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LinkedIn profit beats as hiring services, ads revenue jumps

LinkedIn Corp’s (LNKD.N) quarterly revenue and profit handily beat analysts’ estimates as the world’s biggest professional networking website operator earned more from its recruitment services business and from advertisements and paid memberships.

Shares of the company, which also raised its full-year profit and revenue forecasts, jumped 12 percent in extended trading on Thursday.

LinkedIn has been spending heavily on expansion by buying up companies, hiring sales personnel and increasing its presence in China and other markets outside the United States.

Expanded offerings helped boost revenue from the company’s Talents Solutions business, which connects recruiters and job seekers, by 46 percent in the third quarter. The business accounted for nearly two-thirds of LinkedIn’s total revenue.

Revenue from advertisements on its website rose 28 percent, while paid membership income increased 21 percent.

LinkedIn, which operates in over 200 countries and territories, said the total number of members rose 20 percent to 396 million at the end of the third quarter.

The company said the number of its subscribers in China had more than tripled since early 2014, when it launched a local language version, to over 13 million currently.

LinkedIn also said 55 percent of its traffic was through mobile devices such as smartphones and tablets.

The company raised its 2015 revenue forecast to $2.975 billion-$2.980 billion from $2.94 billion, and adjusted profit forecast to about $2.63 per share from about $2.19.

The net loss attributable to shareholders widened to $40.5 million, or 31 cents per share, in the quarter ended Sept. 30 as costs surged 46 percent.

Excluding items, LinkedIn earned 78 cents per share, topping the average analyst estimate of 46 cents, according to Thomson Reuters I/B/E/S.

Revenue rose 37.2 percent to $779.6 million, beating analysts’ expectations of $755.8 million, partly due to the acquisition of training video company in May.

LinkedIn shares were trading at $243.27 after the bell.

Up to Thursday’s close, the stock had risen about 31 percent from its year-low of $165.57 hit on Aug. 24.

(Reporting by Devika Krishna Kumar and AlanJohn Koshy in Bengaluru; Editing by Kirti Pandey)

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Virgin America tops third-quarter estimates, expects unit revenue decline

Virgin America Inc (VA.O) on Thursday said lower fuel costs helped its profit jump in the third quarter, but forecast that the money it makes per mile would fall in the fourth quarter as it expands flight capacity amid intense competition.

The Burlingame, California-based airline earned $71.9 million in the quarter, up 73 percent from a year earlier. Excluding special items, it earned $73 million, or $1.64 per share, topping the average analyst estimate of $67 million, or $1.56 per share, according to Thomson Reuters I/B/E/S.

However, it said a key indicator of the business’s long-term health would fall in the fourth quarter. It expects passenger unit revenue, which compares sales to capacity, will fall between 3 percent and 5 percent from a year ago.

That is in part because Virgin America expects to add two single-aisle planes into service in the quarter, contributing to an uptick in capacity between 9.5 percent and 10.5 percent from a year earlier. Its fleet totaled 55 planes at the end of the third quarter.

Capacity has also outpaced demand in some cities to which Virgin America flies, particularly Dallas, pushing down fares.

Chief Executive David Cush said in an interview that plans by American Airlines Group Inc (AAL.O) to roll out cheap fares with more restrictions in 2016 could intensify competition.

The result is passenger unit revenue guidance that’s “definitely worse” than anticipated, said Sterne Agee CRT analyst Adam Hackel.

The same measure fell 2.7 percent in the third quarter.

More growth is in the airline’s future.

Chief Financial Officer Peter Hunt said in the same interview that Virgin America aims to expand capacity by around 10 percent per year. It is considering service to new cities such as Phoenix, Houston and Denver to attract business travelers.

Cush said Virgin America is “very interested” in leasing several A321 planes made by Airbus Group SE (AIR.PA), which would be the largest in its fleet and would help it fly more customers to slot-constrained airports.

Virgin America forecast unit costs excluding fuel, profit-sharing and special items will rise between 2 percent and 3 percent in the fourth quarter because of higher wages and benefits.

In the third quarter, the airline’s operating profit margin was 18.2 percent, up 5.3 points from a year ago, as the average price of its largest variable expense, fuel, fell 38.7 percent.

