Tags: Yahoo | advertising | internet | earn

Yahoo Reports First Revenue Growth in Three Years

Tuesday, 17 Apr 2012 04:56 PM

Yahoo Inc. reported a modest uptick in first-quarter revenue, its first growth in three years, as new Chief Executive Scott Thompson spearheads the latest attempt to revamp the struggling Web company.

Finance chief Tim Morse told Reuters in an interview that better-than-expected pricing for its search ads helped the company increase its quarterly net revenue year-on-year for the first time since the third quarter of 2008.

But its core display advertising business declined 4 percent during the first quarter.

Also, much of the increase in quarterly profit came from its earnings in equity interests, which more than doubled year-on-year. Yahoo has a roughly 40 percent stake in major Chinese Internet player Alibaba Group.

"Their minority stake in their investments is generating more profit than their core business," said BGC Partners analyst Colin Gillis. "Here is the one piece that is always sad about Yahoo. Their income from operations was about $169 million and their earning and equity interest was about $172 million."

Shares of Yahoo, which closed Tuesday's regular trading session at $15.01, were trading up at $15.30 in after hours trading on Tuesday.

Yahoo said it earned net income of $286 million, or 23 cents a share, in the three months ended March 31, versus $223 million, or 17 cents a share, in the year-ago period. Analysts polled by Thomson Reuters I/B/E/S were looking for EPS of 17 cents.

It forecast net revenue in the second quarter of between $1.03 billion and $1.14 billion.

Once one of the Web industry's pioneering companies, Yahoo has seen its growth stunted in recent years amid competition from Google and Facebook.

Thompson, the former president of PayPal who took the reins in January, announced plans this month to lay off 14 percent of Yahoo's staff and reorganize the management structure.

Investors are looking for more details of Thompson's strategic plans during Yahoo's conference call with analysts on Tuesday afternoon.

"We know we have work to do. We aspire to being a higher growth and more profitable company, but it was a solid quarter," said Morse.

Morse said that the broader online advertising market is affected by economic uncertainty in Europe and parts of Asia and that industry growth rates will be more moderate than the past couple of years.

The company's net revenue, which excludes payments to partners, totaled $1.077 billion in the first quarter, compared to $1.064 billion in the year ago period. Analysts polled by Thomson Reuters I/B/E/S were looking for net revenue of $1.06 billion.

© 2017 Thomson/Reuters. All rights reserved.

 
1Like our page
2Share
415
2012-56-17
Tuesday, 17 Apr 2012 04:56 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved