Yahoo!

Posted on September 30, 2015 by Rebecca Baruch

Rebecca Baruch

: Source: Bizjournals, Yahoo! Logo [20]

“We make the
world’s daily habits inspiring
and entertaining”

– Yahoo! Inc. [26]

Source: Yahoo!, CEO, Marissa Mayer [21]

YAHOO! INC.~ WHO WE ARE

Yahoo! Inc. is a technology company that provides a variety of services for its online users. It was founded by Stanford University graduates and classmates, Jerry Yang and David Filo in 1994. It became incorporated later in 1995. A year later, in April 1996, it became a publicly traded company [1]. Since then Filo has stayed on as one of the company’s key executives, returning to its Board of Directors in 2014 [2].

Its current CEO, Marissa Mayer, who stepped into the position in 2012, worked previously at Google as one of its executives and helped develop many of its popular services like Google Maps and Gmail. She is the sixth person to take over the position of Yahoo! Inc.’s CEO since 2007 [3].

A majority of Yahoo! Inc.’s profits are gained not through subscriptions or payments from its users but rather through selling advertisement space on its various websites [4].

Source: Youtube, Yahoo! Commercial [29]

Yahoo! Inc.’s international presence reaches users in over fifty countries worldwide. Some of their main services include Yahoo! Search, an Internet search engine to help navigate users through online data and websites. It also has original and partnered content on services like Yahoo! News, Yahoo! Finance and Yahoo! TV [5].

Source: Flickr, Flickr Logo [22] Source: Tumblr, Tumblr Logo [23]

It also acquires smaller online enterprises in order to boost their research and reach on the ever-growing web. Back in June 2013 the company bought the popular blog website, Tumblr for $1.1 billion [6]. Yahoo! Inc. also has had, Flickr, the popular photo-managing site since 2005 [7]. These types of acquisitions were not only meant to increase profits, but to also understand the mindset and lifestyle of their users [6].

YAHOO! INC.~ Financials

This past third-quarter revealed that Yahoo! Inc.’s revenue was $1.23 billion. Last year’s quarter the company accumulated $1.15 billion in revenue [8]. Despite the increase in revenue, the company did not reach expected targets as they were predicted to make $1.26 billion in revenue this quarter. As well, rather than reaching $0.17 per share, the company ended up being valued at less than $0.10 per share. Yahoo! Inc.’s underperformance this quarter is disappointing to its potential investors and current stakeholders [9].

Source: Alibaba, Alibaba Logo [24]

Yahoo! Inc. holds a 15% stake in Alibaba Group Holding Ltd., which is an e-commerce company that provides services such as an online shopping search engine and electronic payments for businesses and customers. Alilbaba Group Holding Ltd.’s stock value has dropped 38.7% this past year. Yahoo! Inc. came up with a recovery plan to sell shares from their investment, but that will unlikely be implemented. Recently, the IRS rejected a deal Yahoo! Inc. was planning on making that would spin-off 384 million shares [10].

Source: Google, Google Logo [25]

Yahoo! Inc. struck up a deal with Google this past October that will last until 2018. Google will be providing Yahoo! Inc. with search advertisements. Google will then give Yahoo! Inc. a percentage of the revenue earned. Google will also disclose web search results and other data from users to Yahoo! Inc. to benefit its market research [11]. This information can be accessed from a variety of devices including, but not limited to, tablets, laptops and desktop computers. This non-exclusive deal still allows Yahoo! Inc. to work with other companies such as Microsoft, who they have worked with in the past. This deal will hopefully boost the company’s profits and help it have a greater understanding of its users [12].

YAHOO! INC.~ Leadership

Source: Business Insider, Marissa Mayer [27]

Much of Yahoo! Inc.’s financial difficulties have been attributed to the leadership style of the company. Its latest CEO, Marissa Mayer, has been suffering from a lot of criticism. This new CEO came aboard, knowing that she would have to fix a company that was dealing with a problematic system. She is seen as an inspirational figure for women in a predominately male dominated industry [13]. Over the years Mayer has come under fire for controversial policies and personal decisions. Overall, she uses her knowledge of the business, is the youngest CEO in history to run a Fortune 500 company and has a youthful perspective she uses to try and turn around Yahoo! Inc. in all of its failing sectors [14].

Source: CNN, Marissa Mayer [14]

Mayer’s decisions have not benefited Yahoo! Inc. in the way that she intentioned them to. With Tumblr, Flicker and other acquisitions not making the promising profits that they were thought to have and the Alibaba deal being halted by the IRS, bringing Yahoo! Inc. out from its financial distress, does not seem to be a reality [15].

