Mayer outlines new Yahoo strategy
Yahoo! shares rose in extended trading after new chief executive officer Marissa Mayer outlined her turnaround strategy for the biggest US web portal, emphasizing mobile technology and personalized services.
Ms Mayer aims to grow as fast as competitors in online search, display advertising, mobile applications, and products such as e-mail, she said yesterday, on her first call with analysts since being named chief executive in July.
Yahoo earlier reported third-quarter profit and sales that topped analysts' estimates. The company's fifth chief executive in four years plans to reverse three straight annual sales declines by recharging growth in existing businesses.
Ms Mayer plans to focus on small acquisitions of less than $100 million rather than large deals, and expects to move workers around within Yahoo instead of cutting large groups of employees, she said.
"Marissa Mayer has taken baby steps to improve operations at Yahoo," said Kevin Stadtler, president of Stadtler Capital Management in Fort Worth, Texas, who manages $6.5 million in assets, including Yahoo.
"Large acquisitions are not necessary to resume top-line growth."
Third-quarter profit, excluding some items, was 35 cents a share, the California-based company said in a statement yesterday.
Sales, excluding revenue passed to partner sites, increased 2 per cent to $1.09 billion.
Yahoo shares rose as much as 4.8 per cent in late trading after the report yesterday.
They had declined less than 1 per cent to $15.77 at the close in New York. The stock has dropped 2.2 per cent this year.
Profit got a boost as expenses fell after the company eliminated jobs, and sales of advertisements alongside search results increased at a faster pace than display-type ads.
"We've been through a couple rounds of cost-cutting, so this is a product of that," said Brett Harriss, an analyst at Gabelli and Co who recommends buying Yahoo shares.