While everyone was busy admiring the performance of Apple during the second quarter of this year, other companies were trying to do some business as well. Among those was Yahoo. While Apple seems to trip over good news Yahoo has to work hard to keep itself out of the news for the wrong reasons. Yesterday it reported its Q2 numbers and the folks over at ZDNet filled the world in on some better than expected results
The company reported second quarter net income of $141.4 million, or 10 cents a share, on revenue excluding traffic acquisition costs of $1.14 billion. Wall Street was expecting Yahoo to report earnings of 8 cents a share on revenue of $1.14 billion. Non-GAAP second quarter earnings were 16 cents a share, on par with expectations (statement). In the same quarter a year ago, Yahoo reported earnings of 9 cents a share on revenue of $1.34 billion.
Things must be going reasonably well for the proposed Microsoft-Yahoo ad sales deal because Yahoo CEO Carol Bartz, who is more known for caustic remarks about competitors, actually played nice. She was even able to scare up a compliment of sorts regarding Microsoft’s bing
I actually think Bing is a good product. I think they’ve done a good job, but unfortunately they are only a month into it. I think Microsoft should be given kudos for Bing.
Maybe there is a vessel making its way to Yahoo headquarters that has the “boatloads of money” Bartz said it would take for the ice to melt between the search engine wannabes.
Bartz also made mention of the new home page design as she referred to the home page as the ‘big dog’ of Yahoo. There was recognition that some of the ads that Yahoo runs can hamper the user experience and there will be changes made. There are also marketing dollars set aside for the 3rd quarter rebranding push which got underway yesterday with the early roll out of the new hoe page.
While meeting and / or beating expectations can be good, they must have been set pretty low because on the pure numbers side of the coin Yahoo saw decreases in many major areas.
- Marketing services revenue fell 13 percent and fees fell 8 percent from the second quarter a year ago.
- Owned and operated revenue was $858 million, down 16 percent from a year ago. Search advertising revenue fell 15 percent with display advertising down 14 percent.
- Affiliate sites revenue was $520 million for the second quarter, down 9 percent. The decrease was due to “a shift to lower yielding inventory.”
- Free cash flow was $266 million, down 15 percent from a year ago.
To finish on a brighter note Yahoo has $4.2 billion in cash. Something must be going right.