Yahoo! (YHOO) Reports Drop In Profit, Alibaba Share Amendment
Shares of Yahoo! Inc. (YHOO) were up +1.02 or +3.06% to $34.28 per share in pre-market trading on Wednesday after the company announced its fiscal third quarter earnings following the market close on Tuesday. Yahoo! shares were down -0.62 or -1.82% to close at $33.38 in Tuesdayâ s regular trading session. In a separate release, Yahoo! announced it would not have to sell as many shares for Alibabaâ s upcoming IPO as it had previously expected.
Yahoo! owns a 24 percent stake in the Chinese based company set to go public. Daily Chart
Sunnyvale, California based Yahoo! Inc. is a global Internet corporation best known for its web portal and search engine. The company also provides a variety of other Internet services including Yahoo Mail, Yahoo News, Yahoo Finance, advertising, video sharing and social media, to name only a few. The company reported net income of only $296.7 million, or $0.28 per share, versus $3.2 billion, or $2.64 for the same period one year ago, adjusted profit came to $0.34 per share. Nevertheless, the analyst consensus for adjusted third quarter earnings called for $0.33 per share. Adjusted third quarter revenue was $1.081 billion, down from $1.09 billion for the same period one year ago. Analysts expected revenue of $1.082 billion. Yahoo CEO Marissa Mayer stated after the earnings release, "I'm very pleased with our execution, especially as we've continued to invest in and strengthen our core business." She continued, "In Q3, we launched new user experiences across many of our digital daily habits - Yahoo Screen, My Yahoo, Fantasy Sports, and more. Now with more than 800 million monthly users on Yahoo - up 20 percent over the past 15 months -- we're achieving meaningful increases in user engagement and traffic." For the fourth quarter, Yahoo expects adjusted revenue of $1.18 billion - $1.22 billion. The analyst consensus was for revenue of $1.25 billion. Yahoo expects full year revenue of $4.4 billion - $4.45 billion. Analysts were anticipating $4.8 billion. In related news on Tuesday, Yahoo! announced that the agreement in relation to its roughly 24 percent stake in Alibaba Group had been amended. The amendment changes the number of shares Yahoo! must sell when Alibaba goes public. The number of shares that Yahoo! is obligated to sell has been reduced from 261.5 million to 208 million. Yahoo! had agreed to sell the 261.5 million shares in May of 2012, and owns a total of 523.6 million shares of Alibaba Group. Yahoo! Chief Financial Officer Ken Goldman stated that, â
Published on Oct 16, 2013
By Jay Hawk