User-review websites operator Yelp loses €1.14m in first quarter

Yelp, the operator of user-review websites, fell to its lowest intraday level since 2013 after the company's profit and sales forecast missed analysts' estimates.

The San Francisco-based company reported a first-quarter loss of $1.28 million (€1.14m) , or 2 cents a share, from $2.64 million (€2.36m), or 4 cents, a year earlier.

Analysts' estimated a profit of 1 cent. Revenue was $118.5 million, the company said in a statement on Wednesday, trailing estimates of $119.8, according to data compiled by Bloomberg.

Yelp forecast second-quarter sales of $131 million to $134 million, falling short of analysts’ average estimate of $137.4 million.

"There's not a lot of forgiveness for technology companies right now," said Blake Harper, an analyst at Wunderlich Securities.

“They are valued pretty well and there’s an expectation that they’ll perform well.”

Yelp operates websites that let users search local businesses for free and read reviews about them.

The company charges for advertising on those sites. It had 142 million unique monthly visitors in the period, an increase of 7.6 per cent from a year earlier.

Yelp’s local advertising revenue dropped as a result of a sales-force restructuring implemented in the first quarter, Mr Harper said.

The company’s shares fell 19 per cent to $41.48. Thursday, hitting a low since July 2013.

The company competes with Angie's List as well as new features offered by companies including Amazon. com.

In February, it purchased food-ordering service Eat24. com in a cash-and-stock deal valued at $134 million.

"We will continue to seek ways to increase engagement and drive awareness, while striving to demonstrate the value we can deliver to local businesses in order to capture the large local advertising market opportunity," chief executive Jeremy Stoppelman said in the statement.

- Bloomberg