Yelp (NYSE:YELP) has continued to grow at a rapid pace since its IPO, and has expanded into various new international markets like Norway and Denmark. Last week, it also expanded into Finland, and launched yelp.fi, targeted specifically at its Finnish user base. It also launched its iPhone and Android apps in Finland and Yelp for Business Owners, its free set of tools.  
Yelp has a huge presence in the U.S. and has been trying to expand into international markets to continue its growth spree. It has launched into several markets worldwide, including Canada, UK, Ireland, France, Germany, Austria, The Netherlands, Spain, Italy, Switzerland, Belgium, Australia, Sweden, Denmark, Norway and now Finland.
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We expect international expansion to drive the next phase of growth for Yelp. Though there might be a decline in the average revenue generated per local business or average ad revenue per user, we expect that to to be outweighed by the higher growth in Yelp’s user base and active local business accounts.
Yelp also upgraded its iPad app to add additional features like a “About Me” section for users where they can quickly view their profile, reviews, check-ins and tips, and a feature called business photos which list actual images of the business alongside their search results. Yelp’s increasing mobile audience could drive an increasing amount of its profits going forward, so any feature upgrades that could help it attract more users or make the service more usable add to its value.
Yelp is one of the largest online business search, review and recommendation service, which enables consumers to access ratings and read reviews and opinions about local businesses like hotels, restaurants, salons, dentists and mechanics on their website. Local businesses are reviewed and rated by contributors. Yelp generates revenue mainly from local business advertising, display advertising and from additional services like Yelp deals, and deals with reservation services like OpenTable (NASDAQ:OPEN). It competes primarily with other online business review services like Google (NASDAQ:GOOG) Places, Yahoo (NASDAQ:YHOO) Local, Angie’s List, CityLocal and Gumtree; display advertising players like Google, Yahoo, Facebook and AOL (NYSE:AOL); and daily-deal sites like Groupon (NASDAQ:GRPN) and LivingSocial.
We currently have a $10 Trefis price estimate for Yelp, which stands at nearly half its current market price.Notes: