If the YSM editorial team wasn't so friggin picky maybe search spend would be up....
Yahoo Net Profit Falls
Yahoo Inc. (Nasdaq:YHOO - news) reported on Tuesday an 11 percent fall in quarterly profit, missing Wall Street estimates as a new advertising system aimed at clawing back market share from Google has yet to take hold.
Shares of the Internet media company fell 7 percent in extended trading as Yahoo also forecast second-quarter revenue, excluding payments to affiliates, of $1.2 billion to $1.3 billion, slightly below analysts' forecasts ranging from $1.22 billion to $1.35 billion.
Investors also expressed concern Yahoo was unlikely to soon close a growing market share gap in Web search with leader Google Inc. (Nasdaq:GOOG - news).
Stifel Nicolaus analyst Scott Devitt said it looked like the impact from Yahoo's new Web advertising system, dubbed Panama, has been slower to materialize than investors hoped.
"It looks like they lowered the second quarter (forecast) a little bit," he added. "We would be buying Google on these results. I think it's a market share issue, not a sector issue."
Citigroup analyst Mark Mahaney said in a report ahead of the results that Yahoo's share of the U.S. Web search audience had continued to slip to 27.5 percent of the market, while Google posted fresh gains, to 48.3 percent, based on comScore data.
Yahoo said first-quarter net income fell to $142 million, or 10 cents per diluted share, compared with the year-earlier quarter of $160 million, or 11 cents per diluted share.
Wall Street analysts, on average, had expected a profit of 11 cents per share, according to Reuters Estimates.
Revenue rose 9 percent to $1.18 billion, excluding traffic acquisition costs -- the revenue cut Yahoo passes back to affiliated Web sites that run its advertising. The company previously cautioned that the first quarter would be the slowest-growing period of the current year.
The consensus revenue prediction from Reuters Estimates, excluding traffic acquisition costs, was $1.21 billion, with forecasts ranging from $1.17 billion to $1.24 billion.
"The quarter was a little lighter than expected, from the revenue perspective in particular," Cantor Fitzgerald analyst Derek Brown said.
"Our contacts indicated that Panama hadn't had a meaningful impact on their search spend," he said, referring to advertisers' willingness to increase spending on Yahoo search advertising using Panama.
"Through the quarter there seemed to be an increasing perspective that Panama was already driving a change in behavior and spending patterns. Our conversations did not seem to corroborate that," said Brown, who rates the stock a hold.
Yahoo shares fell to $29.69 compared with its close of $32.09 before earnings were announced.
Prior to the earning report, investors had bid up Yahoo shares by 25 percent this year, betting it would begin to see accelerated revenue growth in the second quarter, leading to significant revenue gains in the second half of 2007.
(Additional reporting by Michele Gershberg)
Yahoo net profit falls - Yahoo! News
Yahoo Net Profit Falls
Yahoo Inc. (Nasdaq:YHOO - news) reported on Tuesday an 11 percent fall in quarterly profit, missing Wall Street estimates as a new advertising system aimed at clawing back market share from Google has yet to take hold.
Shares of the Internet media company fell 7 percent in extended trading as Yahoo also forecast second-quarter revenue, excluding payments to affiliates, of $1.2 billion to $1.3 billion, slightly below analysts' forecasts ranging from $1.22 billion to $1.35 billion.
Investors also expressed concern Yahoo was unlikely to soon close a growing market share gap in Web search with leader Google Inc. (Nasdaq:GOOG - news).
Stifel Nicolaus analyst Scott Devitt said it looked like the impact from Yahoo's new Web advertising system, dubbed Panama, has been slower to materialize than investors hoped.
"It looks like they lowered the second quarter (forecast) a little bit," he added. "We would be buying Google on these results. I think it's a market share issue, not a sector issue."
Citigroup analyst Mark Mahaney said in a report ahead of the results that Yahoo's share of the U.S. Web search audience had continued to slip to 27.5 percent of the market, while Google posted fresh gains, to 48.3 percent, based on comScore data.
Yahoo said first-quarter net income fell to $142 million, or 10 cents per diluted share, compared with the year-earlier quarter of $160 million, or 11 cents per diluted share.
Wall Street analysts, on average, had expected a profit of 11 cents per share, according to Reuters Estimates.
Revenue rose 9 percent to $1.18 billion, excluding traffic acquisition costs -- the revenue cut Yahoo passes back to affiliated Web sites that run its advertising. The company previously cautioned that the first quarter would be the slowest-growing period of the current year.
The consensus revenue prediction from Reuters Estimates, excluding traffic acquisition costs, was $1.21 billion, with forecasts ranging from $1.17 billion to $1.24 billion.
"The quarter was a little lighter than expected, from the revenue perspective in particular," Cantor Fitzgerald analyst Derek Brown said.
"Our contacts indicated that Panama hadn't had a meaningful impact on their search spend," he said, referring to advertisers' willingness to increase spending on Yahoo search advertising using Panama.
"Through the quarter there seemed to be an increasing perspective that Panama was already driving a change in behavior and spending patterns. Our conversations did not seem to corroborate that," said Brown, who rates the stock a hold.
Yahoo shares fell to $29.69 compared with its close of $32.09 before earnings were announced.
Prior to the earning report, investors had bid up Yahoo shares by 25 percent this year, betting it would begin to see accelerated revenue growth in the second quarter, leading to significant revenue gains in the second half of 2007.
(Additional reporting by Michele Gershberg)
Yahoo net profit falls - Yahoo! News
