Yahoo was one of the first high-profile brands on the internet. It was founded at Stanford University by PhD students David Filo and Jerry Yang in February 1994.

The name is an acronym for "Yet Another Hierarchical Officious Oracle".

It was initially just a collection of links to sites of interest on the internet, but it quickly grew in popularity, attracting 100,000 users a day by autumn 1994.

Riding the crest of the internet boom, it went public in April 1996. The share price climbed swiftly and by late 1999, the two founders were worth $4 billion each. The bursting of the dotcom bubble in 2000 wiped out 86 per cent of Yahoo's market value, even though traffic to its websites was still growing strongly.

Yahoo's recent performance has proven that simply attracting high volumes of traffic to your website is not a viable business model - particularly in the face of competition from Google.

Yahoo is still the most popular US internet site, but its search engine has lost market share to Google. That has been one of the main factors in eight straight quarters of falling profits and a stock price that is half what it was two years ago.

Google has been able to mop up huge amounts of revenue for ads that appear as sponsored links beside its search results. It has also lost its share of the market for graphical or display ads to social networking sites like MySpace and Facebook.

With investors getting impatient, Mr Yang replaced Terry Semel as chief executive last June to try to kick start sales growth.

About half of Yahoo's value comes from its investments in China's Alibaba Group, a joint venture with Softbank and South Korea's Gmarket. It said these investments were worth more than $10 per share in the latest quarter. - (Additional reporting, Bloomberg)