Yahoo has reported declined profits of $297 million for the quarter ended September 30, 2013 (Q3 2013), down 10.3% from $331 million profit in the previous quarter and down 91% from $3.16 billion profit in the same quarter last year (Q3 2012). However, do note that the Q3 2012 profit includes a $2.8 billion gain from the sale of Alibaba group shares.
Revenue excluding traffic acquisition costs (revenue ex-TAC) marginally declined to $1.08 billion, down 1% from $1.09 billion revenues in the same quarter last year. The total revenue declined by 5% year-on-year (YoY) to $1.14 billion for the quarter, down from $1.2 billion in the same quarter last year.
– Yahoo has more than 800 million monthly active users, up 20% in the last 15 months.
– Released an updated My Yahoo start page and a new camera experience on Flickr iOS app with live customizable filters and editing capabilities, powered by GhostBird Software which Yahoo had acquired in June 2013.
– Launched Yahoo Weather app on Android and released an updated Yahoo app for iOS with animated cinemagraphs, ability to save content for later reading and others. A revamped Yahoo toolbar was also rolled out.
– Released a refreshed mobile web experience for several of its properties including Mail, Finance, Homepage, Search, Messenger, News and others.
– Launched redesigned versions of Yahoo Sports, Yahoo Movies, Yahoo Music, Yahoo TV, Yahoo omg!, Yahoo Games and Yahoo Weather.
– Extended Yahoo Stream Ads to Mail and its mobile media properties.
– Launched its Fall Comedy Lineup to offer eight original web series, archival clips from the “Saturday Night Live” show and clips from Viacom’s Comedy Central and MTV shows including The Daily Show with Jon Stewart, The Colbert Report and others. Also started offering more premium content through its partnerships with ABC News and NBC Sports.
Acquisitions: During the quarter, Yahoo acquired eight companies to strengthen its products, content offerings, core technology and talent. These include Bignoggins, Qwiki, Xobni, Admovate, Ztelic, Lexity, Rockmelt and IQ Engines. Yahoo used a combined net $163 million for these acquisitions.
Yahoo reported Asia Pacific revenues excluding traffic acquisition costs (Revenue ex-TAC) of $187 million for the quarter, down 10% from $207 million in the same quarter last year. The total revenue was at $199 million for the quarter, down 24.1% from $262 million in Q3 2012. APAC region accounted for 17.3% of Yahoo’s total revenues for the quarter, down from 19% in Q3 2012.
Display Revenues Down 7%
Display revenues continues to decline, posting a revenue of $469.9 million for the quarter, down 7.1% from $506 million in the same quarter last year. Excluding the traffic acquisition costs, the display revenue was at $421.3 million for the quarter, a 7% dip from $451.6 million in Q3 2012. Display revenues accounted for 41.2% of Yahoo’s consolidated revenues for the quarter.
The number of ads sold increased by 1% YoY during the quarter while the price per ad decreased by 7% YoY.
Search Revenues Down 8%
Search revenues also declined to $435.2 million for the quarter, down 7.9% from $472.5 million in Q3 2012. Excluding the traffic acquisition costs, the search revenues however saw a 3% YoY growth to $403 million for the quarter, up from $414.1 million revenues in Q3 2012. Search revenues accounted for 38.2% of Yahoo’s consolidated revenues for the quarter.
Paid clicks increased approximately by 21% YoY for the quarter while price per click decreased approximately by 4% YoY.
Alibaba share repurchase amendment: Yahoo has also amended its share repurchase and preference sale agreement with Alibaba Group, thereby lessening the number of the shares it was mandated to sell in Alibaba’s upcoming IPO.
As per the amendment, Yahoo is now required to sell only 208 million shares (39.7% of stake owned) as against the previous requirement of 261.5 million (about 50% of stake owned). Yahoo currently owns 523.6 million ordinary shares of Alibaba.
Share Repurchase: During the quarter, Yahoo repurchased 59 million shares for $1.69 billion for an average price of $28.53. As of September 30, 2013, Yahoo has $3.2 billion money in in form of cash, cash equivalents, and marketable securities.