(CNBC) — While Facebook and Google's parent Alphabet both surprised Wall Street with better-than-expected earnings, LinkedIn's Thursday afternoon forecast for its next year so dramatically disappointed that business network's shares plummeted over 40 percent on Friday.
So how can LinkedIn, once praised for its diverse revenue streams from three different businesses, take such a dramatic about-face? Why would the stock, already down about 20 percent over the prior year, lose so much more, when Facebook and Google soared on their results?
"They're fundamentally different companies; Google and Facebook are ad revenue businesses, and LinkedIn is 60 or 65 percent enterprise subscription revenue," said RBC analyst Mark Mahaney, who cut his rating on the company from Outperform to Sector Perform and slashed his price target to $156 from $300.
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