allocated to the tangible and identifiable
intangible assets acquired and the net liabilities assumed based on their respective fair values on the acquisition date. As a result of these
acquisitions, the Company recorded goodwill in the amount of $12.2 million , identifiable definite-lived intangible assets of $6.2 million ,
which was comprised of $4.4 million related to developed technology and $1.8 million related to non-compete agreements, and net liabilities of
$0.9 million . The overall weighted-average life of the identifiable definite-lived intangible assets acquired in the purchase of the companies
was 4.2 years , which will be amortized on a straight-line basis over their estimated useful lives. The Companys consolidated financial
statements include the operating results of all acquired businesses from the date of each acquisition. Pro forma results of operations for these
acquisitions have not been presented as the financial impact to the Companys consolidated financial statements, both individually and in
aggregate, are not material.

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4.

Cash and Investments

The following table presents cash, cash equivalents and available-for-sale investments for the periods presented (in thousands):
Gross
Unrealized
Gains

Amortized
Cost

December 31, 2013:

Cash
$
Cash equivalents:
Money market funds
Commercial paper
U.S. treasury securities
U.S. agency securities
Repurchase agreements
Marketable securities:
Commercial paper
Certificates of deposit
U.S. treasury securities
U.S. agency securities
Corporate debt securities
Municipal securities
Total cash, cash equivalents, and
marketable securities
$
December 31, 2012:
Cash
$
Cash equivalents:
Money market funds
Commercial paper
Marketable securities:
Commercial paper
Certificates of deposit
U.S. treasury securities
U.S. agency securities
Corporate debt securities
Municipal securities
Total cash, cash equivalents, and
marketable securities
$

174,784

Gross
Unrealized
Losses

Estimated
Fair Market
Value

174,784

242,712
15,696
318,500
50,000
1,400

(5)

242,712
15,698
318,495
50,000
1,400

85,930
20,025
149,845
928,371
326,027
15,504

18
2
67
410
399
14

(1)
(2)
(4)
(308)
(81)
(4)

85,947
20,025
149,908
928,473
326,345
15,514

2,328,794

912

(405)

2,329,301

103,536

103,536

148,384
18,487

148,384
18,488

46,352
2,000
18,184
302,991
107,585
1,612

9
5
13
460
10

(1)
(78)
(1)

46,361
2,005
18,197
303,450
107,517
1,611

749,131

498

(80)

749,549

The following table presents available-for-sale investments by contractual maturity date as of December 31, 2013 (in thousands):
Estimated
Fair Market
Value

Amortized
Cost

Due in one year or less

Due after one year through two years
Total

$
$

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723,319
802,383
1,525,702

$
$

723,512
802,700
1,526,212

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5.

Property and Equipment

The following table presents the detail of property and equipment, net, for the periods presented (in thousands):
December 31,
2013

Computer equipment
Software
Capitalized website and internal-use software
Furniture and fixtures
Leasehold improvements
Total
Less accumulated depreciation and amortization
Property and equipment, net

6.

2012

347,545
32,103
80,074
28,786
116,887
605,395
(243,654)
361,741

199,022
26,901
40,971
17,087
44,362
328,343
(141,666)
186,677

Goodwill and Other Intangible Assets

Goodwill
The following table presents the goodwill activity for the periods presented (in thousands):

GoodwillDecember 31, 2011

2012 acquisitions
GoodwillDecember 31, 2012
2013 acquisition
GoodwillDecember 31, 2013

$
$
$

12,249
102,965
115,214
35,657
150,871

Other Intangible Assets

The following table presents the detail of other intangible assets for the periods presented (dollars in thousands):

Gross
Carrying
Amount

December 31, 2013:

Developed technology
Trade name
Patents
Customer relationships
Other intangible assets
Total
December 31, 2012:
Developed technology
Trade name
Patents
Customer relationships
Other intangible assets
Total

$
$

Net
Carrying
Amount

Accumulated
Amortization

37,452
7,000
16,398
1,200
6,705
68,755

30,952
4,300
4,025
1,200
6,837
47,314

(16,340)
(2,869)
(1,261)
(380)
(4,859)
(25,709)

(7,676)
(836)
(750)
(140)
(5,132)
(14,534)

WeightedAverage
Remaining
Life

21,112
4,131
15,137
820
1,846
43,046

2.2 years
1.9 years
11.1 years
3.4 years
2.0 years
5.4 years

23,276
3,464
3,275
1,060
1,705
32,780

3.2 years
2.4 years
13.5 years
4.4 years
1.6 years
4.1 years

During the year ended December 31, 2013 , the Company purchased patents for $12.4 million with a weighted-average life of 10.8 years.
Amortization expense for the years ended December 31, 2013 , 2012 and 2011 was $16.4 million , $9.9 million and $3.6 million ,
respectively. Estimated future amortization of purchased intangible assets for future periods is as follows (in thousands):

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Years Ending December 31,

2014
2015
2016
2017
2018
Thereafter
Total

7.

14,938
12,031
4,924
1,601
1,501
7,635
42,630

Accrued Liabilities
The following table presents the detail of accrued liabilities for the periods presented (in thousands):
December 31,
2013

Accrued vacation and employee-related expenses

Accrued incentives
Accrued commissions
Accrued sales tax and value-added taxes
Other accrued expenses
Total

8.

2012

64,757
60,081
32,218
10,851
15,097
183,004

35,803
31,174
15,380
9,103
12,617
104,077

Other Income (Expense), Net

The following table presents the detail of other income (expense), net, for the periods presented (in thousands):
Year Ended December 31,
2013

Interest income
$
Net loss on foreign exchange and foreign currency derivative contracts
Net realized gain on sales of marketable securities
Other non-operating income (expense), net
Total other income (expense), net
$
9.

2012

2,895
(1,626)
127
20
1,416

2011

1,025
(672)
60
(161)
252

169
(2,965)
6
(113)
(2,903)

Income Per Share

Basic and diluted net income per common share is presented in conformity with the two-class method required for participating
securities.
Immediately prior to the consummation of the Companys initial public offering ("IPO") of its Class A common stock in May 2011, all
outstanding shares of preferred stock and common stock were converted to Class B common stock. As a result, Class A and Class B common
stock are the only outstanding equity in the Company. The rights of the holders of Class A and Class B common stock are identical, except with
respect to voting and conversion. Each share of Class A common stock is entitled to one vote per share and each share of Class B common
stock is entitled to ten votes per share . Shares of Class B common stock may be converted into Class A common stock at any time at the option
of the stockholder, and are automatically converted upon sale or transfer to Class A common stock, subject to certain limited exceptions.
Basic net income per share is computed using the weighted-average number of common shares outstanding during the period. Diluted net
income per share is computed using the weighted-average number of common shares and, if dilutive, potential common shares outstanding
during the period. The Companys potential common shares consist of the incremental common shares issuable upon the exercise of stock
options, and to a lesser extent, shares issuable upon the release of RSUs and purchases related to the 2011 Employee Stock Purchase Plan. The
dilutive effect of these potential common shares is reflected
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in diluted earnings per share by application of the treasury stock method. The computation of the diluted net income per share of Class A
common stock assumes the conversion of Class B common stock, while the diluted net income per share of Class B common stock does not
assume the conversion of Class A common stock as Class A common stock is not convertible into Class B common stock.
The undistributed earnings are allocated based on the contractual participation rights of the Class A and Class B common shares as if the
earnings for the year have been distributed. As the liquidation and dividend rights are identical, the undistributed earnings are allocated on a
proportionate basis. Further, as the conversion of Class B common stock is assumed in the computation of the diluted net income per share of
Class A common stock, the undistributed earnings are equal to net income for that computation.
The following table presents the calculation of basic and diluted net income per share (in thousands, except per share data):
Year Ended December 31,
2013

