Yahoo earnings drop 18 percent to USD 131 million

23rd July 2008, Comments 0 comments

The company was hit by the slowing economy which reduced internet advertising and on increased spending to improve its search business.

23 July 2008

SAN FRANCISCO - Yahoo reported an 18 percent drop in second quarter profits Tuesday putting more pressure on the company in the aftermath of a shareholder revolt and the controversy over Microsoft's aborted attempt to buy the company.

The Silicon Valley internet services company said it earned USD 131.2 million (CHF 135.5 million), or USD 0.09 a share, compared to USD 161 million, or USD 0.11 a share a year ago. Revenue for the three months ended 30 June was USD 1.8 billion, compared with USD 1.7 billion in the same quarter in 2007.

Analysts said the company was hit by the slowing economy which reduced internet advertising, and on increased spending to improve its search business.

Yahoo founder and CEO Yahoo's chief executive, Jerry Yang, said the fruits of those investments would soon become apparent.

"Yahoo is executing against its strategy, and we believe is well positioned for long-term growth and maximizing stockholder value," Yang said in a statement.

"We are seeing validation that we have the right strategy as we continue to make transformational investments that position us to take advantage of pivotal trends driving growth on the Internet."

Yahoo released the results a day after announcing a settlement with corporate raider Carl Icahn, who had been trying to oust the board and revive the company's sale to Microsoft.

Microsoft had tendered a USD 47.5 billion bid for the company, but withdrew the offer after Yahoo demanded a higher price.

Under the agreement with Icahn, Yahoo agreed to expand the board by two members and give Icahn's representatives up to three seats on the board.

[dpa / Expatica]

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