QUOTE AND NEWS
TechCrunch  4 hrs ago  Comment 
 Built.io’s Flow is a drag-and-drop tool for building enterprise integrations. It’s a bit of a mix of Yahoo Pipes (R.I.P.) and IFTTT for connecting services like Salesforce and Marketo to help automate the sales process in an organization,...
Clusterstock  4 hrs ago  Comment 
After months of reports that Yahoo's in talks for a potential sale of its core internet business, SunTrust's analyst Bob Peck says there's a chance a deal won't happen at all. In a note published Monday, Peck wrote it's still possible that Yahoo...
Benzinga  6 hrs ago  Comment 
Pivotal Research has downgraded Yahoo! Inc. (NASDAQ: YHOO) to Hold from Buy on valuation, while maintaining Buy ratings on Google-parent Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) and Facebook Inc (NASDAQ: FB). "[W]e are downgrading Yahoo from...
SeekingAlpha  9 hrs ago  Comment 
Benzinga  7 hrs ago  Comment 
  Credit Suisse lowered the price target for Toll Brothers Inc (NYSE: TOL) from $34 to $30. Toll Brothers shares fell 0.07 percent to trade at $28.22. JPMorgan slashed PBF Energy Inc (NYSE: PBF) price target from $33 to $21. PBF...
Benzinga  10 hrs ago  Comment 
Bob Peck of SunTrust Robinson Humphrey expects Yahoo! Inc. (NASDAQ: YHOO) to make a decision on the core sale around July 18. He downgraded the rating on the company from Buy to Neutral, while lowering the price target from $44 to $42. 4...
Benzinga  9 hrs ago  Comment 
Motley Fool  Jul 9  Comment 
The unfunded obligations of this critical safety net put Social Security's future on shaky ground.
Motley Fool  Jul 9  Comment 
A new study from the Yale School of Public Health reveals a shocking reason why some consumers are avoiding Obamacare.
Yahoo  Jul 8  Comment 
With Donald Trump fully immersed in the election, his son, Eric Trump, sat down with Yahoo Finance at Trump Tower this week to talk about the state of the family business.
TechCrunch  Jul 7  Comment 
 What’s a poor beleaguered brand like Yahoo to do? Use its smart engineers to jump on the hottest trend, of course. Today the company is launching a bot that simulates a pet monkey for Facebook Messenger. Oh, and a few slightly more useful...
Clusterstock  Jul 7  Comment 
In late 2014, Yahoo struck a deal with Mozilla to make it the default search engine on all Firefox browsers in the US. That deal, which cost Yahoo $375 million in 2015, was meant to help Yahoo expand its search market share and better compete...




 

Yahoo! Inc. (Nasdaq: YHOO) is a global internet services company that operates the Yahoo! Internet portal. It provides varied products and content, from email and search to media streaming and downloads. Its main revenue sources come from advertising and marketing services. In fiscal year 2010, Yahoo reported revenues of $6.3 billion and net income of $1.2 billion. While Yahoo's main presence is in the United States, its well-established name and solid partnerships in Asia make international expansion a promising opportunity for the company. In response to the fast growing mobile advertising market, Yahoo has been actively pursuing partnerships with carriers and original equipment manufacturers in the mobile industry, as well as tailoring their existing marketing services to mobile users.

Company Overview

Founded as a web directory by two Stanford graduates in 1994, Yahoo! had become a dominant player in the field of Internet services although its competitive position has since become eclipsed by Google and others. The company had experienced healthy growth in top-line revenue year over year for the last four years, but net income has fallen year-over-year due to increased costs of doing business in the increasingly competitive sphere of internet advertising. Specifically, Yahoo!'s year over year cost of revenue is increasing faster than their revenue growth.

Trends and Forces

Increase in Online Advertising

Advertising spending continues to show a disproportionate skew in favor of newspaper, TV and direct mail. However, the Internet channel has grown at approximately 18% per year--faster than any other channel--taking share from stagnant channels such as newspaper, which has been flat over the same time period. Continued growth in quality and availability of Internet access means that the Internet services sector--particularly Internet advertising--will remain lucrative for some time to come. An increasingly pronounced trend of replacing print directories and classifieds with virtual alternatives will also create a push for online search use as well as increase demand for online classifieds.

Online Video Advertising Growth

Video advertising promises to be a particularly lucrative area of rapid growth in the online advertising sector as online video viewership continues to rise. In research released by comScore, data shows that 175 million U.S. Internet users watched online video content in October for an average of 15.1 hours per viewer.[1]. In terms of video property and viewership, Yahoo ranked second with 53.8 million viewers, behind Google Sites's 146.3 million unique viewers and ahead of Viacom Digital, VEVO, and Facebook[1].

  • Branded vs. Search Advertising

Branded advertising is often image-based and usually priced on an "impressions" basis--the more times it shows up, the more the advertiser pays. Search advertisements are primarily text-based and usually rely on click-through; the more times a particular link is clicked, the more Yahoo! is paid. Together, the two constitute a good balance of different kinds of online advertising. However, branded advertising tends to depend very heavily on the economic situation of the brands in question.

  • Mobile Advertising

Mobile advertising is in its nascent stages and is currently growing at more than 20% per year, making it a powerful source of potential growth for Yahoo! On its end, the company has been actively pursuing partnerships with carriers and original equipment manufacturers in the mobile industry, as well as tailoring their existing marketing services to mobile users.[2]

Competition

  • Google is Yahoo!'s biggest competitor in search advertising. Google's acquisition of popular video site YouTube put it directly against Yahoo! in media streaming, and the two already have a long-standing rivalry over search-based online advertising. Yahoo! has lost significant search market share to Google. In 2009, Google made headlines by overtaking Yahoo! in unique users per month. However, Yahoo! recently released a next-generation online advertising platform system called Panama. Their system will in theory optimize advertising profits by increasing the average revenue per search click and has returned modestly successful results so far. Yahoo!'s recent acquisitions of RightMedia and BlueLithium further solidifies its position in display advertising. Finally, Yahoo!'s perceived role as a community-based entertainment site may also give it a slight edge over Google in entertainment-based advertising. However, Google's MySpace-YouTube advertising alliance may be poised to challenge the company.
  • Microsoft, with the introduction of Windows Live and adCenter, Microsoft is also a growing threat. Microsoft's acquisition of LiveJournal gives it a significant foothold in the webblog scene, and along with Google, it has been steadily gaining ground against Yahoo! in the European Internet services market. However, by itself Microsoft remains less a threat than Google.
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