2012

Class A

Basic net income per share:

Numerator:
Allocation of undistributed earnings
$
Denominator:
Weighted-average common shares outstanding
Basic net income per share
$
Diluted net income per share:
Numerator:
Allocation of undistributed earnings for basic
computation
$
Reallocation of undistributed earnings as a
result of conversion of Class B to Class A
shares
Reallocation of undistributed earnings to Class
B shares
Allocation of undistributed earnings
$

22,443

Class B

4,326

95,282
0.24

22,443

2011

Class A

Class B

14,735

18,361
0.24

71,711
0.21

4,326

14,735

6,874

Class A

Class B

1,420

$ 10,492

33,455
$
0.21

9,200
0.15

67,985
$
0.15

1,420

$ 10,492

6,874

4,326

6,874

10,492

26,769

713
5,039

21,609

902
7,776

$ 11,912

364
$ 10,856

Denominator:
Number of shares used in basic calculation
95,282
Weighted-average effect of dilutive securities
Add:
Conversion of preferred stock in connection
with initial public offering

Conversion of Class B to Class A common

shares outstanding
18,361
Employee stock options
4,128
RSUs and other dilutive securities
1,173
Number of shares used in diluted
calculation
118,944
Diluted net income per share
$
0.23

18,361

71,711

33,455

9,200

67,985

17,133

4,025

33,455
7,288
390

7,151

85,118
9,770
30

9,770

22,386
0.23

112,844
$
0.19

40,606
$
0.19

104,118
$
0.11

94,888
$
0.11

The following weighted-average employee equity awards were excluded from the calculation of diluted net income per share because
their effect would have been anti-dilutive for the periods presented (in thousands):
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Year Ended December 31,

2013

Employee stock options

RSUs
Total
10.

2012

588
162
750

2011

28
36
64

418
88
506

Commitments and Contingencies

Aggregate Future Lease Commitments

The Company leases its office facilities and data centers under operating lease agreements, the longest of which is expected to expire in
2026 . The Companys future minimum payments, which exclude operating expenses, under non-cancelable operating leases for office facilities
and data centers having initial terms in excess of one year as of December 31, 2013 , are as follows (in thousands):
Operating
Leases (1)

Year Ending December 31,

2014
2015
2016
2017
2018
Thereafter
Total minimum lease payments

71,126
95,992
96,945
92,853
83,161
525,291
965,368

(1) Subsequent to December 31, 2013 , the Company leased additional space in New York, New York. The lease
expires in 2026 and aggregate future minimum lease payments for this facility are approximately $25.6 million .
Legal Proceedings
The Company is subject to legal proceedings and litigation arising in the ordinary course of business, including, but not limited to, certain
pending patent and privacy matters, including class action lawsuits, as well as inquiries, investigations, audits and other regulatory proceedings.
Although occasional adverse decisions or settlements may occur, the Company does not believe that the final disposition of any of these
matters will have a material adverse effect on the business. Certain of these matters include speculative claims for substantial or indeterminate
amounts of damages, and include claims for injunctive relief. Additionally, the Company's litigation costs are significant. Other regulatory
matters could result in fines and penalties being assessed against the Company, and it may become subject to mandatory periodic audits, which
would likely increase its regulatory compliance costs. Adverse results of litigation or regulatory matters could also result in the Company being
required to change its business practices, which could negatively impact its membership and revenue growth.
The Company records a liability when it believes that it is both probable that a loss has been incurred and the amount can be reasonably
estimated. The Company periodically evaluates developments in its legal matters that could affect the amount of liability that it has previously
accrued, if any, and makes adjustments as appropriate. Significant judgment is required to determine both likelihood of there being, and the
estimated amount of, a loss related to such matters, and the Companys judgment may be incorrect. The outcome of any proceeding is not
determinable in advance. Until the final resolution of any such matters that the Company may be required to accrue for, it may be exposed to
loss in excess of the amount accrued, and such amounts could be material.
Indemnifications
In the ordinary course of business, the Company enters into contractual arrangements under which it agrees to provide indemnification of
varying scope and terms to business partners and other parties with respect to certain matters, including, but not limited to, losses arising out of
the Companys breach of such agreements and out of intellectual property infringement claims made by third parties. In these circumstances,
payment may be conditional on the other party making a claim pursuant to the procedures specified in the particular contract. Further, the
Companys obligations under these agreements may be limited in terms of time and/or amount, and in some instances, it may have recourse
against third parties for certain payments. In addition, the Company has indemnification agreements with certain of its directors and executive
officers that require it, among other things, to indemnify them against certain liabilities that may arise by reason of their status or service as
directors or officers with the Company. The terms of such obligations may vary.
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11.

Stockholders Equity
Initial Public Offering

In May 2011, the Company closed its IPO of 9,016,000 shares of its Class A common stock, which included 6,003,804 shares of Class A
common stock sold by the Company (inclusive of 1,176,000 shares of Class A common stock from the full exercise of the overallotment option
of shares granted to the underwriters) and 3,012,196 shares of Class A common stock sold by the selling stockholders. The public offering price
of the shares sold in the offering was $45.00 per share. The Company did not receive any proceeds from the sales of shares by the selling
stockholders. The total gross proceeds from the offering to the Company were $270.2 million . After deducting underwriting discounts and
commissions and offering expenses payable by the Company, the aggregate net proceeds received by the Company totaled approximately
$248.4 million .
Follow-on Offerings
In November 2011, the Company closed a follow-on offering of 10,062,500 shares of its Class A common stock, which included
2,583,755 shares of Class A common stock sold by the Company (inclusive of 1,312,500 shares of Class A common stock from the full
exercise of the overallotment option of shares granted to the underwriters) and 7,478,745 shares of Class A common stock sold by the selling
stockholders. The public offering price of the shares sold in the offering was $71.00 per share. The Company did not receive any proceeds from
the sales of shares by the selling stockholders. The total gross proceeds from the offering to the Company were $178.1 million . After deducting
underwriting discounts and commissions and offering expenses payable by the Company, the aggregate net proceeds received by the Company
totaled approximately $177.3 million .
In September 2013, the Company closed a follow-on offering, at which time it sold a total of 6,188,340 shares of its Class A common
stock (inclusive of 807,174 shares from the full exercise of the over-allotment option granted to the underwriters). The public offering price of
the shares sold in the offering was $223.00 per share. The total gross proceeds from the offering to the Company were $1,380.0 million . After
deducting underwriting discounts and commissions and offering expenses payable by the Company, the aggregate net proceeds received by the
Company totaled approximately $1,348.1 million .
Preferred Stock
Prior to its IPO, the Company had outstanding 17,238,579 shares designated as Series A convertible preferred stock, 17,450,991 shares
designated as Series B convertible preferred stock, 4,357,644 designated as Series C redeemable convertible preferred stock and 6,599,987
designated as Series D redeemable convertible preferred stock. Each share of preferred stock was convertible into one share of common stock.
Immediately prior to the completion of the Companys IPO on May 19, 2011, all shares of outstanding preferred stock automatically converted
into 45,647,201 shares of the Companys Class B common stock. After its IPO, the Company had 100,000,000 shares of preferred stock
authorized, none of which were issued and outstanding as of December 31, 2013 and 2012 .
Common Stock
Following its IPO, the Company had two classes of authorized common stock outstanding; Class A common stock and Class B common
stock at a maximum aggregate number authorized of 1,000,000,000 and 120,000,000 , respectively. As of December 31, 2013 , the Company
had outstanding 103,194,534 shares of Class A common stock and 17,157,215 shares of Class B common stock. The rights of the holders of
Class A and Class B common stock are identical, except with respect to voting and conversion. Each share of Class A common stock is entitled
to one vote per share and each share of Class B common stock is entitled to ten votes per share. Shares of Class B common stock may be
converted into Class A common stock at any time at the option of the stockholder, and are automatically converted upon sale or transfer to
Class A common stock, subject to certain limited exceptions. After its IPO, the Company had an additional 1,000,000,000 shares of common
stock authorized, none of which were issued and outstanding as of December 31, 2013 and 2012 .
Common Stock Reserved for Future Issuance
As of December 31, 2013 , the Company had reserved shares of common stock for future issuances in connection with the following:
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Options outstanding
RSUs outstanding
Available for future stock option and restricted stock unit grants
Available for future employee stock purchase plan options
Total reserved for future issuance

