QUOTE AND NEWS
Jutia Group  6 hrs ago  Comment 
[Business Wire] - Yahoo! Inc. CEO Marissa Mayer will participate in a question-and-answer session at the Goldman Sachs Technology and Internet Conference in San Francisco. Read more on this. Yahoo! Inc. (YHOO), valued at $42.67B, opened this...
Yahoo  Feb 4  Comment 
Yahoo announced last week about a tax-free spinoff of its 15 percent stake in China's Alibaba into a newly formed independent registered investment company responding to pressure to hand over to shareholders its prized e-commerce investment valued...
Jutia Group  Feb 3  Comment 
[at TheStreet] - Yahoo! (YHOO) stock could climb higher this afternoon as the company increased its U.S. search share gains in January. Read more on this. Yahoo! Inc. (YHOO), currently valued at $42.92B, started trading this morning at $45.09. ...
TheStreet.com  Feb 3  Comment 
NEW YORK (TheStreet) -- Shares of Yahoo! are down 0.43% to $44.49 in afternoon trading Tuesday, despite data from independent website analytics provider StatCounter revealing upbeat market share figures for the month of January. Last month,...
Jutia Group  Feb 2  Comment 
[at Investor's Business Daily] - No. 3 Internet search service Yahoo (YHOO) grabbed more of the U.S. search market in January for the second consecutive month, while No. 1 Google saw its share dip below 75% for the first time, according ... Read...
TechCrunch  Feb 2  Comment 
 Days after Google reported a miss in its quarterly earnings on the back of declines in ad revenues, another development points to challenges being made on the search giant. Yahoo continues to inch up in search market share, at the expense of...
SeekingAlpha  Feb 2  Comment 
Motley Fool  Feb 1  Comment 
This governor, who has an intricate understanding of marijuana's challenges, exposed its greatest weakness in an interview with CNBC.




 

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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