Yahoo Shares Down In 2nd Quarter
Yahoo shares took a sharp fall on Tuesday as quarterly revenue growth of two percent fell short of expectations of analysts on Wall Street.
Yahoo said its 2nd quarter net profit rose 51 percent over a year earlier to 213 million dollars. Per share earnings were at 15 percent, better than the 14 percent analysts forecasted.
While quarterly net profits and earnings per share topped analyst expectations, revenue increased by a mere 2 percent in the quarter ending June 30 to 1.6 billion dollars.
Yahoo’s slow growth was a sharp contrast to Google’s quarterly revenue growth reached 24 percent.
Yahoo shares dropped 6.25 percent to 14.25 dollars in after-hours trading after the results were announced, after gaining 0.66 percent before the market closed.
Yahoo said it expected third-quarter revenue growth to push to between 1.57 and 1.65 billion dollars.
Yahoo Chief Executive Officer Carol Bartz said the company is pleased that they “continued to deliver strong operating income and margin expansion,” even if they “were at the low end of our revenue guidance.”
Bartz said Yahoo gained market share in the lucrative search and advertising market in the quarter, but still didn’t meet expectations.
Yahoo’s search advertising revenue declined by eight percent in the quarter while display advertising revenue increased by 19 percent. “Display growth was very strong and search is stabilizing,” Bartz acknowledged.
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