Yelp Inc. (NYSE: YELP) is out with its third quarter earnings, and the report is actually looking far better for the last quarter and pretty good on the guidance versus what some of the bears might have been expecting.

Net revenue was $143.6 million, which is 40% growth over the third quarter of 2014, and is almost $10 million higher than the $133.9 million just in the prior sequential quarter. Yelp had adjusted earnings per share (EPS) of $0.03 (or $2.7 million) and a net loss after GAAP items of -$0.11 EPS. Thomson Reuters had its adjusted earnings expectations of -$0.09 EPS and revenue expectations of $141.4 million.

For whatever it is worth, Roth Capital decided to initiate coverage on Yelp with a very unattractive “Sell” rating this same day of earnings, ahead of the report. Roth also gave Yelp a whopping $17.50 price target — versus a prior close of $22.90, and shares closed down 3.6% at $22.07 right before the earnings report hit.

Yelp did offer guidance ahead, for both the fourth quarter and for the full fiscal year 2015. Yelp shares were initially up on the news, and perhaps they guidance is being viewed as conservative because there is not any massive upside projected on revenue growth.

Fourth quarter revenue is expected to be in the range of $149.5 million to $154.5 million. That would be 38% growth at the midpoint versus a year earlier, but the Thomson Reuters consensus is already at $152.1 million. Also noted — Adjusted EBITDA is expected to be in the range of $20 million to $24 million. Stock-based compensation is expected to be in the range of $16 million to $17 million, and depreciation and amortization is expected to be 5%-6% of revenue.

The full year of 2015, revenue is expected to be in the range of $545.5 million to $551.5 million. That is 45% growth at the midpoint, but Thomson Reuters is already at $545.9 million. Also noted — Adjusted EBITDA is expected to be in the range of $72 million to $76 million. Stock-based compensation is expected to be in the range of $61 million to $63 million, and depreciation and amortization is expected to be 5%-6% of revenue.

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Yelp gave additional data points from the past quarter as follows:

• Adjusted EBITDA for the third quarter of 2015 was $12.5 million compared to $20.1 million in the third quarter of 2014.
• Cumulative reviews grew 35% year over year to approximately 90 million.
• App Unique Devices grew 39% year over year to approximately 20 million on a monthly average basis. Similar to the second quarter, app users were the most engaged users and approximately 70% of page views came from the mobile app.
• Local advertising accounts grew 37% year over year to approximately 104,2002.
• Yelp Platform transactions increased approximately 170% year over year.
• Net loss in the third quarter of 2015 was $(8.1) million, or $(0.11) per share, compared to a net income of $3.6 million, or $0.05 per share, in the third quarter of 2014.

Jeremy Stoppelman, Yelp’s CEO, said:

We executed well this quarter. Consumers are increasingly discovering our app, which represents approximately 70% of engagement across our entire ecosystem. We believe that our highly engaging app, combined with our native local advertising products that generate high ROI for our customers, strongly positions us to capture the large market opportunity.

Rob Krolik, Yelp’s CFO, said:

We are pleased with our 40% year over year revenue growth. We are investing in the business through our marketing programs and continued sales team growth as we work to achieve our goal of becoming the leading destination for consumers connecting with great local businesses.

Yelp shares were down 3.6% at $22.07 at the close, but the post-earnings reaction was up close to 6% at $23.32. Yelp’s consensus analyst price target was listed as about $33.00 and its 52-week range is $20.50 to $63.76.

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