Yahoo Inc plodded through another disappointing performance in the second quarter, a familiar script that’s wearing thin with exasperated investors.
The results released on Tuesday are likely to intensify the pressure that had already been mounting on Yahoo chief executive Carol Bartz as she enters the final 17 months of her four-year contract.
In a sign of discontent, Yahoo shares sagged after the numbers came out, deepening a steep drop in Yahoo’s market value that has been driven during the past two months by uncertainty over a key investment in Chinese Internet company Alibaba Group (阿里巴巴).
Photo: AFP
The second quarter yielded a “mix of good, encouraging and, at the same time, unsatisfactory” developments, Bartz told analysts in a Tuesday conference call.
Bartz said the biggest problem stemmed from a shakeout in Yahoo’s advertising sales force that contributed to a revenue downturn in the US last month.
“We didn’t have enough sales people in front of the big clients,” she said.
The trouble is spilling over into the current quarter, prompting Yahoo to offer a revenue forecast for the July-September period that fell below analyst estimates.
Yahoo shares shed US$0.31, or more than 2 percent, to US$14.28 in Tuesday’s extended trading. The stock has plunged by more than 20 percent since Yahoo disclosed in May that Alibaba had spun off an online payment service called Alipay (支付寶). That move has cast doubt about the value of Yahoo’s 43 percent stake in Alibaba.
In Tuesday’s conference call, Bartz reiterated her confidence that Alibaba will fairly compensate Yahoo for the Alipay spinoff. She didn’t provide a timetable for reaching a resolution.
Yahoo earned US$237 million, or US$0.18 per share, during the three months ending last month. That’s an 11 percent increase from US$213 million, or US$0.15 per share, at the same time last year.
The earnings matched the projections among analysts surveyed by FactSet.
However, Yahoo’s revenue sank at a time when advertisers are pouring more money into the Internet.
Revenue totaled US$1.23 billion, a 23 percent decline from US$1.6 billion at the same time last year.
That comparison is misleading because Yahoo had to change the way it booked revenue to account for the Internet search partnership with Microsoft Corp. Among other things, the deal requires Yahoo to give Microsoft US$12 of every US$100 in ad revenue flowing from searches on Yahoo’s Web site.
Yahoo’s net revenue — the amount the company keeps after paying advertising commissions — totaled US$1.08 billion, down 5 percent from last year.
Yahoo’s net revenue for the second quarter fell about US$20 million below analyst forecasts and the mid-range of the company’s third-quarter revenue outlook is US$50 million below what analysts hoped.
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