Marissa Mayer 'Not Satisfied' With Yahoo Quarterly Results
Yahoo's revenue troubles continue.
The Sunnyvale tech firm saw revenue after ad commissions, the metric that most analysts focus on, drop 3 percent to $1.04 billion during the second quarter, slightly lower than the $1.08 billion that analysts were expecting, driven by a decline in display ad revenue.
The company's earnings were so dismal that Yahoo CEO Marissa Mayer didn't try to put a positive spin on them.
"Our top priority is revenue growth and by that measure, we are not satisfied with our Q2 results," she said Tuesday. "In Q2, we saw display revenue decline, further highlighting the fact that we need to work faster to ameliorate the negative trends. I believe we can and will do better moving forward."
Yahoo's adjusted earnings also fell just short of Wall Street's estimates at 37 cents per share.
The company's stock got a short reprieve following the earnings news thanks to Alibaba Group. Yahoo owns a 24 percent stake in Alibaba, which is preparing to go public. But Yahoo's stake in the business won't shrink as much as is could have since Alibaba has approved a reduction in the number of share that Yahoo is required to sell from 208 million to 140 million.
Yahoo will receive a significant cash windfall following Alibaba's IPO and the company said Tuesday that it will return at least half of the after-tax IPO proceeds to investors. The news gave Yahoo stock a boost, sending shares up 39 cents, or about 1 percent, to $35.99 during after hours trading on the Nasdaq. The boost didn't last long, however, by the time the company's call with investors ended, shares were trading down less than 1 percent.
During a conference call with investors Tuesday afternoon, Mayer stressed that the company's transformation will take time.
"Transformation is not a singular event," she said. "It's a series of events and quarters, some more challenging than others and some more successful than others."
Mayer also touched on ways in which she is looking to revive Yahoo, including the company's original programming strategy on streaming video service Yahoo Screen. Although she admitted that the "reinvention of our video business is still in the early days," she also expressed enthusiasm for the company's recent pickup of Community's sixth season, noting that she is "thrilled by the positive response from Community's passionate following."