Although the deal with Google has potential to bring both greater profits and user data to Yahoo! Inc. the benefits of that deal will not be seen for many years to come. Investors are asking for Mayer to either resign or to be ousted from the company altogether. In her near four years as CEO, Mayer has spent around $7 billion in acquisitions and has been unable to turn a profit from those investments. For this reason and others many question her leadership skills and whether she can bring the company together. Mayer may soon be fired by Yahoo! Inc.’s Board of Directors [15].

Mayer herself disagrees with the investors’ and the public’s view of a failing company. Mayer believes that the new initiatives she has put in place will soon pay off and bring the company back to its original days of success. Mayer is only one of half a dozen CEOs who have come and gone in the past decade at Yahoo! Inc. [15]. The company has also had executives leave as well, like the loss of their Marketing Chief to STX Entertainment, so it would be no surprise to see Mayer take her exit [16]. This type of shake up in the hierarchal system may be one of the reasons that Yahoo! Inc. is having issues with its services and ability to make a profit, because of its lack of strong and consistent leadership.

YAHOO! INC.~ The future

Source: Vserv, Yahoo! Logo [28]

Overall, Yahoo! Inc. has gone from a search engine focused company to one focusing on its media presence. This has been done unsuccessfully and for this reason its board will be meeting several times the first week of December of 2015 in order to make some executive decisions about leadership and what the future of Yahoo! Inc. looks like as a company [17].

Yahoo! Inc.’s constant replacement of CEOs has rocked the company’s structure and efficiency. It needs a new strategic business plan in order to stay competitive in its markets. Since the Alibaba deal went south, there is going to be a last effort to boost stock value of Yahoo! Inc. by potentially selling the company’s core assets. Considering that Yahoo! Inc. shares have gone down 35%, this seems like a strategically intelligent move [18].

After rumors of this potential sale circulated through investors and outside parties, Yahoo! Inc.’s stock value boosted by 5.6%, showing that the public views this sale as a potential solution to the company’s problems [19].

The future of Yahoo! Inc. is unclear, both in leadership and in its financial state. Despite this, it is not a lost cause, it has the potential for growth and greater success.

Sources

[1] Yahoo! Inc. Success Story. Success Story. Retrieved: November 28th 2015.

[2] Musil, Steven. (April 16th 2014). Yahoo co-founder David Filo nominated to return to board. CNET. Retrieved: November 29th 2015.

[3] Efrati, Amir & Letzing John. (July 17th 2012). Google’s Mayer Takes Over as Yahoo Chief. The Wall Street Journal. Retrieved: November 28th 2015.

[4] Peterson, Tim. (October 21st 2014). Yahoo Now Makes More Money From Search Ads Than Banners. Adage. Retrieved: December 1st 2015.

[5] Products and Services. Yahoo!. Retrieved: November 12th 2015.

[6] Isidore, Chris. (May 20th 2013). Yahoo buys Tumblr, promises to not ‘screw it up’. CNN Money. Retrieved: November 29th 2015.

[7] Geron, Tomio. (August 2013). A Look Back At Yahoo’s Flickr Acquisition For Lessons Today. Tech Crunch. Retrieved: November 29th 2015.

[8] (October 20th 2015). Investor Relations. Yahoo!. Retrieved: October 22nd 2015.

[9] Pramuk, Jacob. (October 20th 2015). Yahoo cuts Q4 guidance after earnings miss. CNBC. Retrieved: October 22nd 2015.

[10] Cornell, Joe. (October 1st 2015). Yahoo’s Alibaba Spin-Off On Track. Forbes. Retrieved: November 29th 2015.

[11] Riley, Duncan. (October 21st 2015). Back to the future: Yahoo returns to Google’s loving embrace with new search and ad deal. Silicon Angle. Retrieved: December 1st 2015.

[12] Rosoff, Matt. (October 20th 2015). Yahoo has signed a deal with Google to provide search ads. Business Insider. Retrieved: November 29th 2015.

[13] Gustin, Sam. (July 18th 2012). The Ten Most Influential Women in Technology. Time. Retrieved: December 1st 2015.

[14] La Monica, Paul R. (October 21st 2015). Marissa Mayer STILL hasn’t fixed Yahoo. CNN Money. Retrieved: December 1st 2015.

[15] (November 27th 2015). For Yahoo CEO Marissa Mayer, the clock is ticking. CBS Money Watch. Retrieved: November 28th 2015.

