Thu, Jan 26, 2012 - Page 5 News List

New Yahoo CEO promises action after dreary Q4


Yahoo’s new chief executive Scott Thompson promised urgent action to turn the company around on Tuesday after it reported another quarter and year of falling income and profits.

Thompson, named Yahoo CEO only on Jan. 4, said the Web giant needed to move quickly to exploit its huge bank of user data to regain market share, especially in display ads where it has lost ground.

The former PayPal chief stressed that Yahoo needed to become an agile and “disruptive” force technology-wise to claw back Internet turf and advertising dollars lost to competitors like Google and Facebook.

“Yahoo is fundamentally both a media company and a technology company. We need to be great at both,” he told analysts in a conference call.

“We will get speed back into the equation and move aggressively,” Thompson said.

Yahoo fourth-quarter net earnings declined 5.3 percent from a year earlier, as revenues dropped 13 percent.

Earnings from core operations increased a solid 10 percent during the quarter to US$242 million, the company said.

However, net income fell to US$296 million, down from US$312 million a year earlier, with adjusted earnings per share stable at US$0.24.

Revenues excluding traffic acquisition costs — the commissions Yahoo shares with partners in the search ads business — were 3 percent lower.

For the year the results were similar. Revenues after commissions were down 5 percent, partly blamed on the cut Microsoft takes from its shared search operations.

Operations income was up 3.5 percent for the year to US$800 million, but net earnings fell 14.6 percent to US$1.06 billion, and earnings per share for the year fell to US$0.82 from US$0.90.

According to eMarketer, Yahoo’s overall share of online ad revenues dropped last year to 11.0 percent from 13.3 percent in 2010, while market leader Google boosted its share to 40.8 percent from 38.5 percent.

Microsoft and Facebook also picked up ground at Yahoo’s expense.

The biggest shortfall was in lucrative display advertising, the company said, blaming poor performance in the all-important North American market.

Thompson declined to provide details on Yahoo’s talks with its Japanese and Chinese partners over the possible disposal of its valuable Asian assets.

For more than a year the company has been weighing selling off those assets to benefit shareholders frustrated by the company’s falling share price.

Some believe that the resignation from the Yahoo board earlier this month of company co-founder Jerry Yang (楊致遠) will open the way for such asset sales.

However, Thompson would only say that “we are in active discussion with our Asian partners.”

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