Tags: yahoo | profit | earnings | mayer

Yahoo Profit Beats Estimates as Mayer Begins as Chief Executive

Tuesday, 17 July 2012 05:17 PM

Yahoo Inc. reported profit that exceeded analysts’ estimates, bolstering the turnaround effort that started under newly hired Chief Executive Officer Marissa Mayer.

Second-quarter earnings, excluding some items, were 27 cents a share, beating the 23 cent average estimate compiled by Bloomberg. Net income attributable to the company fell to $226.6 million, or 18 cents a share, from $237 million, or 18 cents, a year earlier.

Investors will look to Mayer, the fifth CEO in three years at the biggest U.S. Web portal, to boost revenue and fend off competition for users and advertisers from Facebook Inc. and Google Inc., her former employer. Yahoo’s share of U.S. spending on display ads is expected to fall to 9.1 percent this year from 11 percent in 2011, trailing Google and Facebook, according to EMarketer Inc.

“She’s inheriting a tremendous position,” said Ron Josey, an analyst at ThinkEquity LLC in New York, who rates the stock a hold. “It is possible for Yahoo to turn this around?”

Second-quarter revenue, excluding sales passed on to partner sites, was little changed at $1.08 billion, Sunnyvale, California-based Yahoo said in a statement. That compares with the $1.1 billion average analysts’ projection compiled by Bloomberg.

Yahoo was little changed in extended trading, and the shares fell 0.3 percent to $15.60 at the close in New York. The stock has dropped 3.3 percent this year.

Mayer, a 13 year Google veteran, takes the helm at Yahoo today. She replaces Ross Levinsohn, who ran the Sunnyvale, California-based company on an interim basis after Scott Thompson resigned in May over inaccuracies in his resume. Thompson took over in January from Tim Morse, who became interim CEO in September. Morse followed Carol Bartz, who was fired last year.

Yahoo’s overall sales tumbled 21 percent to $4.98 billion last year as users devoted less time on the service. Visitors on average spent less than two hours, 20 minutes on Yahoo pages in May, compared with more than six hours for Facebook, according to ComScore Inc.

Mayer, who joined Google as its 20th employee and its first female engineer, is credited with maintaining the company’s Spartan home page for a decade and overseeing such products as Gmail, Google News, and image, book and product search. In 2010, she became vice president of local, maps and location services.

Mayer also brings technical prowess to the CEO position. She’s an engineer and patent holder who earned a bachelor’s degree in symbolic systems and a master’s degree in computer science from Stanford University.

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Tuesday, 17 July 2012 05:17 PM
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