Yahoo Inc said on Tuesday it had signed a search advertising deal with Google Inc, providing a potential boost to Marissa Mayer's efforts to turn around the company, which also reported revenue and profit that fell short of market estimates.
The deal with Google, a unit of Alphabet Inc, builds on an existing search partnership Microsoft Corp under which Yahoo gets a percentage of revenue from ads displayed on its sites.
Yahoo, whose shares were down 1.6 percent in after-hours trading, said the companies have agreed to delay implementation of the deal in the United States to allow the antitrust division of the Department of Justice to review it.
Yahoo has been struggling to boost revenue from ad sales in the face of stiff competition from Google and Facebook.
The Google deal was one of the few bright spots included in the company's third-quarter results statement.
Yahoo said it expected fourth-quarter revenue of $1.16 billion–$1.20 billion, well below the average analyst estimate of $1.33 billion, according to Thomson Reuters I/B/E/S.
Mayer, in her fourth year as chief executive, said the forecast was "not indicative of the performance we want."
"We are also experiencing continued revenue headwinds in our core (advertising) business, especially in the legacy portions," Mayer said on a call with analysts.
MAVENS PERFORM
Yahoo said the proposed spinoff of its 15 percent stake in Chinese e-commerce giant Alibaba Group Holding Ltd - a key issue for shareholders - may now close in January.
Yahoo earlier this year sought a private letter ruling from the Internal Revenue Service to confirm whether the transaction, worth about $27 billion currently, would result in a tax obligation. The tax agency denied the request, but Yahoo said it would go ahead with the spinoff by year-end anyway.
Many analysts attribute little value to Yahoo's core business without its Asian assets, which also include a 35 percent stake in Yahoo Japan Corp.
Apart from the Google deal, the only other good news came results came from Yahoo's emerging businesses, which Mayer calls Mavens - mobile, video, native and social advertising.
Revenue in that area rose 43 percent to $422 million in the quarter. Native advertising refers to ads that blend into the type and style of the content being viewed.
Excluding items, the company earned 15 cents per share, missing the average analyst estimate of 17 cents.
Revenue after deducting fees paid to partner websites fell to $1.0 billion from $1.09 billion, and the company forecast a drop to $920 million-$960 million in the current quarter.
Traffic acquisition costs, the amount Yahoo spends to attract users to its websites, jumped to $223 million in the quarter from $54 million a year earlier.
GAAP revenue rose 6.8 percent to $1.23 billion, falling short of the average analyst estimate of $1.26 billion, according to Thomson Reuters I/B/E/S.
Through Tuesday's close of $32.83, Yahoo's shares had lost 35 percent this year.
Reuters
Wed Oct 21 2015
An illustration picture shows the logos of Google and Yahoo connected with LAN cables in a Berlin office October 31, 2013. REUTERS/Pawel Kopczynski
Penunjuk perasaan Palestin tempelak wartawan AS
Mereka menuduh wartawan A.S sembunyikan dan berikan gambaran salah mengenai perang di Gaza.
Lawatan ke Riyadh: Blinken melawat Arab Saudi esok
Setiausaha Negara Amerika Syarikat, Antony Blinken akan melawat Arab Saudi pada Isnin untuk bertemu dengan rakan serantau dan membincangkan usaha mencapai gencatan senjata di Gaza dan pembebasan tebusan Israel.
Iraq lulus akta penjara maksimum 15 tahun
Parlimen Iraq meluluskan undang-undang yang menjenayahkan hubungan sejenis dengan hukuman penjara maksimum 15 tahun pada Sabtu.
PRK Kuala Kubu Baharu: MB nafi rumah terbuka Selangor langgar akta
Penganjuran Rumah Terbuka Aidilfitri Peringkat Negeri Selangor yang diadakan pada Sabtu malam di pekan Kuala Kubu Bharu (KKB) di sini, tidak melanggar Akta Kesalahan Pilihan Raya 1954 (AKPR).
Pengurus rumah kebajikan didenda RM4,500 cederakan warga emas
Seorang pengurus rumah kebajikan didenda RM4,500 selepas mengaku bersalah mendatangkan kecederaan kepada seorang warga emas.
Amiruddin nafi rumah terbuka langgar peraturan pilihan raya
Menteri Besar Selangor Datuk Seri Amirudin Shari menafikan dakwaan bahawa penganjuran Rumah Terbuka Aidilfitri oleh kerajaan negeri di pekan Kuala Kubu Baharu (KKB) pada Sabtu, melanggar peruntukan Akta Kesalahan Pilihan Raya 1954.
Misi teroka peluang ekonomi, tarik pelaburan baharu di WEF - Anwar
Malaysia dalam misi meneroka pelbagai peluang ekonomi dan menarik pelaburan baharu pada Mesyuarat Khas Forum Ekonomi Dunia (WEF) di Riyadh, Arab Saudi yang akan berlangsung dua hari bermula hari ini.
Polis Jerman rampas 4 Bugatti Veyron
Jerman merampas empat kereta model Bugatti Veyron yang jarang ditemui dari kemudahan simpanan persendirian di Munich, Jerman, yang dikaitkan dengan skandal 1Malaysia Development Berhad (1MDB), menurut laporan media Jerman.
AWANI Ringkas: Dijangka diniagakan sekitar RM4.77 berbanding dolar AS
Ikuti rangkuman berita utama yang menjadi tumpuan sepanjang hari di Astro AWANI menerusi AWANI Ringkas.
Mutawif pimpin jemaah 'istimewa' tunai umrah guna tongkat
Menjadi impian umat Islam di seluruh dunia termasuk golongan kurang upaya untuk menjejakkan kaki ke tanah suci Makkah bagi menunaikan ibadah haji dan umrah.
Undang-undang tuntutan bayaran berita dalam talian perlu kajian menyeluruh - Pakar
Menurut penganalisis, tiba masanya kerajaan menimbangkan cadangan melaksanakan akta berkenaan bagi memastikan industri media kekal mampan.
Sundar Pichai kini turut memegang jawatan CEO Alphabet
Pengasas Google, Larry Page dan Sergey Brin mengumumkan perletakan jawatan di induk tersebut dan menyerahkan tugas tersebut kepada Pichai
GM umum kereta pandu sendiri tanpa stereng, pedal pada 2019
GM berkata model kereta itu adalah generasi ke-empat dari rangkaian kereta eletrik, pandu sendiri Chevy Bolts yang kini sedang diuji atas jalan raya San Fransisco dan Phoenix.