5,130,636
4,048,089
8,542,023
2,884,896
20,605,644

Equity Incentive Plans

The Company has two equity incentive plans: the Amended and Restated 2003 Stock Incentive Plan (the 2003 Plan) and the 2011
Equity Incentive Plan (the 2011 Plan and together with the 2003 Plan, the "Equity Plans"). As of December 31, 2013 , a total of 50,814,756
shares of common stock were reserved for the issuance of equity awards under the Equity Plans. Upon the Company's IPO in 2011, the 2003
Plan was terminated and all shares that remained available for future issuance under the 2003 Plan at the time of its termination were
transferred to the 2011 Plan. No further equity awards can be granted under the 2003 Plan. As of December 31, 2013 , 4,154,143 options to
purchase common stock granted under the 2003 Plan remain outstanding. Any of these shares that expire, are forfeited, are repurchased by the
Company or are otherwise terminated will become available under the 2011 Plan. As of December 31, 2013 , the total number of shares
available for future grants under the 2011 Plan is 8,542,023 shares, including shares transferred from the 2003 Plan.
Under the 2011 Plan, the Company has the ability to issue incentive stock options ("ISOs"), nonstatutory stock options ("NSOs"), stock
appreciation rights, restricted stock, RSUs, performance units and/or performance shares. The ISOs and NSOs will be granted at a price per
share not less than the fair value at date of grant. Options granted to date generally vest over a four -year period with 25% vesting at the end of
one year and the remainder vesting monthly thereafter. Options granted generally are exercisable up to ten years. The Company began granting
RSUs in June 2011, which generally vest over a four -year period with 25% vesting at the end of one year and the remainder vesting quarterly
thereafter.
Employee Stock Purchase Plan
Concurrent with the effectiveness of the Companys registration statement on Form S-1 on May 18, 2011, the Companys 2011 Employee
Stock Purchase Plan (the ESPP) became effective. The ESPP allows eligible employees to purchase shares of the Companys Class A
common stock at a discount through payroll deductions of up to 10% of their eligible compensation, subject to any plan limitations. The ESPP
provides for six -month offering periods, and at the end of each offering period, employees are able to purchase shares at 85% of the lower of
the fair market value of the Companys Class A common stock on the first trading day of the offering period or on the last day of the offering
period. As of December 31, 2013 , a total of 3,500,000 shares of common stock were reserved for the issuance of equity awards under the
ESPP.
Employees purchased 217,743 shares of common stock at an average exercise price of $112.93 in fiscal 2013 . As of December 31,
2013 , approximately 2,884,896 shares remained available for future issuance.
Stock Option Activity
A summary of stock option activity for the year ended December 31, 2013 is as follows:

Options Outstanding
WeightedNumber of
Average
Shares
Exercise Price

OutstandingDecember 31, 2012

Assumed options from acquisition
Granted
Exercised
Canceled or expired
OutstandingDecember 31, 2013

8,251,850
9,182
734,641
(3,659,817)
(205,220)
5,130,636

Options vested and expected to vest as of

December 31, 2013
Options vested and exercisable as of December 31,
2013

WeightedAverage
Remaining
Contractual
Term
(in years)

Aggregate
Intrinsic
Value
(in thousands)

10.50
14.50
172.02
8.97
15.10
34.54

6.57

935,583

4,951,636

31.72

6.50

916,869

2,995,579

10.94

5.75

616,750

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Aggregate intrinsic value represents the difference between the Companys closing stock price of its common stock and the exercise price
of outstanding, in-the-money options. The Companys closing stock price as reported on the New York Stock Exchange as of December 31,
2013 was $216.83 . The total intrinsic value of options exercised was approximately $655.9 million , $553.5 million and $177.5 million for the
years ended December 31, 2013 , 2012 and 2011 , respectively. As of December 31, 2013 , total unrecognized compensation cost, adjusted for
estimated forfeitures, related to nonvested stock options was approximately $57.0 million , which is expected to be recognized over the next
1.86 years .
The following table summarizes information about outstanding and vested stock options as of December 31, 2013 :

Exercise Price

$0.06 - $2.00
$2.32
$3.00 - $6.20
$6.80 - $14.46
$14.50
$19.63
$20.00
$22.59
$45.00 - $161.34
$170.46 - $233.64

Numbers of
Shares
Outstanding

45,240
1,809,944
525,556
524,296
5,740
635,070
8,126
589,955
306,394
680,315
5,130,636

Options Outstanding
Weighted
Average
Remaining
Contractual
Life (Years)

3.76
5.13
6.08
6.82
8.64
7.13
4.30
7.27
7.56
9.17
6.57

Options Vested and Exercisable

Weighted Average
Exercise Price

1.27
2.32
5.09
10.06
14.50
19.63
20.00
22.59
69.85
172.83
34.54

Number of
Shares

44,505
1,809,944
385,382
224,560
962
162,832
3,250
204,481
91,154
68,509
2,995,579

Weighted Average
Exercise Price

1.29
2.32
4.77
10.01
14.50
19.63
20.00
22.59
53.03
170.98
10.94

RSU Activity
A summary of RSU activity for the year ended December 31, 2013 , is as follows:
WeightedAverage
Grant Date
Fair Value

Number of
Shares

UnvestedDecember 31, 2012

Granted
Released
Canceled or expired
UnvestedDecember 31, 2013

3,239,272
2,313,018
(1,154,252)
(349,949)
4,048,089

94.69
189.75
103.51
117.43
144.53

As of December 31, 2013 , total unrecognized compensation cost, adjusted for estimated forfeitures, related to RSUs was approximately
$450.1 million , which is expected to be recognized over the next 2.93 years .
Restricted Stock
In connection with Pulse, Slideshare and other acquisitions, the Company issued restricted stock. As of December 31, 2013 , the total
unrecognized compensation cost related to restricted stock was approximately $39.7 million , which is expected to be recognized over the next
2.42 years .
Stock-Based Compensation Expense
The fair value of options granted to employees is estimated on the grant date using the Black-Scholes option valuation model. This
valuation model for stock-based compensation expense requires the Company to make assumptions and judgments about the variables used in
the calculation, including the fair value of the Companys common stock, the expected term (the period of time that the options granted are
expected to be outstanding), the volatility of the Companys common stock, a risk-free interest rate, and expected dividends. The Company also
estimates forfeitures of unvested stock options. To the extent actual forfeitures differ from the estimates, the difference will be recorded as a
cumulative adjustment in the period estimates

