Yahoo plods along, cost-cutting raises profits while revenue falls

Yahoo Inc. plodded through another sluggish performance in the second quarter. The disappointing results, released Tuesday, may intensify pressure on Yahoo CEO Carol Bartz, who has spent the past 2.5 years trying to turn around the internet company. Yahoo earned $237 million, or 18 cents per share, during the three months ending in June. That’s […]

Yahoo Inc. plodded through another sluggish performance in the second quarter.

The disappointing results, released Tuesday, may intensify pressure on Yahoo CEO Carol Bartz, who has spent the past 2.5 years trying to turn around the internet company.

Yahoo earned $237 million, or 18 cents per share, during the three months ending in June. That’s an 11% increase from $213 million, or 15 cents per share, at the same time last year.

The earnings, bolstered by cost cutting undertaken since Bartz’s January 2009 hiring, matched the projections among analysts. But Yahoo’s revenue sank at a time when advertisers are pouring more money into the internet.

Revenue totalled $1.23 billion, a 23% decline from $1.6 billion at the same time last year.

That comparison is misleading because Yahoo had to change the way it booked revenue because of an internet search partnership with Microsoft Corp. that kicked in after last year’s second quarter.

Yahoo’s net revenue–the amount the company keeps after paying advertising commission–is a better indication of how the company is faring against competitors such as internet search leader Google Inc. and Facebook, the owner of the web’s trendiest hangout.

Net revenue totalled $1.08 billion, down 5% from last year. The drop looks even worse compared with what’s going on at internet search leader Google, whose net revenue surged by 36% in the second quarter. As a privately held company, Facebook doesn’t release its financial results, but research firms tracking the internet ad market say the social network is gaining a bigger piece of marketing budgets.

If not for the effects of the Microsoft search deal and the closure or sale of some services since last year, Yahoo said its net revenue would have been 1% higher than last year.

No matter how the figures were sliced, Yahoo’s net revenue fell about $20 million below analyst forecasts.

Media Articles

30 Under 30 is back with a new name, new outlook

No more age limit! The New Establishment brings 30 Under 30 in a new direction, starting with media professionals.

As Prime Minister, Kellie Leitch would scrap CBC

Tory leadership hopefuls are outlining their views on national broadcaster's future

‘Your Morning’ embarks on first travel partnership

Sponsored giveaway supported by social posts directed at female-skewing audience

KitchenAid embraces social for breast cancer campaign

Annual charitable campaign taps influencers and the social web for the first time

Netflix debates contributions with Canadian Heritage

Netflix remains wary of regulation as some tout 'Anne' and 'Alias Grace' partnerships

Canadians warm up to social commerce

PayPal and Ipsos research shows "Shop Now" buttons are gaining traction

Online ad exchange AppNexus cuts off Breitbart

Popular online ad exchange bans site for violating hate speech policy

Robert Jenkyn is back at Media Experts

Former Microsoft and Globe and Mail exec returns to the agency world

2016 Media Innovation Awards: The complete winners list

All the winning agencies from media's biggest night out!