Market Overview

Yahoo! Misses Q3 Expectations


Yahoo! Inc. (NASDAQ: YHOO) reported weaker-than-expected results for the third quarter on Tuesday.

The Sunnyvale, California-based company reported a quarterly net profit of $76.3 million, or $0.08 per share, versus a year-ago profit of $6.77 billion, or $6.70 per share. The year-ago quarter results were boosted by sale of shares in Alibaba Group. On an adjusted basis, the company earned $0.15 per share in the recent quarter.

Its GAAP revenue gained to $1.23 billion from $1.15 billion, while revenue, ex-TAC, declined to $1.0 billion from $1.09 billion. However, analysts were expecting earnings of $0.17 per share on revenue of $1.26 billion.

The average estimate among 200 Estimize users was for earnings of $0.16 per share and revenue of $1.02 billion.

Gross search revenue rose 2 percent year-over-year to $870 million for the third quarter, while gross mobile revenue climbed to $424 million from $345 million.

The number of paid clicks climbed around 5 percent year-over-year, while price-per-click slipped approximately 2 percent for the quarter.

GAAP display revenue climbed 14 percent to $509 million for the third quarter.

As of September 30, 2015, the company had $6.8 billion in cash, cash equivalents, and marketable securities, versus $10.2 billion as of December 31, 2014.

"Our Q3 results were largely within our forecasted expectations -- our GAAP revenue grew 7% year-over-year and our Mavens revenue grew 43%. As we move into 2016, we will work to narrow our strategy, focusing on fewer products with higher quality to achieve improved growth and profitability, said Marissa Mayer, CEO of Yahoo. In addition to sharpening focus within core business growth, our top priority is the planned spinoff of Aabaco Holdings. This is an important moment for the Company, and we continue to strive to complete the spin as quickly as we can."

Yahoo! expects Q4 sales, ex-TAC, of $920 million to $960 million, versus analysts' estimates of $1.33 billion.

Yahoo shares fell 1.16 percent to $32.45 in the after-hours trading session.

Posted-In: profitEarnings News Guidance


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