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are revised. No compensation cost is recorded for options that do not vest. The Company uses the simplified calculation of expected life
described in the SECs Staff Accounting Bulletin No. 107, Share-Based Payment , and volatility for stock options is based on an average of the
historical volatilities of the common stock of several entities with characteristics similar to those of the Company. The Company will continue
to use the simplified method until it has sufficient historical exercise data to estimate the expected life of the options. The volatility for ESPP is
based on the historical volatility of the Company's common stock. The risk-free rate is based on the U.S. Treasury yield curve in effect at the
time of grant for periods corresponding with the expected life of the option. The Company uses an expected dividend yield of zero as it does
not anticipate paying any dividends in the foreseeable future. Expected forfeitures are based on the Companys historical experience.
The following table presents the weighted-average assumptions used to estimate the fair value of options granted during the periods
presented, excluding assumed acquisition-related stock options:
Year Ended December 31,
2013

Volatility
Expected dividend yield
Risk-free rate
Expected term (in years)

2012

54%

1.15%
6.27

2011

54%

0.95%
6.08

55%

2.58%
6.07

The weighted-average grant date fair value of options granted, excluding assumed acquisition-related stock options was $89.13 , $51.76
and $13.28 for the years ended December 31, 2013 , 2012 and 2011 , respectively. The weighted-average grant date fair value of assumed
acquisition-related stock options during the year ended December 31, 2013 was $166.08 .
The following table presents the weighted-average assumptions used to estimate the fair value of the ESPP during the periods presented:
Year Ended December 31,
2013

Volatility
Expected dividend yield
Risk-free rate
Expected term (in years)

2012

42%

0.10%
0.50

2011

48%

0.14%
0.50

75%

0.06%
0.50

The following table presents the amount of stock-based compensation related to stock-based awards to employees on the Companys
consolidated statements of operations during the periods presented (in thousands):
Year Ended December 31,
2013

Cost of revenue
Sales and marketing
Product development
General and administrative
Total stock-based compensation
Tax benefit from stock-based compensation
Total stock-based compensation, net of tax effect

15,600
36,187
98,861
43,267
193,915
(52,559)
141,356

2012

6,416
17,726
46,026
16,151
86,319
(20,395)
65,924

2011

1,678
8,074
13,625
6,391
29,768
(4,679)
25,089

During the years ended December 31, 2013 , 2012 and 2011 , the Company capitalized $9.2 million , $3.4 million and $0.5 million ,
respectively, of stock-based compensation as website development costs. Management modified or accelerated the vesting terms for certain
employee options, which resulted in an additional $ 1.3 million , $3.0 million and $1.4 million of stock-based compensation expense for the
years ended December 31, 2013 , 2012 and 2011 , respectively.
12.

Income Taxes

The Company accounts for income taxes in accordance with authoritative guidance, which requires the use of the asset and liability
method. Under this method, deferred income tax assets and liabilities are determined based upon the difference
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between the consolidated financial statement carrying amounts and the tax basis of assets and liabilities and are measured using the enacted tax
rate expected to apply to taxable income in the years in which the differences are expected to be reversed.
The following table presents domestic and foreign components of income before income taxes for the periods presented (in thousands):
Year Ended December 31,
2013

Domestic
Foreign
Total

$
$

2012

145,421
(96,193)
49,228

$
$

2011

110,535
(53,421)
57,114

$
$

28,945
(6,003)
22,942

The following table presents the components of the provision for income taxes for the periods presented (in thousands):
Year Ended December 31,
2013

Current:
Federal
State
Foreign
Total current
Deferred:
Federal
State
Foreign
Total deferred
Total provision

2012

35,754
5,513
10,358
51,625
(25,469)
(2,579)
(1,118)
(29,166)
22,459

2011

30,919
3,452
4,390
38,761
(395)
(2,629)
(233)
(3,257)
35,504

11
204
1,307
1,522
8,258
726
524
9,508
11,030

The following table presents a reconciliation of the statutory federal rate and the Companys effective tax rate for the periods presented:
Year Ended December 31,
2013

U.S. federal taxes at statutory rate

State income taxes, net of federal benefit
Foreign rate differential
Permanent differences
Stock-based compensation
Change in valuation allowance
Research and development credits
Transaction-related expenses
Other
Total

2012

35 %
4
36
1
5

(56)
23
(2)
46 %

2011

35 %
2
12
1
3
(2)

11

62 %

35 %
(12)
11
4
11
17
(21)
1
2
48 %

On January 2, 2013, the President signed into law The American Taxpayer Relief Act of 2012 (the "2012 Act"). Under prior law, a
taxpayer was entitled to a research tax credit for qualifying amounts paid or incurred on or before December 31, 2011. The 2012 Act extends
the research credit for two years to December 31, 2013. The extension of the research credit is retroactive and includes amounts paid or
incurred after December 31, 2011. As a result of the retroactive extension, the Company recognized a tax benefit of $15.5 million in the twelve
months ended December 31, 2013 for qualifying amounts incurred in 2012 .
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Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for income tax purposes. The following table presents the significant components of the
Companys deferred tax assets and liabilities for the periods presented (in thousands):
December 31,
2013

Deferred tax assets:

Accruals and reserves
Net operating loss carryforwards
Tax credit carryforwards
Stock-based compensation
Other
Total deferred tax assets
Less valuation allowance
Net deferred tax assets
Deferred tax liability:
Prepaid expenses
Intangible assets
Depreciation
Other
Total deferred tax liabilities
Total net deferred tax assets (liabilities)

2012

34,801
2,129
23,917
22,030
1,298
84,175
(27,302)
56,873
(3,485)
(4,905)
(30,444)
(677)
(39,511)
17,362

19,531
1,707
12,405
12,107
1,407
47,157
(15,201)
31,956
(1,974)
(7,518)
(38,206)
(282)
(47,980)
(16,024)

Realization of deferred tax assets is dependent upon the generation of future taxable income, if any, the timing and amount of which are
uncertain. Due to the history of losses the Company has generated in the past in certain jurisdictions, the Company believes that it is more
likely than not that California and certain international deferred tax assets will not be realized as of December 31, 2013 . Accordingly, the
Company has recorded a valuation allowance on such deferred tax assets. The valuation allowance increased by $12.1 million and $8.8 million
during the year ended December 31, 2013 and 2012 , respectively. There are no material decreases in valuation allowance in other jurisdictions
and the increase in valuation allowance for 2013 is primarily related to California research and development credits.
Pursuant to authoritative guidance, the benefit of stock options will only be recorded to stockholders equity when cash taxes payable is
reduced. As of December 31, 2013 , the portion of net operating loss carryforwards and credit carryforwards related to stock options is
approximately $366.3 million tax-effected. This amount will be credited to stockholders' equity when it is realized on the tax return.
As of December 31, 2013 , the Company had net operating loss carryforwards for federal income tax return purposes of approximately
$870.4 million , which expire at various dates beginning in the year 2023 , if not utilized. The Company had net operating loss carryforwards of
approximately $551.8 million for California income tax return purposes and approximately $571.9 million for other state income tax return
purposes which expire at various dates beginning in the year 2013 , if not utilized.
As of December 31, 2013 , the Company had research and development credit carryforwards for federal income tax return purposes of
approximately $57.0 million , which expire at various dates beginning in the year 2023 , if not utilized. The Company had research and
development credit carryforwards for state income tax return purposes of approximately $48.3 million , which can be carried forward
indefinitely.
Utilization of the net operating loss carryforwards and credits may be subject to a substantial annual limitation due to the ownership
change limitations provided by the Internal Revenue Code of 1986, as amended and similar state provisions. The annual limitation may result
in the expiration of net operating losses and credits before utilization. The Company believes an ownership change, as defined under
Section 382 of the Internal Revenue Code, existed in prior years, and has reduced its net operating loss carryforwards to reflect the limitation.
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As of December 31, 2013 , the Company had approximately $43.7 million in total unrecognized tax benefits. A reconciliation of the
beginning and ending amount of unrecognized tax benefits is as follows (in thousands):
Year Ended December 31,
2013