Shares were up 0.2 percent at $35.23 in late Nasdaq trading.

(Reporting By Jeffrey Dastin in New York; Editing by Nick Zieminski)

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U.S. wary of EU proposal for investment court in trade pact

WASHINGTON/BRUSSELS The United States is wary of a European Union proposal for a new court system to settle investment disputes as part of the world’s biggest free-trade agreement, U.S. Trade Representative Michael Froman said.

A Pacific trade deal agreed earlier this month amended rules allowing foreign companies to take legal action against governments to add more safeguards, he said, and Washington was open to discussing other reforms as part of a proposed trade deal with the EU.

But he was not sure about the EU’s idea for a new court system with an appeal tribunal, proposed after concerns that U.S. multinationals could use private arbitration rules in the Transatlantic Trade and Investment Partnership (TTIP) to challenge European food and environmental laws.

“Because of the high standards and safeguards in our agreements, there have been very few cases against the U.S., and to date, the government has never lost,” Froman said in an interview Wednesday, in comments approved for release on Thursday.

“It’s not obvious to me why you would want to give companies a second bite of the apple.”

Investor-state rules aim to protect foreign companies from unfair treatment by host governments and provide compensation if assets are appropriated. But critics have also noted a trend towards challenges over regulations, such as Marlboro maker Philip Morris’s (PM.N) action against Australian laws mandating plain packaging for cigarettes.

Froman said Washington’s baseline for TTIP included both model U.S. investor-state rules adopted in 2012 and a revised version contained in the 12-nation Trans-Pacific Partnership (TPP). Details of that agreement are yet to be released.

TPP safeguards included no forum shopping, to prevent companies going back to domestic courts if they lose challenges in special investor-state dispute forums, he said.

They also enshrined governments’ right to regulate for health safety and the environment, put the burden of proof on the claimant to prove there is a violation of the standard, and stopped companies suing on lost profit expectations or because of an expectation that regulations would remain static, he said.

Froman said there was every chance TTIP, which seeks to harmonize regulations as well as cut tariffs on exports, could be wrapped up in 2016.

“I don’t think there’s any reason it can’t get done before this administration is over. I think that’s in our mutual interest,” he said.

(Editing by Bernadette Baum)

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Wal-Mart tweaks discount strategy for holiday season

Wal-Mart Stores Inc (WMT.N) said it would offer fewer “this weekend only” short-term deals during the holiday shopping season while discounting thousands of items for 90 days as it seeks to entice customers by being more consistent on pricing.

The retailer also said it was launching a new mobile application to reduce waiting times for in-store pickup of online orders as part of an effort to expand a service in which it believes it has an advantage over rivals, like Inc (AMZN.O), which lack a bricks-and-mortar presence.

The moves were announced in a media briefing to outline its strategy for the November to December holiday shopping season, a crucial time for retailers during which they earn an outsized portion of their annual profits and sales.

The decision to offer fewer short-term discounts comes at a time when Wal-Mart is seeking to burnish its reputation for low prices amid relentless competition online from, supermarkets and dollar stores. It said customers were frustrated by “gimmicks” and wanted more consistent pricing.

“We will not be beat on pricing this holiday,” said Steve Bratspies, chief merchandising officer for Wal-Mart’s U.S. operations, noting its policy of matching rivals’ prices at its stores. “If we need to react we will.”

Wal-Mart said that it would have more “rollbacks”, or discounts that last for 90 days, than the 20,000 offered last year, although it did not give an exact figure. Bratspies said the discounts would be across all categories.

Wal-Mart also said it was introducing a “mobile check-in” function to its mobile phone application that would allow shoppers picking up online orders to easily notify the store when arriving to cut down on waiting times.

Wal-Mart said that it was focusing on in-store pickup as a way to take advantage of its 4,500 stores in the U.S. It has recently expanded curbside pickup for groceries ordered online to 23 markets, with plans to add 20 more early next year.

(Reporting by Nathan Layne; Editing by Chris Reese and Christian Plumb)

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Boeing lands international 787 orders worth $3.5 billion

SEATTLE Boeing Co (BA.N) landed orders from two foreign carriers for its high-tech 787 Dreamliner on Thursday worth more than $3.5 billion at list prices.

