Yahoo Profit Down, Jeremiah Factor Up

24 July 2008

SUNNYVALE, California: Confounding the ultra-gloomy forecasts of some Wall Street Jeremiahs, Yahoo on Wednesday posted a set of Q2 numbers firmly in the black – despite an 18% slide in net income to $131.2 million (€82.98m; £65.79m). Revenue rose 5.9% to $1.8 billion.

"It has been a very challenging environment for our company and employees," said Yahoo ceo Jerry Yang (pictured above). He added, apropos the many external distractions during the quarter: "But results were strong. We feel good about that."

A contributing factor was the relative strength of display advertising which defied the general ad malaise to rise 12% year-on-year, excluding the costs of commissions to partners.

Despite which the Wall Street whiners are ever-harder to please. 

Lehman Brothers analyst Doug Anmuth grumbled at the lack of profits growth, observing that Yahoo "needs new initiatives to click". "A lot is riding on how it ends its fiscal year," he added.

Meantime, Yang waved an olive sprig at the man who may still prove his nemesis, the corporate raider Carl Icahn, who holds ten million Yahoo shares with options on a further 49m.

Icahn, who is shortly to join the Yahoo board along with two of his nominees, "is a very different person and institution when he is not trying to take over the company," Yang said. "He is constructive and will be going after shareholder value."

Data sourced from Wall Street Journal Online; additional content by WARC staff