Unrecognized tax benefits balance at January 1

Gross increase for tax positions of prior years
Gross increase for tax positions of current year
Gross unrecognized tax benefits at December 31

2012

19,344
9,482
14,909
43,735

10,657
1,538
7,149
19,344

If the $43.7 million of unrecognized tax benefits as of December 31, 2013 is recognized, approximately $25.3 million would decrease the
effective tax rate in the period in which each of the benefits is recognized. If the $19.3 million of unrecognized tax benefits as of December 31,
2012 is recognized, approximately $8.3 million would decrease the effective tax rate in the period in which each of the benefits is recognized.
The remaining amount would be offset by the reversal of related deferred tax assets on which a valuation allowance is placed. The Company
does not expect any material changes to its unrecognized tax benefits within the next twelve months.
The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. As of December 31, 2013 and
2012 , penalties and interest were immaterial.
The Company files income tax returns in the U.S. federal jurisdiction as well as many U.S. states and foreign jurisdictions. The tax years
2003 to 2011 remain open to examination by the major jurisdictions in which the Company is subject to tax. Fiscal years outside the normal
statute of limitation remain open to audit by tax authorities due to tax attributes generated in those early years which have been carried forward
and may be audited in subsequent years when utilized. The Company is currently under audit by the Internal Revenue Service (IRS) for the
2010 and 2011 tax years. The Company is subject to the continuous examination of income tax returns by various tax authorities. The Company
regularly assesses the likelihood of adverse outcomes resulting from these examinations to determine the adequacy of the provision for income
taxes. The Company believes that adequate amounts have been reserved for any adjustments that may ultimately result from these examinations
and does not anticipate a significant impact to the gross unrecognized tax benefits within the next 12 months related to these years.
The Company attributes net revenue and costs and expenses to domestic and foreign components based on the terms of its agreements
with its subsidiaries. The Company does not provide for federal income taxes on the undistributed earnings of its foreign subsidiaries, as such
earnings are to be reinvested offshore indefinitely. The income tax liability would be insignificant if these earnings were to be repatriated.
13.

Information About Revenue and Geographic Areas

The Company considers operating segments to be components of the Company in which separate financial information is available that is
evaluated regularly by the Companys chief operating decision maker in deciding how to allocate resources and in assessing performance. The
chief operating decision maker for the Company is the Chief Executive Officer. The Chief Executive Officer reviews financial information
presented on a consolidated basis, accompanied by information about revenue by product line, sales channel, and geographic region for
purposes of allocating resources and evaluating financial performance. Accordingly, the Company has determined that it has one operating
segment, and therefore, one reportable segment.
Revenue by geography is generally based on the shipping address of the customer. The following tables present the Companys revenue
by product line, as well as revenue and long-lived assets by geographic region for the periods presented (in thousands):
Year Ended December 31,
2013

Net revenue by product:

Talent Solutions
Marketing Solutions
Premium Subscriptions
Total

$
- 85 -

859,674
362,360
306,511
1,528,545

2012

523,582
258,278
190,449
972,309

2011

260,885
155,848
105,456
522,189

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Year Ended December 31,

2013

Revenue by geographic region:

United States
Other Americas (1)
Total Americas
EMEA (2)
APAC (3)
Total

2012

942,122
109,672
1,051,794
358,244
118,507
1,528,545

2011

619,485
66,099
685,584
217,342
69,383
972,309

353,834
28,800
382,634
109,995
29,560
522,189

(1) Canada, Latin America and South America

(2) Europe, the Middle East and Africa (EMEA)
(3)
Asia-Pacific (APAC)
No individual customer accounted for 10% or more of consolidated net revenue or accounts receivable for any of the periods presented.
Long-Lived Assets
December 31,
2013

United States
Other Americas
Total Americas
EMEA
APAC
Total
14.

328,384
3,836
332,220
13,918
15,603
361,741

2012

172,278
1,071
173,349
6,714
6,614
186,677

2011

105,336
807
106,143
5,090
3,617
114,850

Subsequent Events

In January 2014, the Company leased additional space in New York, New York. The lease expires in 2026 and aggregate future minimum
lease payments for this facility are approximately $25.6 million .
In February 2014, the Company entered into a definitive agreement to acquire Bright Media Corporation (Bright), a job search site
that allows users to search for jobs, find connections at companies, and locate job openings that best fit their experience. The transaction was
valued at approximately $120.0 million as of the execution of the definitive agreement. Approxima tely 73% of the consideration is expected to
be issued as equity consideration, and the remaining 27% is expected to be issued as cash consideration. The final number of shares of the
Company's Class A common stock and the final amount of cash to be issued in connection with the acquisition is subject to adjustment based
on (i) purchase price adjustment provisions, (ii) continuing service obligations to the Company of certain stockholders of Bright, (iii)
indemnification obligations of Bright stockholders after the closing of the acquisition, and (iv) certain elections made by the stockholders of
Bright. For accounting purposes, the equity consideration will be valued based on the closing price of the Companys Class A common stock as
reported by the NYSE on the closing of the acquisition, and is therefore subject to change. The transaction is expected to close in the first
quarter of 2014.

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Item 9.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.
Item 9A.

Controls and Procedures

Disclosure Controls and Procedures

As of the end of the period covered by this report, our management conducted an evaluation, under the supervision and with the
participation of our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure
controls and procedures, as such term is defined in the Securities Exchange Act of 1934 (the Exchange Act). Based upon that evaluation, our
Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the
period covered by this report in ensuring that information required to be disclosed was recorded, processed, summarized and reported within
the time periods specified in the SEC's rules and forms, and to provide reasonable assurance that information required to be disclosed by us in
such reports is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as
appropriate to allow timely decisions regarding required disclosure.
Management's Report on Internal Control Over Financial Reporting
Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is
defined in the Exchange Act. Under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer, our
management conducted an evaluation of the effectiveness of our internal control over financial reporting based upon the framework in Internal
Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on that
evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2013 .
Deloitte & Touche, an independent registered public accounting firm, has audited the consolidated financial statements included in this
Form 10-K and, as part of the audit, has issued a report, included herein, on the effectiveness of LinkedIn's internal control over financial
reporting as of December 31, 2013 .
Changes in Internal Control over Financial Reporting
During the fourth quarter of fiscal 2013, there were no changes in the internal control over financial reporting that materially affected, or
are reasonably likely to materially affect, LinkedIn's internal control over financial reporting.
Inherent Limitations of Disclosure Controls and Procedures and Internal Control over Financial Reporting
It should be noted that any system of controls, however well designed and operated, can provide only reasonable, and not absolute,
assurance that the objectives of the system will be met. In addition, the design of any control system is based in part upon certain assumptions
made by management about the likelihood of future events.
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
LinkedIn Corporation
Mountain View, California
We have audited the internal control over financial reporting of LinkedIn Corporation and subsidiaries (the "Company") as of December 31,
2013 , based on criteria established in Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations
of the Treadway Commission. The Company's management is responsible for maintaining effective internal control over financial reporting and
for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report of
Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial
reporting based on our audit.
We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards
require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was
maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk
that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and
performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for
our opinion.
A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's principal executive
and principal financial officers, or persons performing similar functions, and effected by the company's board of directors, management, and
other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes
those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of
the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a
material effect on the financial statements.
Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management
override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any
evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may
become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2013 ,
based on the criteria established in Internal Control - Integrated Framework (1992) issued by the Committee of Sponsoring Organizations of
the Treadway Commission.
We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated
financial statements as of and for the year ended December 31, 2013 , of the Company and our report dated February 13, 2014, e xpressed an
unqualified opinion on those financial statements.
/s/ DELOITTE & TOUCHE LLP
San Jose, California
February 13, 2014

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Item 9B.