The deals with El Al Israel Airlines Ltd (ELAL.TA) and Australia’s Qantas Airways Ltd QAN.AX mean that 59 airlines and leasing companies have now ordered Boeing’s latest jetliner.

The orders came as rival Airbus (AIR.PA) on Thursday sold 100 of its single-aisle A320s and 30 of its widebody A330s to China.

Qantas’ commitment to the 787 had been in doubt after it canceled 35 orders for the stretched 787-9 model in 2012 amid financial losses. At the time, it kept 15 orders for smaller 787-8s for its Jetstar Airways subsidiary. In August the mainline Australian carrier said it intended to use 787-9s as it overhauled its international fleet.

The Qantas order announced on Thursday includes five 787-9 Dreamliners worth $1.3 billion, and conversion of three 787-8s from Jetstar into 787-9s.

El Al ordered nine 787s, including three firm orders for 787-9s. The order, valued at more than $2.2 billion, is the largest in the airline’s history and keeps El Al an all-Boeing airline. El Al said it also intends to lease six more 787s as part of its plan to increase capacity.

The models for the rest of El Al’s order will be determined as the contracts are finalized, Boeing said.

(Reporting by Alwyn Scott; Editing by Bill Rigby)

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Time Warner Cable, Charter expect deal closing in first quarter 2016, not 2015

Charter Communications Inc (CHTR.O) said its acquisition of Time Warner Cable Inc (TWC.N), which is awaiting clearance from U.S. regulators, is now expected to close in the first quarter of 2016, and not by the end of 2015 as planned.

The $56 billion deal, announced in May, is subject to intense regulatory scrutiny as the combined company would control a big swath of the U.S. cable and Internet market.

“Realistically, we think we’re looking at a first-quarter close,” Charter Chief Executive Tom Rutledge said on a call on Thursday to discuss the company’s third-quarter results.

The deal has been approved by the shareholders of both companies and most U.S. states, but is awaiting clearance from the U.S. Department of Justice and the Federal Communications Commission (FCC).

“From an operational perspective, we are working to be in a position to close as early as this year, but admittedly at this point that feels ambitious,” a Time Warner Cable executive said on a post-earnings call, declining to provide details.

National Association of Broadcasters and Dish Network Corp (DISH.O) have separately petitioned the FCC to reject the proposed merger, which Dish said would be no better for public interest than Comcast’s proposed deal.

Comcast Corp (CMCSA.O) dropped a $45 billion bid for Time Warner Cable in April after regulators raised concerns that the deal would give the market leader an unfair advantage.

The delay in closing the deal came as no surprise to analysts at MoffettNathanson and Evercore ISI. Charter also has a better chance of closing the deal than Comcast did, they said.

“The magnitude and depth of opponents to this transaction was substantially lower than on the Comcast-Time Warner Cable transaction,” Evercore’s Vijay Jayant said. He said the deal could close by March if everything went to plan.


Shares of Time Warner Cable and Charter were up 2.5 percent and 3.6 percent, respectively, in midday trading on Thursday after both companies posted strong third-quarter results.

Time Warner Cable posted a better-than-expected adjusted profit as, on a net basis, it added more high-speed data customers than expected and lost fewer net video subscribers than feared.

While the company is benefiting from rising demand for high-speed internet services, it stemmed video subscriber losses by offering “triple play bundling” services, combining pay-TV, high speed data and voice.

Charter swung to a quarterly profit, also helped by its Internet business, as well as a $142 million tax benefit.

(Reporting by Anya George Tharakan and Sai Sachin R in Bengaluru; Editing by Savio D’Souza)

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U.S. judge rejects creditors’ request to remove Caesars’ lawyers

CHICAGO A judge has rejected an unusual attempt by junior bondholders of Caesars Entertainment’s bankrupt operating unit to disqualify law firm Kirkland Ellis from leading the casino group’s $18 billion Chapter 11 restructuring.

Jones Day, the junior bondholders’ law firm, had asked the court to reconsider a May order that allowed the bankrupt unit of Caesars Entertainment Corp (CZR.O) to hire Kirkland, led by a lawyer known in the industry as the “godfather of restructuring,” James Sprayregen.

