Profits jump threefold at LinkedIn’s Irish unit to $294.2m
Social network giant pays $200m in dividends and $69m in tax
The bulk of LinkedIn’s increase in profits was accounted for by intra-company transactions. Photograph: Robert Galbrait/ Reuters
Profits at the Irish arm of professional social network giant LinkedIn multiplied more than threefold last year.
Accounts just filed for LinkedIn Ireland Unlimited Company show the Microsoft-owned group reported a profit before tax of $294.2 million (€245.9 million) in 2019, up from $84.8 million the previous year.
The bulk of the increase was accounted for by intra-company transactions. The Irish unit, which manages LinkedIn’s operations in Europe, the Middle East and Africa (EMEA), received $147.8 million in interest on loans, mostly to Microsoft Global Finance. That was more than $100 million up on similar interest payments in 2018.
It also booked a $46.5 million profit on the sale of intangible assets – in this case its intellectual property – to Microsoft Operation Puerto Rico. That is a $30 million increase on such disposals in 2018.
At the operating level, profit was $80 million ahead of 2018 at $126.9 million. Revenues were 27 per cent stronger at $2.76 billion.
The company also disclosed that it paid a dividend of $200 million during the year. That brings dividend payments over the past two years to $1 billion.
Last year, LinkedIn announced the creation of a further 800 jobs in Ireland, bringing the headcount at its EMEA headquarters at Wilton Place in Dublin to 2,000.
The company also recorded a milestone in its Irish membership base passing the two million mark in 2019. The directors state that globally the number of members on the LinkedIn platform last year increased by 90 million to more than 660 million.
On the impact of Covid 19, the directors state that LinkedIn had made substantial changes to employee travel policies, implemented office closures and cancelled or shifted conferences to virtual only.
While cautious on predicting the final scale of the impact on operations and revenues, the company said Covid “will result in a significant reduction in revenue growth as a material mix of LinkedIn’s revenue is driven by customer hiring needs and advertising”.
The new accounts show that last year, numbers employed at the LinkedIn Dublin base increased by 315 from 1,296 to 1,611.
The $167.24 million paid out in salaries last year indicates that the average salary of its Irish workforce was $103,815 before $20.8 million paid out in share-based payments was taken into account.
Directors’ pay last year increased from $1.29 million to $1.5 million.
The company recorded post-tax profits of $225.13 million after paying corporation tax of $69.09 million.
At the end of December last year, the company had shareholder funds of $6.2 billion that included accumulated profits of $581 million.
The company has subsidiaries based in 17 countries – the UK, Canada, India, France, Netherlands, Italy, Japan, Germany, Spain, the United Arab Emirates, Hong Kong, Singapore, Sweden, Brazil, Austria, Malaysia and Mexico.