Other Information

None.
PART III
Item 10.

Directors, Executive Officers and Corporate Governance

The information required by this item will be contained in our definitive proxy statement to be filed with the Securities and Exchange
Commission in connection with our 2014 annual meeting of stockholders (the Proxy Statement), which is expected to be filed not later than
120 days after the end of our fiscal year ended December 31, 2013 , and is incorporated in this report by reference.
Item 11.

Executive Compensation

The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference.
Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference.
Item 13.

Certain Relationships and Related Transactions and Director Independence

The information, if any, required by this item will be set forth in the Proxy Statement and is incorporated herein by reference.
Item 14.

Principal Accountant Fees and Services

The information required by this item will be set forth in the Proxy Statement and is incorporated herein by reference.

- 89 -

PART IV
Item 15.

Exhibits, Financial Statement Schedules

(a) The following documents are filed as part of this report:

1. Consolidated Financial Statements
See Index to Consolidated Financial Statements at Item 8 herein.
2. Financial Statement Schedules
Schedules not listed above have been omitted because the information required to be set forth therein is not applicable or is shown in the
financial statements or notes herein.
3. Exhibits
See the Exhibit Index immediately following the signature page of this Annual Report on Form 10-K.
Signatures
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
LINKEDIN CORPORATION
Dated: February 13 , 2014

By:

/S/

J EFFREY W EINER

Jeffrey Weiner
Chief Executive Officer and Director

POWER OF ATTORNEY
Each person whose individual signature appears below hereby authorizes and appoints Erika Rottenberg and Steven Sordello, and each of
them, with full power of substitution and resubstitution and full power to act without the other, as his or her true and lawful attorney-in-fact and
agent to act in his or her name, place and stead and to execute in the name and on behalf of each person, individually and in each capacity
stated below, and to file any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other
documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of
them, full power and authority to do and perform each and every act and thing, ratifying and confirming all that said attorneys-in-fact and
agents or any of them or their or his substitute or substitutes may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on
behalf of the registrant and in the capacities and on the dates indicated.

/s/

Signature

Title

Date

J EFFREY W EINER

Chief Executive Officer and Director

(principal executive officer)

February 13, 2014

Senior Vice President and

Chief Financial Officer
(principal financial officer)

February 13, 2014

Vice President, Corporate Controller

and Chief Accounting Officer
(principal accounting officer)

February 13, 2014

Director

February 13, 2014

Chair of the Board of Directors

February 13, 2014

Director

February 13, 2014

Director

February 13, 2014

Director

February 13, 2014

Director

February 13, 2014

Jeffrey Weiner

/s/

S TEVEN S ORDELLO
Steven Sordello

/s/

S USAN T AYLOR
Susan Taylor

/s/

A. G EORGE S KIP B ATTLE

A. George Skip Battle

/s/

R EID H OFFMAN
Reid Hoffman

/s/

L ESLIE K ILGORE
Leslie Kilgore

/s/

S TANLEY M ERESMAN
Stanley Meresman

/s/

M ICHAEL M ORITZ
Michael Moritz

/s/

D AVID S ZE
David Sze

Table of Contents

Exhibit Index

Exhibit
Number

3.1
3.2
4.1
4.2
4.3

10.1+
10.2+
10.3+
10.4+

10.5+
10.6+
10.7
10.8

10.9A

10.10

Exhibit Description

Form of Amended and Restated

Certificate of Incorporation of LinkedIn
Corporation.
Form of Amended and Restated Bylaws of
LinkedIn Corporation.
Form of LinkedIn Corporations Class A
Common Stock Certificate.
Form of LinkedIn Corporations Class B
Common Stock Certificate.
Third Amended and Restated Investors
Rights Agreement, by and among
LinkedIn Corporation and the investors
listed on Exhibit A thereto, dated June 13,
2008.
Amended and Restated 2003 Stock
Incentive Plan and Form of Stock Option
Agreement.
2011 Equity Incentive Plan and Form of
Stock Option Agreement under 2011
Equity Incentive Plan.
Form of Indemnification Agreement by
and between LinkedIn Corporation and
each of its directors and executive officers.
Offer Letter, between LinkedIn
Corporation and Jeffrey Weiner, dated
September 9, 2009, effective June 24,
2009, as amended.
Offer Letter, between LinkedIn
Corporation and Steven Sordello, dated
June 14, 2007.
Offer Letter, between LinkedIn
Corporation and Dipchand Nishar, dated
November 17, 2008.
Membership Units Purchase Agreement
by and between LinkedIn Corporation and
Reid Hoffman, dated June 13, 2008.
Master Services Agreement by and
between LinkedIn Corporation and
Equinix Operating Co., Inc., dated
February 27, 2008.
Amendment No. 1 to the Master Services
Agreement by and between LinkedIn
Corporation and Equinix Operating Co.,
Inc., dated June 1, 2010.
Lease by and between LinkedIn
Corporation and Britannia Hacienda VIII
LLC, dated March 20, 2007.

Incorporated by Reference
Form

File No.

Exhibit(s)

Filing Date

S-1

333-171903

3.2

March 11, 2011

S-1

333-171903

3.4

March 11, 2011

S-1

333-171903

4.1

May 9, 2011

S-1

333-171903

4.2

May 9, 2011

S-1

333-171903

4.2

January 27, 2011

S-1

333-171903

10.1

January 27, 2011

S-1

333-171903

10.2

May 4, 2011

S-1

333-171903

10.3

March 11, 2011

S-1

333-171903

10.4

January 27, 2011

S-1

333-171903

10.5

January 27, 2011

S-1

333-171903

10.7

January 27, 2011

S-1

333-171903

10.1

January 27, 2011

S-1

333-171903

10.1

January 27, 2011

S-1

333-171903

10.13A

April 4, 2011

S-1

333-171903

10.14

January 27, 2011

- 92 -

Table of Contents

Exhibit
Number

10.11A

10.11B

10.11C

10.11D

10.11E

10.11F

10.12
10.13
10.14+
10.15+
10.16
10.17+
10.18

10.18A

10.19+

Exhibit Description

First Amendment to Lease by and

between LinkedIn Corporation and
Britannia Hacienda VIII LLC, dated
September 24, 2007.
Second Amendment to Lease by and
between LinkedIn Corporation and
Britannia Hacienda VIII LLC, dated June
25, 2008.
Third Amendment to Lease by and
between LinkedIn Corporation and
Britannia Hacienda VIII LLC, dated
December 18, 2009.
Fourth Amendment to Lease by and
between LinkedIn Corporation and
Britannia Hacienda VIII LLC, dated
March 3, 2010.
Fifth Amendment to Lease by and
between LinkedIn Corporation and
Britannia Hacienda VIII LLC, dated
December 17, 2010.
Sixth Amendment to Lease by and
between LinkedIn Corporation and
Britannia Hacienda VIII LLC, dated
October 25, 2011.
Sublease by and between LinkedIn
Corporation and Omnicell, Inc., dated
January 4, 2011.
Sublease by and between LinkedIn
Corporation and Actel Corporation, dated
February 18, 2010.
2011 Employee Stock Purchase Plan.
Form of Supplement to Offer Letter by
and between LinkedIn Corporation and
certain named executive officers.
Form of Restricted Stock Unit Agreement
under 2011 Equity Incentive Plan.
2013 Executive Bonus Compensation
Plan.
Lease by and among LinkedIn
Corporation and Sequoia M&M LLC,
Sequoia M&P LLC, and Sequoia Del Rey,
LLC (collectively, the Landlord), dated
August 22, 2012.
First Amendment to Lease Agreement by
and between LinkedIn Corporation and
the Landlord, dated December 13, 2013.
The Lease, as amended, has been assigned
by Landlord to Kilroy Realty Corporation.
Form of Change of Control Agreement
between LinkedIn Corporation and certain
named executive officers.

