Yahoo turned in another dismal financial report in the second quarter, with revenue down and earnings flat.

Yahoo sales were $1.04 billion, excluding traffic acquisition costs, with earnings per share of 37 cents. Analysts had expected revenue to be $1.08 billion and earnings to be 38 cents.

Let’s be clear: It is hard in an ever-expanding Web market to do quite this badly. Thus, Yahoo CEO Marissa Mayer did not even try to pretend that the results were other than poor.

“Our top priority is revenue growth and by that measure, we are not satisfied with our Q2 results. … I believe we can and will do better moving forward.”

This is the understatement of the year.

On a bright note, Yahoo said it “requested and Alibaba Group agreed to an amendment to the share repurchase agreement that reduces the maximum number of shares that Yahoo is required to sell in connection with Alibaba’s initial public offering from 208 million shares to 140 million shares.”

Yahoo, as everyone knows, owns a large stake in the Chinese Internet juggernaut. (Praise be in Sunnyvale.)

That means it has to sell 68 million fewer shares, which could be worth billions of dollars for the company coffers now that Yahoo gets to hold onto them. Half of what it will sell, said Yahoo in a statement, will go back to its shareholders.

“We would like to take this opportunity to let our investors know that we are committed to return at least half of the after-tax IPO proceeds to shareholders, in line with our overarching commitment to maximizing shareholder value through prudent capital allocation,” said Yahoo CFO Ken Goldman.

In other words, Ken’s buying off investors for a time.

But here’s the rub I have been yammering on about for a long time, which is finally beginning to occur to investors: Yahoo said display advertising — one of its key businesses — dropped seven percent from the year before.

Most rivals are growing, which begs the question of how Mayer can turn around the company and spur growth. She has tried a lot of tricks, none of which has worked as yet.

Except convincing Alibaba to let Yahoo sell fewer shares. That, as it turns out, she gets an A for.


It is ironic that the best thing about Yahoo is Asian assets that they don't control and the worst performing part of the business is also, er... their Asian business. APAC declined once again by 8%, causing a drag on the overall business.

There are a bunch of leeches here who are driving this business down to the ground, step by step

Donald McIntyre
Donald McIntyre

I say break it up and sell te pieces to strategic owners who can grow the different services.


Yahoo has a lot of cash & value in its Alibaba stake.

A lot of very bright folks work there and care deeply.

The awful truth may be that key demos view the Yahoo Brand as old hat....and have no interest in the vast majority of content being pushed out.

Nothing lasts forever....and forever is a rapidly declining 10 year period... in tech.


Maybe they should change the logo again. That seemed to get some traction.


This provides the grist for an interesting thought problem that nobody from Yahoo (or Ms. Meyer's 'camp') will want to touch: Has the tenure of Ms. Meyer at Yahoo staunched the decline of Yahoo, or has it improved the situation?  I, for one, honestly can't answer, but Yahoo's overall decline is at least a decade old.


@TaiwanMonkey  If Marissa has any shame, she should resign for this performance.  At least those SVPs and VPs, who seem more interested in making money from Alibaba, should show have some shame. They should hide their faces in their *sses for missing every single goal on revenue. 

APAC is the worst region to work for and the leadership here has no credibility. These idiots in Taiwan brought a billion dollar business (6 years ago) to 700million now that continues to drop like a rock. 

It's funny how they listen to every problem (that even the furniture in office now is well-versed with) and exclaim "oh, really!!!", as if they are hearing for the first time


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