[16] Jones, Dow. (September 11 2015). Yahoo Marketing Chief to Join STX Entertainment. Nasdaq. Retrieved: November 29th 2015.

[17] Poletti, Therese. (December 1st 2015). Selling Yahoo’s core business would be complicated. Market Watch. Retrieved: December 1st 2015.

[18] Goldman, David. (December 1st 2015). Yahoo could be looking for a buyer. CNN Money. Retrieved: December 1st 2015.

[19] (December 1st 2015). Yahoo shares spike on report company may sell core assets. CNBC. Retrieved: December 1st 2015.

[20] Yahoo! Logo. Biz Journal. Retrieved: December 1st 2015.

[21] Yahoo! Executive Team. Yahoo!. Retrieved: December 1st 2015.

[22] Flickr Logo. Flickr. Retrieved: December 1st 2015.

[23] Tumblr Logo. Tumblr. Retrieved: December 1st 2015.

[24] Alibaba Logo. Alibaba. Retrieved: December 1st 2015.

[25] Google Logo. Google. Retrieved: December 1st 2015.

[26] Yahoo! Quote. Yahoo!. Retrieved: November 29th 2015.

[27] Marissa Mayer Photo. Business Insider. Retrieved: December 1st 2015.

[28] Yahoo! Logo. Vserv. Retrieved: December 1st 2015.

[29] Yahoo! Commercial. Youtube. Retrieved: December 1st 2015.

Yahoo

Posted on March 15, 2014 by Samantha Ho

By Sam Ho

Yahoo Logo [1]

701 1st Ave, Sunnyvale, CA 94089

Phone: (408) 349-3300

Company Profile

As the world’s largest start up company, Yahoo is a global technology corporation that started as a simple search engine and has grown into a web portal at the global forefront of highly personalized, “daily habit” products and services. Whether through the Yahoo home page or their own personalized page, affectionately named My Yahoo, 800 million monthly users in 60 countries around the world have access to weather, mail, sports, finance, games, and many more powered through Yahoo services.[2]

Key Executives [3]

Marissa Mayer, CEO, President, and Director

David Filo, Co-Founder and Chief Yahoo

Ken Goldman, Chief Financial Officer

Kathy Savitt, Chief Marketing Officer

History

Founded in 1994 by two Stanford PhD candidates, David Filo and Jerry Yang, Yahoo initially began as a website, titled Jerry and Dave’s Guide to the World Wide Web, that listed David and Jerry’s favorite internet sites. After gaining heavy popularity, the two discovered that their little guide could become a successful business and renamed it. The web directory continued to change in the 1990s and diversified into a web portal to provide eager users with the services of Yahoo! Mail, Yahoo! Games, and Yahoo! Groups.[4] Adding weather, sports, and finance to the mix, the web portal became the center of daily habits. In 2005, it acquired the popular photo sharing service Flickr and its 1 million loyal and consistent users.[5] In 2013, it continued to expand its reach towards more active online users by buying the famous blogging site, Tumblr, for $1.1 billion.[6] Specializing in search, content, and communication tools, Yahoo is standing its ground at the forefront of technology.

1996 Yahoo Homepage [7]

2013 Yahoo Homepage [8]

Financial Snapshot

Publicly traded since 1995, Yahoo‘s stock (YHOO) is currently up 0.08% since its previous

Yahoo Financial Chart [10]

close at $36.38. [9] On April 15th, 2014, the Yahoo! Inc. reported its first quarter 2014 results in accordance with a live stream online. While the company’s stock has performed exceedingly well at the markets over the past two years, its revenues have failed to gain traction. The GAAP revenue for the quarter was $1.13 million, down 1% from the Q1 2013. The company’s quarterly GAAP net earnings also dropped by 20 percent to $312 million. Net earnings per share for the quarter were $0.29, down 17 percent.

Despite its poor marks compared to its Q1 2013 results, Yahoo made smaller successes in its display and search ad revenues, which make up 12.4% and 14.2% of its value respectively. Compared to the first quarter of 2013, its Q1 2014 GAAP display revenue of $453 million remained consistent because of the 7% increase in Number of Ads Sold. With Paid Clicks increased approximately by 6% and the Price-per-Click increased by about 8%, the 2014 GAAP search revenue of $445 million experienced a successful 5 percent increase compared to the first quarter of 2013. [11]

Making Changes

CEO Marissa Mayer at the 2014 Consumer Electronics Show [12]