The fresh motion in the contentious bankruptcy case accused Sprayregen of giving misleading court testimony earlier this year regarding pre-bankruptcy work Kirkland handled for Caesars. Jones said it unearthed new evidence including minutes from a 2014 board meeting.

Jones Day’s heavily redacted filing did not disclose the meeting minutes.

Allegations of misleading a court about potential conflicts have led to law firms being forced to disgorge fees and even criminal convictions. Kirkland Ellis has billed $21 million for the case through May, according to court filings.

In his denial to consider the motion at a Nov. 18 hearing, U.S. Bankruptcy Judge Benjamin Goldgar of Illinois said Jones Day should have requested court permission before filing such a restricted document.

He said they could ask to refile the motion.

Jones Day is led by Bruce Bennett, who squared off against Sprayregen in the landmark Detroit municipal bankruptcy case.

Kirkland has overseen some of the biggest corporate bankruptcy cases in recent years, including Energy Future Holdings and United Airlines UAL Corp.

No one from Kirkland or Jones Day could immediately be reached for comment.

(Reporting by Tracy Rucinski; Editing by Matthew Lewis)

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VW eyes 10-20 people responsible for emissions rigging: source

HAMBURG Volkswagen (VOWG_p.DE) believes that up to around 20 people were involved in its rigging of diesel-engine emissions tests, a person familiar with the matter said on Thursday.

A source told Reuters earlier this month that more than ten senior managers had been suspended during an internal inquiry at the German carmaker. Sources have provided the names of six suspended top managers including three brand executives.

“The number of people responsible will not be confined to a handful,” the person said, declining to be identified because the matter is supposed to be confidential. “This should be a two-digit number in the range of between 10 and 20.”

Europe’s biggest carmaker admitted last month to cheating diesel emissions tests in the United States, triggering a crisis that has wiped more than a quarter off its stock market value, forced out its long-time chief executive and rocked both the global auto industry and German establishment.

VW’s U.S. chief, Michael Horn, sparked criticism from some lawmakers earlier this month by saying he believed “a couple of software engineers” were responsible.

The number of people involved is a key issue for investors because it could affect the size of potential fines and the extent of management change at the company.

VW’s internal investigation is currently focusing on as many as 40 employees involved in activities related to the manipulations, the person said.

“This includes a number of people who can be ruled out as perpetrators but who were witnesses,” the person said. He did not say whether any of the individuals included board members.

VW declined to comment.

Prosecutors from Braunschweig, close to VW’s home town of Wolfsburg, are investigating several people on initial suspicion of criminal offences such as fraud or violation of competition rules, a spokesman said.

Earlier this month, the prosecutors raided VW’s Wolfsburg headquarters and other offices, targeting documents and data storage devices.

VW has hired consultants Deloitte to support an investigation into the scandal by U.S. law firm Jones Day, with new Chief Executive Matthias Mueller saying those responsible would face tough consequences.

Investigators are looking into documents and computer files dating back as far as 2005 when VW took steps to push diesel-engine technology in the United States as part of a drive to improve its performance in the world’s then largest auto market.

VW said on Wednesday it had set aside 6.7 billion euros ($7.3 billion) to cover initial costs related to the scandal, but added it did not know what the final bill would be. Some analysts have said it could reach 35 billion euros in regulatory fines, lawsuits and vehicle refits.

($1 = 0.9135 euros)

(Writing by Andreas Cremer; Editing by Andreas Framke and Mark Potter)

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VW will stand by $900 million investments in Chattanooga plant

BERLIN Volkswagen (VOWG_p.DE) will stand by its plans to invest $900 million at its U.S. factory in Chattanooga, Tennessee to build a new midsize sport-utility vehicle, it said on Thursday.

VW announced the plans last year together with steps to create an extra 2,000 jobs in the U.S. to boost business in the world’s second largest auto market where its rigging of emissions tests became public last month.

Sources told Reuters this week that VW has shelved a planned overhaul of the management of its North American business and will not address its strategy there until it has reached legal agreements over the cheating of emissions tests.

(Reporting by Andreas Cremer; Editing by Arno Schuetze)

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