Yahoo! Scores on Earnings: Search Trumps Display

January 28, 2013 by Jon C. Ogg

global network conceptYahoo! Inc. (NASDAQ: YHOO) is out with its fourth quarter earnings report. This is actually the first full quarter with Marissa Mayer on board as CEO.

Earnings for the fourth quarter came to $0.32 in earnings per share on $1.221 billion in revenue on an ex-TAC (traffic acquisition costs) basis. Thomson Reuters had estimates of $0.28 EPS and almost 4% sales growth to $1.21 billion in sales.

Display revenue ex-TAC was $520 million for the fourth quarter of 2012, down 5% compared to $546 million for the fourth quarter of 2011. The number of ads sold on core Yahoo! Properties decreased approximately 10 percent compared to the fourth quarter of 2011. Price-per-ad on core Yahoo! Properties increased approximately 7 percent compared to the fourth quarter of 2011.

Search revenue ex-TAC was $427 million for the fourth quarter of 2012, a 14 percent increase compared to $376 million for the fourth quarter of 2011. Paid clicks on sponsored listings on Yahoo! Properties and Affiliate sites rose by 11% compared to the fourth quarter of 2011. Price-per-click increased approximately 1 percent compared to the fourth quarter of 2011.

Cash and cash equivalents and short-term investments were $6 billion at December 31, 2012. Yahoo! also said that it repurchased 80 million shares for a total of about $1.5 billion in the quarter and that brought the 2012 year repurchase activity to 126 million shares for some $2.2 billion.

Shares were trading at $20.25 shortly before the close and the $20.50 intraday peak is just under a new multi-year high as the 52-week trading range is $14.35 to $20.52. Thomson Reuters had a consensus target price of $19.94 before the effects of Monday’s earnings report.

Yahoo! shares are trading up 4% at $21.10 in the after-hours report now that earnings have been released.

Sponsored: Attention Savvy Investors: Speak to 3 Financial Experts – FREE

Ever wanted an extra set of eyes on an investment you’re considering? Now you can speak with up to 3 financial experts in your area for FREE. By simply
clicking here
you can begin to match with financial professionals who can help guide you through the financial decisions you’re making. And the best part? The first conversation with them is free.


Click here
to match with up to 3 financial pros who would be excited to help you make financial decisions.