Can LinkedIn Drive Global Growth?

In today's world, most companies span several regions and sell across the world. As my Foolish colleague Morgan Housel notes, 10 years ago, less than a third of S&P 500 revenue growth came from abroad. Today, that area makes up half of the S&P 500's growth.

And that number is growing. The truth is, investors regularly underestimate how much demand comes from abroad. More importantly, for large, multinational corporations that have already established a presence in their home markets, much of their future growth comes from abroad.

With that in mind, today we're looking at LinkedIn (NYS: LNKD) . We'll examine not only where its sales and earnings come from, but how its sales abroad have changed over time.

Where LinkedIn's sales were three years ago
Three years ago, LinkedIn was generating 78% of its sales from the United States.


Source: S&P Capital IQ.

Where LinkedIn's sales are today
Today, LinkedIn's reliance on the United States is shrinking, though it's by far still the company's largest market.


Source: S&P Capital IQ.

What's amazing is that while international sales are just 32% of LinkedIn's sales total, they're 172% larger than the company's entire United States sales total just three years ago! That's just one way of showing the enormous growth the entire company has undergone in recent years.

At the end of the day, LinkedIn is a tremendous business, but the main concern for investors is the company's sky-high valuation. While Facebook has managed to become the de facto social network across most of the world (aside from scattered markets like China and Russia), it's always been feared that hiring solutions could become a more local-oriented space instead of a global winner-take-all social network. However, as a quick point of reference, LinkedIn already has a higher percent of sales to foreign markets than hiring competitor Dice (NYS: DHX) , but it trails the international sales of Monster Worldwide (NYS: MWW) . Monster's nearly $500 million in international sales points to just how much revenue could be ahead of LinkedIn in the coming years.

LinkedIn's continued success in the international space shows that the company is managing to create a global professional network. As of last quarter, 60% of LinkedIn members resided outside the United States. In the coming years, that figure should only grow.

Keep searching for global opportunities
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At the time thisarticle was published Eric Bleeker owns shares of no companies listed above. The Motley Fool owns shares of LinkedIn. Motley Fool newsletter services have recommended buying shares of LinkedIn. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

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