IP Democracy: Yahoo! Still Not Back on Track
Yahoo! issued its Q1 07 earnings report today and the news wasn’t good. After a wobbly 2006, Yahoo! had promised to turn things around in 2007 with a new improved ad system called Panama. Based on Q1 07 results, the company really has to go gangbusters through the remaining three quarters of this year.
Although revenues advanced by 7% year-over-year to $1.7 billion, they slipped by 1.7% sequentially. More troublesome was an 11% drop in profits, which decreased from $159.9 million to $142.4 million year-over-year as the growth in operating expenses exceeded the rise in revenue.
Although international revenues are on the upswing, U.S. revenues stayed flat at $1.1 billion year-over-year and actually slipped by 1.4% sequentially.
Another sign of chronic sluggishness at Yahoo!: Page views shot up by 22% year-over-year, and by 16% sequentially, even as revenues grew by only 7%. As Larry Dignan points out, this might mean Yahoo! has inventory it can’t monetize properly.
Larry also says that Yahoo!’s earnings call for analysts didn’t go well. (No chance to listen to it myself.) He said that Semel didn’t sound polished while CFO and most-important-executive-behind-Semel Sue Decker “seemed off her game.”
Two years ago, Semel seemed so in control during these type of events and, despite the barbs emanating from Silicon Valley-types, so strategically sound. That hasn’t been the case during the last few earnings calls and investor presentations that I’ve caught, and I didn’t feel that it merited mentioning —- after all, it’s kind of a weird thing to say. It’s an unscientific, non-quantifiable conclusion that could have been just in my head.
Apparently not. Owen Thomas at Business 2.0 has a run-down of the earnings call replete with commentary on the performance of the top two execs. He also thinks the top two execs weren’t performing well on the call.
| Yahoo! Selected Financial and Operating Data ($ in 000s except per user) | |||||
| Q106 | Q206 | Q306 | Q406 | Q107 | |
| Revenues | $ 1,567,000 | $ 1,575,854 | $ 1,580,322 | $ 1,702,448 | $ 1,671,850 |
| Cost of revenues | $ 657,943 | $ 645,767 | $ 681,120 | $ 690,893 | $ 713,637 |
| Total operating expenses | $ 707,900 | $ 700,500 | $ 696,862 | $ 703,728 | $ 789,186 |
| Net income | $ 159,859 | $ 164,300 | $ 158,529 | $ 268,673 | $ 142,424 |
| Revenue by Group | |||||
| Marketing Services | $ 1,380,854 | $ 1,386,245 | $ 1,370,374 | $ 1,489,734 | $ 1,468,619 |
| Fees | $ 186,201 | $ 189,609 | $ 209,948 | $ 212,714 | $ 203,231 |
| Total | $ 1,567,055 | $ 1,575,854 | $ 1,580,322 | $ 1,702,448 | $ 1,671,850 |
| Revenue by Segment | |||||
| United States | $ 1,097,038 | $ 1,070,134 | $ 1,054,048 | $ 1,144,702 | $ 1,100,757 |
| International | $ 470,017 | $ 505,720 | $ 526,274 | $ 557,746 | $ 571,093 |
| Unique Users (mil.) | 402 | 412 | 418 | 423 | 477 |
| Active Registered Users (mil.) | 208 | 208 | 215 | 219 | 238 |
| Premium Users (mil.) | 13.3 | 14.3 | 15.5 | 16.3 | 16.5 |
| Ending Daily Avg. Page Views (bil.) | 3.8 | 3.9 | 4.0 | 4.0 | 4.6 |
| Revenue ex-TAC per Average Unique User Per Month | $ 0.95 | $ 0.92 | $ 0.90 | $ 0.97 | $ 0.88 |
| Worldwide Headcount | 10,098 | 10,500 | 11,000 | 11,400 | 11,700 |
Posted by Cynthia Brumfield on April 17, 2007 6:54 PM to IP Democracy