We're hiring

We love digital - Call
03332 207 677
and say hello - Mon - Fri, 9am - 5pm

Call 03332 207 677

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

Stephen Logan
About the author

Stephen Logan

Stephen Logan was a Senior Content Marketer at Koozai. With four years experience writing exclusively for the search engine marketing industry, he has amassed a wealth of industry related knowledge. He will be breaking news stories and contributing compelling SEO related stories.


What do you think?

  • aspect-ratio Koozai at Search Elite
    Cat Birch

    Koozai Sponsors Search Elite 2017. Plus, win a free ticket!

    We are pleased to announce that Koozai will be sponsoring Search Elite London! (more…)

    Cat Birch
    20th Mar 2017
  • aspect-ratio Sam judging awards
    Cat Birch

    Samantha Noble Judging MENA Digital Awards, DANI Awards And UK Biddable Media Awards

    Samantha Noble is well known within in the search industry, she even won the UK Search Personality 2016 at the UK Search Awards in November. This year, she continues to make an impact on the industry by judging not only one, but three, prestigious industry awards.

    Cat Birch
    8th Mar 2017

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?