As of yesterday (Aug. 3), Yelp has officially announced that it will be selling Eat24 to Grubhub for price of $287.5 million in cash. Yelp also announced this as the beginning of a long-term strategic partnership that will see it integrate online ordering from restaurants on Grubhub’s site.
The market liked that news — particularly taken in tandem with Yelp’s better than expected quarterly earnings — and pushed Yelp’s stock price up 18 percent overnight.
Grubhub, on the other hand, got the opposite result from the same reaction — its shares were down 7 percent on the announcement despite the fact that revenue was up by 32 percent during the second quarter to 1$59 million, a slight beat on the $158 million forecast.
Yelp’s Q2 revenue was up 20 percent to $209 million, well above the $205 million expected by analysts, on average.
Net income clocked in at $7.6 million — a big beat on the $400,000 a year earlier. Earnings per share were 9 cents per share, versus 1 cent per share during the same time period a year ago.
“It’s a sign that execution is back on track,” analyst Matthew Thornton of Suntrust Robinson Humphrey Capital Markets said.
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For Q3, Yelp said it expects revenue of $217 to $222 million. Analysts have been expecting $219.67 million.
