EFTA01797165

From: Richard Kahn Sent: Friday, April 29, 2016 9:36 AM To: Jeffrey Epstein Subject: Fwd: Linkedln Corp: Still a Show-me Story Richard Kahn HBRK Associat=s Inc. Begin forwarded message: From: "Morgan Stanley" Date:=/b> April 29, 2016 at 3:34:36 AM EDT To: Subject: Reply-To: < Brian Nowak, CFA — Morgan Stanley I EFTA_R1_00133571 EFTA01797165 April 29, 2016 7:28 AM GMT Results better than feared, but Talent Solutions=Ex-Lynda growth slowed the most it has in our 2 year history and our full-=ear EBITDA estimates are unchanged. We remain EW until we see evidence of=some of LNKO's investments bearing fruit of materially faster TS growth and=earnings revisions. Impact on Thesis: LNKD posted 2% better than expected revenue in 10:16, as T=lent Solutions and Marketing Solutions came in 2%/5% better than expected. W=thin Talent Solutions, —70% of the beat was driven by Lynda, which came in a= $55mn (14% or $7mn better than we expected). Talent Solutions revenue e=-Lynda of $502mn was —1% better than expected (an encouraging sign)...but, e=-FX Talent Solutions revenue (ex-Lynda) still decelerated to 30% YoY growth= This 700bp sequential deceleration is the largest we have seen in the 2 y=ars of history we have (See Exhibitl). As written in Linkedln Corp: A Pl=tform at the Crossroads, absent traction with some of LNKD's investment ini=iatives, we expect this business to continue to slow going forward. This, i= our view, limits LNKD 's earnings upside and multiple investors are willin= to pay for the company. Indeed, despite better than expected revenue,=$222mn of 10:16 non- GAAP EBITDA was 1% ($3mn) below us. That said, it was=13% ($25mn ahead of the Street and 17%($32mn above guidance). Management f=owed this through 10:16 EBITDA upside to full year 2016, raising full-yea= 2016 EBITDA guidance by $33mn to a range of $985mn-$1,005mn. Management re=rained from raising guidance any more, calling out the incremental investme=t in "monetization products and quota reps." As explained above, in our vie=, it is important that LNKD continues to invest in these new initiatives to=try to drive faster TS customer and spend/customer growth. 2016E EBITDA Un=hanged, Maintain EW, $125PT: Updating our model, our —$1.0bn of 2016 non=GAAP EBITDA is roughly unchanged. We are 2.6% above the top-end of full•ye=r 2016 EBITDA guidance. W Click here <http://linkback.morganstanley.com/web/sendlink/=ebapp/f/rj8i0n5s-3pgd-g000-.3641- 005056028304?store=1&d=UwBSZXNIYM=F9NUwahMjk2MDcOMiOwYmRml.TExZTYtYWQzMi050WM5YmOlYTMyYTY% 3D&user=44zaln=asltj8.0&_gda_=1525073676_2176bbd5a61455a4959b5316c15d2695> This alert is sent from: Andrew Atlas, =20 You received this because you asked to be=alerted to: LINKEDIN CORPORATION Please contact your FA if you want to unsubscribe from the alert=. Disclosures: Please see the full report for risks, disclosures and oth=r important information. Important disclosures regarding the relationship between the companies that a=e referenced in Morgan Stanley research and Morgan Stanley Wealth Managemen= research are available on the Morgan Stanley Wealth Management disclosure w=bsite at https://www.morganstanley.com/online/researchdisclosures <https://www.morganstanley.com/online/researchdisclosure=> . 2 EFTA_R1_00133572 EFTA01797166 Morgan Stanley Wealth Management Not Acting as Municipal Advisor Morgan Stanley Wealth Management is not acting as a municipal advisor t= any municipal entity or obligated person within the meaning of Section 15B=of the Securities Exchange Act (the "Municipal Advisor Rule") and the opini=ns or views contained herein are not intended to be, and do not constitute,=advice within the meaning of the Municipal Advisor Rule. Copyright The copyright in materials provided by Morgan Stanley is owned by Morga= Stanley & Co. LLC. Morgan Stanley Wealth Management is the trade name o= Morgan Stanley Smith Barney LLC, a registered broker-dealer in the United S=ates. 3 EFTA_R1_00133573 EFTA01797167