A day after announcing Marissa Mayer as its new CEO, Yahoo
reported generally flat revenue and operating income and mixed usage numbers
for visitors, page views and search.
The sluggish revenue and income figures highlighted just how
far the company has to go to regain the kind of growth being seen by rivals
like Google and Facebook and the earnings call provided limited answers to how
the company plans to revitalize its operations.
The earnings were reported after the close of U.S. markets,
but after-hours trading was virtually flat (up 0.06% at 2:50 p.m. ET.)
Newly appointed CEO and former senior Google executive Mayer
was not on the call, which was conducted by CFO Tim Morse. He noted that this
was only her second day on the job and stressed that he would be unable to
answer questions about her future plans for the company.
Morse did, however, highlight some recently completed
alliances, new products and restructuring efforts as signs that the company was
improving its operations. "We feel good about this progress," he noted.
He also noted during the call that Olympics and upcoming
elections would boost usage, though the company declined to provide guidance
for the third quarter, citing the fact that Mayer needed to some time
to settle into her job.
Morse did note that Mayer brought "very strong" engineering
resume and a very successful record of introducing new products and that the
company had an extensive experience in the content arena.
"We need to be really good in technology" and "need to be
great in content," he said, which he called a "very powerful" combination when
they found the "right mix and balance."
Interim CEO Ross Levinsohn, who has now been twice passed
over for the top job, was also not on the call and executives did not mention
him during the call.
Non-GAAP revenue excluding traffic acquisition costs was
$1,081 million for the second quarter of 2012, flat compared to the second
quarter of 2011.
GAAP revenue under generally accepted accounting principles
was $1,218 million for the second quarter of 2012, a 1 percent decrease from
the second quarter of 2011.
Company reported that non-GAAP operating income excluding
restructure and other charges totaled $190 million, a figure that exceeded
their "midpoint of business outlook." Even so, that was slightly down from
non-GAAP of $191 million in the second quarter of 2011.
Income from operations on a GAAP basis that included
restructuring charges, however, showed a steep drop of 71% to $55 million in
the second quarter of 2012, compared to $191 million in the second quarter of
Non-GAAP earnings per share of $0.27, excluding
restructuring and other charges, was up 47% from a year earlier. With the
charges GAAP EPS was up 2% to $0.18.
"In the second quarter, non-GAAP earnings per share
exceeded consensus and both display and search revenue ex-TAC showed modest
growth," said Morse in a statement accompanying the financial release.
"We also moved aggressively with new strategic agreements with Alibaba and
Facebook and announced several new partnerships including CNBC, Clear Channel
In addition to sluggish revenue and income results,
operating metrics also showed little sign of a turnaround.
Unique worldwide visitors to Yahoo-branded sites grew 2%
over the last year.
But search page views as part of their alliance with
Microsoft dropped 13% and U.S. core search was down 17%, which was partially
attributable to the surge that occurred last year as part of the death of Osama bin Laden and the Royal Wedding.
Minutes spent at their communications and communities grew
8% over a year earlier but minutes spent on their media properties dropped 10%.