Yahoo Inc’s shares bounced in after-hours trading on Monday as the struggling Internet pioneer topped Wall Street expectations despite a slip in quarterly profit.
Yahoo reported quarterly profits of US$272 million, an 8 percent drop from a year earlier, but the figures were enough to make its stock jump more than 4 percent before dropping back near its regular trading day closing price.
The first full fiscal quarter overseen by chief executive officer Marissa Mayer has seen Yahoo post double-digit revenue gain on ads in online searches, where it was No. 1 before Google Inc surpassed it.
“It’s been an incredibly busy six months,” Mayer said during an earnings call with analysts. “We’ve got a lot of work ahead of us, but we are seeing key positive trends.”
Those trends included ebbing attrition of Yahoo employees around the world, better talent competing for jobs and buoyed worker confidence in the future of the California-based company, Mayer said.
For the second consecutive quarter, revenue from ads placed with search results on Yahoo pages has climbed.
Yahoo made a deal with Microsoft Corp in 2009 to have Bing power queries at its online properties, retaining control to personalize results while letting Bing do the “heavy lifting” of indexing and sifting Web content in the background.
The companies have been working to bolster search revenue, which they split under terms of the 10-year contract.
“There is a big push we want to make on search,” said Mayer, who was a high-level engineer at Google before leaving to take the Yahoo helm in July last year.
Last year, Yahoo saw its revenue rise for the first time in four years, Mayer said. The company reported annual revenue of US$4.98 billion for last year, an increase 2 percent from the previous year.
“During the quarter, we made progress by growing our executive team, signing key partnerships, including those with NBC Sports and CBS Television, and launching terrific mobile experiences for Yahoo Mail and Flickr,” Mayer said. “At the same time, we achieved tremendous internal transformation in the culture, energy and execution of the company.”
She expressed anew her intent to tune the company’s popular online properties and services to better connect with smartphones and tablet computers.
The Yahoo CEO said the company will focus on things people want on their smartphones without trying to compete in areas such as hardware and operating systems.
Mayer said the company’s top business challenges this year are to increase use of its properties service, improve its popularity outside of the US and have broader demographic appeal, “in roughly that order of priority.”