Stephen Logan

Yahoo Record First Quarter Revenue Increase

21st Apr 2010 News, Industry News 2 minutes to read

Whilst Yahoo revenue has grown by 1 percent and advertising income improved by 3 percent, the latest figures have done little to comfort investors.

Usually an increase in revenue is greeted with optimism and excitement. However, Yahoo’s announcement of a 1 percent rise in fortunes saw share prices fall and market confidence take a dip. So why all the ambivalence?

Well, first of all, Yahoo had predicted a 3 percent increase for this quarter; so the $160 million revenue increase was a long way shy of their target. Confidence slipped as a consequence, leading to a 65 Cent slip in share price.

Secondly, Yahoo has been very public in how frugal they have been. Carol Bartz has made it her mission to get the Yahoo ship sailing again; in doing so, she has stripped it back, got rid of much of the excess ballast and cut advertising costs [see: Yahoo Continue Cull with Yahoo Publishing Network Closure]. She also signed that search agreement with Microsoft, taking away search engine responsibility from the company [see: Yahoo & Microsoft Close to Striking Search Deal]. But for all that downsizing, asset stripping and fresh investment (Microsoft paid Yahoo $78 million in the first quarter), they still only grew 1 percent.

It is also unfortunate that these otherwise positive figures came out following Google’s. The 3 percent rise in advertising income is, by normal standards, pretty decent. Sadly, when compared to Google’s 21 percent leap in the same period, a little of the gloss is lost.

No one will argue that Yahoo is a company in transition. Their YaBing partnership will begin to take effect in the not too distant future and their focus will shift from search to search advertising and other avenues of income. Carol Bartz herself has barely got her feet under the table, so any kind of upturn in fortunes should be seen as positive.

The slump in online advertising revenue hit everybody hard. The recession saw budgets getting squeezed and paid search getting the brush off from many companies. Now though, we are in recovery [see: The Internet is Now Advertising Medium of Choice in the UK].

People have more money to invest. They see opportunities online and are willing to splash the cash again. The challenge for Yahoo, as it is for all advertising hosts, is to make that newly found confidence pay. The 3 percent rise in ad revenue is a start, but they will need to do more if they are to appease shareholders and industry analysts.

Their future might still be in limbo [see: Has Yahoo Jumped the Shark (Following AOL and Netscape)], but there appears to be plenty of fight left in Yahoo yet. Whilst they are profitable, they are functional. If the YaBing agreement takes away some of Google’s global superiority, surely advertising revenue will follow. With this comes the opportunity to invest and with investments comes future hope for bigger revenue windfalls.

Share this post


What do you think?

London cityscape
Stacey Cavagnetto

The Best Digital Marketing Agencies in London

Stacey Cavagnetto
18th Jan 2023
Marketing Strategy
Gary Hainsworth

How To Write Ranking Content In 2023

Gary Hainsworth
16th Jan 2023
SEO Blog

Digital Ideas Monthly

Sign up now and get our free monthly email. It’s filled with our favourite pieces of the news from the industry, SEO, PPC, Social Media and more. And, don’t forget - it’s free, so why haven’t you signed up already?

Free Digital Marketing Audit

Are you a UK business that needs some expert help to uncover what’s holding your digital marketing back? Let us show you for free!


Call us on 0330 353 0300, email or fill out our Contact Form.

Map of Hampshire Digital Marketing Agency
Hampshire Digital Marketing Agency
Merlin House 4 Meteor Way Lee-on-the-Solent, PO13 9FU, UK
Map of Lancashire Digital Marketing Agency
Lancashire Digital Marketing Agency
Cotton Court Business Centre Church Street, Preston Lancashire, PR1 3BY, UK
Map of London Digital Marketing Agency
London Digital Marketing Agency
Albert House 256 - 260 Old Street London, EC1V 9DD, UK

Unlike 08 numbers, 03 numbers cost the same to call as geographic landline numbers (starting 01 and 02), even from a mobile phone. They are also normally included in your inclusive call minutes. Please note we may record some calls.

Circle Cross