Yahoo Stock Falls as CEO Revisits Plan to Return Some $4 Billion to Shareholders

2012-25 REP Marissa Mayer P

Yahoo's new CEO, a longtime Google exec, becomes one of Silicon Valley's most powerful female figures even as she faces big challenges in crafting a content strategy for the troubled web giant.

Marissa Mayer, named chief executive three weeks ago, is mulling what to do with money the company might get from selling its stake in Alibaba.

Shares of Yahoo were off as much as 4 percent during Thursday’s after-hours trading session as the company disclosed it might renege on its intention to return billions of dollars to stockholders.

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Yahoo said in a regulatory filing that recently installed CEO Marissa Mayer is reviewing lots of the company’s plans, including its “capital allocation strategy” and “previously announced plans" for returning to shareholders the money it would make from selling its stake in Alibaba.

Yahoo owns 40 percent of the Chinese Internet company and had planned to sell about half of that for $7.1 billion, netting Yahoo about $4.2 billion after taxes. Before Mayer was named CEO last month, the company planned on returning “substantially all” of that money to shareholders.

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Shares of Yahoo fell 1 percent during the regular session Thursday to $16.01 before sinking another 4 percent after the closing bell.

The “review process” initiated by Mayer, according to the filing revealed Thursday, “may lead to a re-evaluation of, or changes to, our current plans, including our restructuring plan, our share repurchase program, and our previously announced plans for returning to shareholders substantially all of the after tax cash proceeds of the initial share repurchase under the Share Repurchase and Preference Share Sale Agreement we entered into on May 20, 2012, with Alibaba.”