Overall, it has been a great day for earnings, but the last of today's bunch ended on a low note. Yahoo missed expectations, but not by much. Revenue was expected to be $1.09 billion, with earnings per share at $0.38. Instead, revenue was $1.04 billion, with $.37 per share. This is about three percent down from the second quarter of 2013.
CEO Marissa Mayer was not amused:
Our top priority is revenue growth and by that measure, we are not satisfied with our Q2 results. While several areas showed strength, their growth was offset by declines. Yahoo Search, for example, had a strong quarter, growing 6% year-over-year on a revenue ex-TAC basis and 19% year-over-year in search click-driven revenue. Our social, mobile, video and native areas also grew with significant momentum, collectively gaining nearly 90% year-over-year. However, display remains an area of investment and transition. 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. Overall, I remain confident in Yahoo's future, our strategy, and our return to long-term growth."
While this is certainly not great news, Yahoo's stock did not plummet. This is due to an announcement about Alibaba — the Chinese e-commerce site that Yahoo has a major stake in — from CFO Kevin Goldman:
We are pleased to announce today that we have entered into an amendment to the share repurchase agreement with Alibaba, reducing the number of shares that Yahoo is required to sell at the IPO from 208 million shares to 140 million shares. In addition, we are aware that there has been much discussion around the allocation of the Alibaba IPO proceeds.
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."
At time of publishing, stock was up 2.11 percent to 36.36 in after-hours:
This article is from the archive of our partner The Wire.