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Yahoo profit falls short of expectations

July 22nd, 2008 • Related • Filed Under

Yahoo today announced it’s financial numbers for Q2 2008. The company had revenues of $1.798 billion and operating Income - $101 million. Revenues were up 6 percent increase compared to the same period in 2007. Net income for the second quarter of 2008 was $131 million or $0.09 per diluted share compared to $161 million or $0.11 per diluted share for the same period of 2007 - a decline of 19%

The company provided further break down of its financial numbers by geographical segments. United States segment revenues for the second quarter of 2008 were $1,265 million, a 13 percent increase compared to $1,119 million for the same period of 2007. International segment revenues for the second quarter of 2008 were $534 million, an 8 percent decrease compared to $579 million for the same period of 2007. However, operating income was down 18% in the US and up 16% in international markets.

“Yahoo!’s transformation gained momentum in the second quarter as we announced new product initiatives and partnerships along with solid financial results,” said Sue Decker, president Yahoo! Inc. “We advanced our position with users by opening up Yahoo! through new innovative offerings like SearchMonkey and BOSS in search and have seen great improvements with Buzz in the freshness of content on our home page. Our commercial agreement with Google is another great example of our open strategy and we expect it will strengthen our competitive position as a leading provider of search and display advertising. On the advertising side, our growing list of major agency partners including Publicis, WPP, Havas and premier publishing partners including walmart.com, and CNET and Turner are great examples of our ability to be the partner of choice across search and display advertising. We remain confident that our efforts will lead to a stronger and more profitable Yahoo!.”

Yahoo’s stock was mostly unchanged after the news.

Yahoo has just emerged out of an impending board/CEO change in the upcoming shareholder meeting in August as it settled with billionaire investor Carl Icahn in exchange for 3 seats in the company’s board. This brings a bitter battle between Yahoo, Microsoft and Carl Icahn over Yahoo’s sale to Microsoft to a close. What Icahn brings to the board is something yet to be seen. Microsoft now has to search for another partner to tackle the Google headache.

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