Incorporated by Reference
Form

File No.

Exhibit(s)

Filing Date

S-1

333-171903

10.14A

January 27, 2011

S-1

333-171903

10.14B

January 27, 2011

S-1

333-171903

10.14C

January 27, 2011

S-1

333-171903

10.14D

January 27, 2011

S-1

333-171903

10.14E

January 27, 2011

8-K

001-35168

10.1

October 28, 2011

S-1

333-171903

10.15

January 27, 2011

S-1

333-171903

10.16

January 27, 2011

S-1
S-1

333-171903
333-171903

10.17
10.2

May 4, 2011
May 4, 2011

10-Q

001-35168

10.10

August 9, 2011

10-Q

001-35168

10.10

May 2, 2013

10-Q

001-35168

10.10

November 1, 2012

8-K

001-35168

10.10

December 18, 2012

- 93 -

Table of Contents

Exhibit
Number

Exhibit Description

Incorporated by Reference
Form

21.1
23.1
24.1
31.1

31.2

32.1

101.INS
101.SCH
101.CAL
101.LAB
101.PRE
101.DEF

List of subsidiaries.
Consent of Deloitte & Touche LLP,
independent registered public accounting
firm.
Power of Attorney (see the signature page
to this Annual Report on Form 10-K).
Certification of Principal Executive Officer
Required Under Rule 13a-14(a) and 15d14(a) of the Securities Exchange Act of
1934, as amended.
Certification of Principal Financial Officer
Required Under Rule 13a-14(a) and 15d14(a) of the Securities Exchange Act of
1934, as amended.
Certification of Principal Executive Officer
and Principal Financial Officer Required
Under Rule 13a-14(b) of the Securities
Exchange Act of 1934, as amended, and 18
U.S.C. 1350.
XBRL Instance Document
XBRL Taxonomy Extension Schema
XBRL Taxonomy Extension Calculation
Linkbase
XBRL Taxonomy Extension Label
Linkbase
XBRL Taxonomy Extension Presentation
Linkbase
XBRL Taxonomy Extension Definition
Linkbase

Indicates a management contract or compensatory plan.

Portions of have been granted confidential treatment by the SEC.

- 94 -

File No.

Exhibit(s)

Filing Date

Exhibit 10.19
FORM OF CHANGE OF CONTROL AGREEMENT
[Date]

Dear __________,
On behalf of LinkedIn Corporation ( LinkedIn or the Company ), I am pleased to notify you that, subject to
approval of LinkedIns Compensation Committee, you will be entitled to certain additional severance protection for
you in the event of a change of control of the Company, as defined in Exhibit A to this letter ( Change of Control ).
1.

Change of Control Severance .

We recognize that upon a Change of Control, it is appropriate to provide you with protection if your employment is
involuntarily terminated without cause and/or you are constructively terminated following such a Change of Control.
Accordingly, if within twelve (12) months following a Change of Control, your employment is involuntary terminated
without Cause or your employment is constructively terminated and you choose to resign within a reasonable period
of time following such Constructive Termination, then, subject to the terms and conditions set forth in Exhibit B , upon
such involuntary termination without Cause or resignation within a reasonable period of time following Constructive
Termination, you will be entitled to the following severance payments and benefits:
a lump sum payment equal to twelve (12) months of your base salary at the rate in effect on the date of your
termination, or, if greater, the rate in effect immediately prior to the Change of Control;
a lump sum payment equal to your annual target bonus (corporate and individual performance components at
100% of annual target) for the year of termination, or, if greater, your annual target bonus in effect immediately
prior to the Change of Control;

if you timely elect continuation coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of
1985, as amended ( COBRA ) for you, your spouse and eligible dependants, as applicable, the Company will
pay directly on your behalf the monthly premiums under COBRA for such coverage until the earliest of (A)
twelve (12) months following the effective date of such termination, or (B) the date upon which you begin
other employment that provides for health coverage benefits. In addition, and notwithstanding anything to the
contrary in this paragraph, if the Company determines in its sole and reasonable discretion that it cannot pay
directly on your behalf or reimburse you the COBRA premiums without potentially violating applicable law
(including, without limitation, Section 2716 of the Public Health Service Act), the Company will in lieu thereof
provide to you a taxable monthly payment in an amount equal to the monthly COBRA premium that you would
be required to pay to continue your group health coverage in effect on the date of such termination, which
payments will be made regardless of whether you elect COBRA continuation coverage. For purposes of
clarification, the previous sentence does not impact your ability to elect COBRA coverage. If the Company
chooses make payments under this paragraph rather than paying the COBRA premiums directly on your behalf
or directly reimbursing you, the amounts paid to you will include any additional amounts necessary to put you
in the same after-tax position as if the Company had made COBRA payments directly on your behalf or
directly reimbursed you for the same; and
immediate vesting of [ ]% of all of your outstanding equity awards (whether or not in the form of stock options,
restricted stock, or any other type of equity) that remain unvested as of the date of your termination. For
clarification purposes, this vesting acceleration is to apply to your outstanding equity awards, together with any
equity awards that may be granted to you in the future.
For purposes of this offer letter, Cause, Change of Control, and Constructive Termination will have the meaning
set forth on Exhibit A .
2.
Full Force and Effect .
Any equity grant agreements between you and the Company will remain in full force and effect.
3.
Entire Agreement .
This letter, together with agreements relating to your outstanding equity grants, constitute the full and entire
understanding and agreement between you and LinkedIn with regard to the subjects hereof and thereof. This letter may
be amended at any time only by mutual written agreement of you and LinkedIn.
4.

Governing Law .

This amendment will be governed by the laws of the State of California (with the exception of its conflict of law
provisions).
[Signature Page to Follow]

Sincerely,
/s/
[Name]
[Title]
LinkedIn Corporation

Agreed and Accepted as of:

/s/
[Name]

Date

Address

[SIGNATURE PAGE TO CHANGE OF CONTROL AGREEMENT]

EXHIBIT A
For purposes of this offer letter, the following definitions will apply:
Cause will mean: (i) you engaging in knowing and intentional illegal conduct that was or is materially injurious to
the Company or its affiliates; (ii) you violating a federal or state law or regulation applicable to the Companys business
which violation was or is reasonably likely to be injurious to the Company; (iii) you materially breaching the terms of
any confidentiality agreement or invention assignment agreement between you and the Company; (iv) you being
convicted of, or entering a plea of nolo contendere to, a felony or committing any act of - moral turpitude, dishonesty or
fraud against, or the misappropriation of material property belonging to, the Company or its affiliates or (v) your willful
and continued failure to perform the duties and responsibilities of your position (other than as a result of your complete
or partial incapacity due to physical or mental illness or impairment) after you have been delivered a written demand
for performance from the Company which describes the basis for its belief that you have not substantially performed
your duties and responsibilities and you have failed to cure such non-performance to the Companys satisfaction within
thirty (30) days after receiving such notice.
Change of Control will mean the consummation of a reorganization, merger or consolidation, or sale or other
disposition of all or substantially all dine assets of the Company, or the acquisition of assets of another corporation or
entity, or other similar transaction (each, a Business Combination ), unless, in each case, immediately following such
Business Combination (A) all or substantially all of the individuals and entities who were the beneficial owners of
voting stock of the Company immediately prior to such Business Combination beneficially own, directly or indirectly,
more than 55% of the combined voting power of the then outstanding shares of voting stock of the entity resulting from
such Business Combination (including, without limitation, an entity which as a result of such transaction owns the
Company or all or substantially all of the Companys assets either directly or through one or more subsidiaries,) and (B)
at least a majority of the members of the Board of Directors of the entity resulting from such Business Combination
were members of the Board of Directors of the Company at the time of the execution of the initial agreement or of the
action of the Board of Directors providing for such Business Combination.
Constructive Termination will mean (i) without your written consent, a reduction in your base salary, other than a
reduction in salary that is part of an expense reduction effort applied to the executive management team (defined as the
Chief Executive Officers direct reports) generally and which results in a percentage reduction of your salary or bonus
no greater than the greatest percentage reduction applied to at least one other member of the executive management
team; or (ii) without your written consent, a relocation of your principal place of work to a location more than 35 miles
away from your workplace prior to the relocation; or (iii) without your written consent, a material reduction or loss of
responsibility of title.