The Comeback Kid: With 13 years of employment at Google, including the title of first female engineer at the company, it was only right for Marissa Mayer to set her sights on Yahoo. Named Yahoo CEO, President, and Director in July 2012, Mayer has been determined to lead Yahoo out of its 3rd place spot and into a place at the forefront of technology.[3] With about two years as evidence, she is well on her way after rolling out a new homepage, redesigning Yahoo Mail and saving Flickr from near death. As she continues to orchestrate more acquisitions for the company, such as her biggest move yet to buy Tumblr, Marissa Mayer is breaking Yahoo records and making strong steps towards modernizing the pioneer portal.[13]

Yahoo Advertising: Starting in 2014, Yahoo wants to place itself at the center of the online ad ecosystem with its latest creations: Yahoo Advertising and Yahoo Ad Manager. Launching under a new unifying brand, the idea of Yahoo Advertising aims to simplify a fragmented market. Buyers will be able to automatically buy across Yahoo’s various channels, including the Web, video, mobile, and Tumblr, all in a central interface called Yahoo Ad Manager. [12] Tapping into the

Yahoo Gemini – Mobile and Native Ads [14]

ever-growing 430 million mobile Yahoo users, Yahoo Gemini, a function within Yahoo Ad Manager, will be the first of its kind to combine mobile search and native advertising in one accessible solution.[14] The successful future of this new system is evident in the digital ads within Yahoo’s newly launched digital magazines, Yahoo Food and Yahoo Tech. Instead of a simple box in the corner, the native ads of each site are integrated and authentic, allowing consumers to treat each promoted brand as informative content. Yahoo’s belief that “storytelling aids brand retention” embodies the new shift towards fully integrated marketing and a push towards more successful ad sales. [15]

Yahoo Screen on Roku [18]

Yahoo Screen: Rivaling competitors such as Hulu, Netflix, and YouTube, Yahoo‘s video streaming service, Yahoo Screen, combines over 70 original web shows and a diverse array of content from partners such as Saturday Night Live, The Onion, GQ, ABC News, and Vogue.[16] In mid April 2014, Yahoo and Vevo announced that they will be expanding their partnership through a deal that will bring Vevo’s videos, live concert events, and other original programming to the Yahoo site. [17] In addition to new content, Yahoo Screen has been expanding the source through which its content is viewed. In 2013, the video streaming service launched its own mobile app for Apple iOS devices and soon followed that decision with its launch on the Apple TV. During its first quarter in 2014, Yahoo Screen launched its own channel on another home TV box, called Roku. Providing a new variety of content to eager users and new ways to receive their desired entertainment, Yahoo is slowly pushing its way into online video with much more focus and quality. [16]

The Future of Yahoo

Yahoo Smart TV [22]

As Yahoo works to repair and reorganize within its own systems, Marissa Mayer and the company are looking to journey outside of Yahoo‘s own boundaries, finding a place within Television. Yahoo is in talks to acquire News Distribution Network Inc., which could make Local TV news a big part of the online landscape.[19] In addition, Yahoo is rumored to have interest in producing its own TV content in competition with Netflix original programming.[20] Combined with its latest creation, Yahoo Smart TV, Yahoo hopes to bring its sphere of influence to the Televised world.

Yahoo Buys Aviate [23]

In many ways for the company’s CEO, mobile is the future. Delivering her first keynote at the Consumer Electronics Show in January 2014, Mayer started with an exciting announcement that Yahoo had acquired Aviate. With the technology to customize the Android’s smartphone home screen based on personal information, the company is looking towards its future in the mobile industry. While Apple owns the iOS mobile operating system and Google owns Android, Aviate could be Yahoo’s golden ticket. [21]

Sources

[1] Yahoo Logo RT: 19 April 2014

[2] Yahoo Corporate Information RT: 16 April 2014

[3] Yahoo Executive Team RT: 16 April 2014

[4] Silicon Valley Historical Association: Yahoo! Inc. From 2008. RT: 17 April 2014

[5] “Flickr At 10: 1M Photos Shared Per Day, 170% Increase Since Making 1TB Free”. From 10 Feb 2014. RT: 18 April 2014

[6] “Yahoo buys Tumblr, promises to not ‘screw it up'”. From 20 May 2013. RT: 17 April 2014

[7] 1996 Yahoo Homepage Image. RT: 19 April 2014

[8] “Yahoo’s new homepage is a good first step” From 20 Feb 2013. RT: 17 April 2014

[9] YHOO Profile. RT: 19 April 2014

[10] “Yahoo sales sag with mixed results in ads” From 15 April 2014. RT: 18 April 2014

[11] Yahoo Reports First Quarter 2014 Results. RT: 19 April 2014