Yahoo 1Q Sales Disappoint, Shares Tumble

By Jennifer Booton Technology FOXBusiness


Yahoo (YHOO) posted much better-than-expected first-quarter profits late Tuesday; however, sales fell short and ad revenues weakened, sending the Silicon Valley tech giant's shares into a tailspin in extended trade. 

Continue Reading Below

The Sunnyvale, Calif.-based company, which revamped its website and halted its work-from-home policy last quarter in an aggressive move by CEO Marissa Mayer, reported net income of $287.5 million, or 35 cents a share, down from $390 million, or 35 cents a year ago.

Excluding one-time items and acquisition costs, Yahoo said it earned 38 cents a share, topping average analyst estimates of 24 cents in a Thomson Reuters poll.

Revenue for the three-month period climbed slightly to $1.14 billion from $1.2 billion. However, excluding traffic acquisition costs, sales fell 11% to $1.07 billion, missing the Street’s view of $1.1 billion.

Yahoo said cost-per-click fell roughly 7% year-over-year, excluding Korea and adjusted display revenue slumped 11%. The company’s shares skidded 4% after hours to $22.93.

More On This...

The announcement comes roughly a year into Mayer's tenure as chief executive, following a revolving door on Yahoo's C-Suite over the last few years. She has been working to turn the company around, including launching a major update to

Continue Reading Below

“We saw continued stability in our business, strengthened our team, and started the year with fast execution against our products and partnerships," Mayer said in a statement. "I'm confident that the improvements we`re making to our products will set up the company for long-term growth."

What do you think?

Click the button below to comment on this article.