EXHIBIT B
The receipt of any severance benefits pursuant to this letter is conditioned upon your signing the Companys then
current standard form of release releasing the Company (or any successor entity), its officers, directors and affiliates
from all liability whatsoever (the Release ). The Release must become effective and irrevocable no later than sixty
(60) days following your termination of employment with the Company. No severance payments and benefits under
this amendment will be paid or provided until the Release becomes effective and irrevocable, and any such severance
payments and benefits otherwise payable between the date of your termination of employment with the Company and
the date the Release becomes effective and irrevocable will be paid on the 60 th day following the date of your
termination of employment with the Company.
Notwithstanding anything to the contrary in this document, no severance payments or benefits payable to you, if any,
that, when considered together with any other severance payments or separation benefits, is considered deferred
compensation under Section 409A ( Section 409A ) of the Internal Revenue Code of 1986, as amended (together, the
Deferred Payments ) will be payable until you have a separation from service within the meaning of Section 409A.
Similarly, no severance payments or benefits payable to you, if any, pursuant to this letter that otherwise would be
exempt from Section 409A pursuant to Treasury Regulation Section 1.409A-1(b)(9) will be payable until you have a
separation from service within the meaning of Section 409A. Any severance payments or benefits that would be
considered Deferred Payments will be paid on, or, in the case of installments, will not commence until, the sixtieth (60
th ) day following your separation from service, or, if later, such time as required by the following paragraph. Except as
required by the following paragraph, any installment payments that would have been made to you during the sixty (60)
day period immediately following your separation from service but for the preceding sentence will be paid to you on
the sixtieth (60 th ) day following your separation from service and the remaining payments will be made as provided in
this offer letter.
Further, if you are a specified employee within the meaning of Section 409A at the time of your separation from
service (other than due to death), any Deferred Payments that otherwise are payable within the first six (6) months
following your separation from service will become payable on the first payroll date that occurs on or after the date six
(6) months and one (1) day following the date of your separation from service. All subsequent Deferred Payments, if
any, will be payable in accordance with the payment schedule applicable to each payment or benefit. Notwithstanding
anything herein to the contrary, in the event of your death following your separation from service but prior to the six (6)
month anniversary of your separation from service (or any later delay date), then any payments delayed in accordance
with this paragraph will be payable in a lump sum as soon as administratively practicable after the date of your death
and all other Deferred Payments will be payable in accordance with the payment schedule applicable to each payment
or benefit. Each payment and benefit payable under the Agreement is intended to constitute a separate payment for
purposes of Section 1.409A-2(b)(2) of the Treasury Regulations.
The provisions under this document are intended to comply with, or be exempt from, the requirements of Section 409A
so that none of the severance payments and benefits to be provided will be subject to the additional tax imposed under
Section 409A, and any ambiguities herein will be interpreted to so comply or be exempt. You and the Company agree
to work together in good faith to consider amendments to this document and to take such reasonable actions, which are
necessary, appropriate or desirable to avoid imposition of any additional tax or income recognition prior to actual
payment to you under Section 409A. In no event will the Company reimburse you for any taxes that may be imposed
on you as result of Section 409A

Exhibit 21.1
SUBSIDIARIES OF THE REGISTRANT
The following is a list of subsidiaries of LinkedIn Corporation as of December 31, 2013 :

Name of Subsidiary

LinkedIn Global Ltd

LinkedIn International
LinkedIn Worldwide
LinkedIn Technology
LinkedIn Ireland
LinkedIn Australia Pty Limited
LinkedIn Technology Canada Inc.
LinkedIn Netherlands B.V.
LinkedIn Technology Information Private Limited
LinkedIn France SAS
LinkedIn Technology UK Limited
LinkedIn Italy S.R.L.
LinkedIn Singapore Pte. Ltd.
LinkedIn Japan Ltd
LinkedIn Sweden AB
LinkedIn Germany GmbH
LinkedIn Representacoes do Brasil Ltda.
LinkedIn Spain, S.L.
LinkedIn Hong Kong Limited
LinkedIn Middle East FZ-LLC
LinkedIn CN Limited
Linked HK Holding Limited

Jurisdiction of Incorporation or Organization

Isle of Man
Isle of Man
Isle of Man
Ireland (non-resident Irish company with tax residence in Isle of
Man)
Ireland
Australia
Canada
Netherlands
India
France
United Kingdom
Italy
Singapore
Japan
Sweden
Germany
Brazil
Spain
Hong Kong
United Arab Emirates
Isle of Man
Hong Kong

Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in Registration Statement Nos. 333-174454, 333-181806 and 333-188276 on Form S-8 of our
reports dated February 13, 2014 , relating to the consolidated financial statements of LinkedIn Corporation and its subsidiaries (the
Company), and the effectiveness of the Companys internal control over financial reporting appearing in this Annual Report on Form 10-K of
LinkedIn Corporation for the year ended December 31, 2013 .

/s/ DELOITTE & TOUCHE LLP

San Jose, California
February 13, 2014

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

PURSUANT TO EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a),
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Jeffrey Weiner, certify that:
1. I have reviewed this Annual Report on Form 10-K of LinkedIn Corporation;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period
covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under
our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely
to materially affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent
functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal
control over financial reporting.

Date: February 13, 2014

/s/ Jeffrey Weiner

Jeffrey Weiner
Chief Executive Officer

Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO EXCHANGE ACT RULES 13a-14(a) AND 15d-14(a),
AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Steven Sordello, certify that:
1. I have reviewed this Annual Report on Form 10-K of LinkedIn Corporation;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to
make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period
covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material
respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as
defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a15(f) and 15d-15(f)) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our
supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under
our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
(d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most
recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely
to materially affect, the registrant's internal control over financial reporting; and
5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial
reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent
functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal
control over financial reporting.

Date: February 13, 2014

/s/ Steven Sordello
Steven Sordello
Senior Vice President and Chief Financial Officer

Exhibit 32.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER
PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
I, Jeffrey Weiner, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the
Annual Report of LinkedIn Corporation on Form 10-K for the fiscal year ended December 31, 2013 fully complies with the requirements of
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Annual Report on Form 10-K fairly
presents, in all material respects, the financial condition and results of operations of LinkedIn Corporation.
Date: February 13, 2014
By:
Name:
Title:

/s/ Jeffrey Weiner

Jeffrey Weiner
Chief Executive Officer

I, Steven Sordello, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that the
Annual Report of LinkedIn Corporation on Form 10-K for the fiscal year ended December 31, 2013 fully complies with the requirements of
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and that information contained in such Annual Report on Form 10-K fairly
presents, in all material respects, the financial condition and results of operations of LinkedIn Corporation.
Date: February 13, 2014
By:
Name:
Title:

/s/ Steven Sordello

Steven Sordello
Senior Vice President and Chief Financial Officer