In an indication that CEO Marissa Mayer is not yet seeing dramatic results from her efforts to turn the company around, Yahoo’s sales dipped slightly in its first quarter, amid some gains in its search advertising business.
Revenue for the quarter ended 31 March was $1.13 billion, Yahoo reported Tuesday, down 1% from the same period last year. Excluding traffic acquisition costs, revenue for the quarter rose by 1%, to roughly $1.09 billion, just beating expectations of analysts polled by Thomson Reuters.
Mayer said she was pleased by the company’s revenue. The quarter, she maintained in the company’s announcement, “was an early and important sign of growth in our core business.”
The company’s quarterly net earnings, however, dropped by 20% to $312 million. Net earnings per share for the quarter were $0.29, down 17%.
On a non-GAAP basis, which excludes certain expenses, Yahoo’s net earnings per share were $0.38, slightly beating analysts’ expectations of $0.37.
Since taking the helm as CEO in 2012, Mayer has sought to turn Yahoo around through a string of acquisitions, redesigned products and new content verticals. Major gains in advertising have proven elusive, but Tuesday’s earnings point to some new life in those areas.
Yahoo’s search revenue for the quarter rose by 5% to $445 million. Last quarter, Yahoo reported a 4% drop in search ad revenue. Search is an area in which Yahoo wants to break new ground, Mayer has said, though the company is hampered to a degree by its deal to use Microsoft’s Bing search engine.
Yahoo’s display revenue, however, was flat at $453 million for the quarter. And while the number of display ads sold increased by 7%, Yahoo said, the price per ad decreased by 5%.
In mobile, meanwhile, Yahoo reported a modest gain in users, to 430 million monthly users, up from 400 million reported earlier this year. Yahoo has struggled, however, to significantly monetise its services on mobile. In January the company said its revenue from mobile products was still not material to its business.
Yahoo’s stock was trading at $34.21 in after-hours trading on Tuesday, up slightly from its close of $33.45 on Monday.
Zach Miners, IDG News Service
@zachminers zach_miners@idg.com
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