QUOTE AND NEWS
Benzinga  1 hr ago  Comment 
Dallas Maverick owner and technology entrepreneur Mark Cuban tweeted on Friday that he is buying shares of Netflix, Inc. (NASDAQ: NFLX). Cuban noted that shares of Netflix's market cap of approximately $21 billion is nearly half the size of...
Forbes  3 hrs ago  Comment 
Despite an expected dip in profit, analysts are generally optimistic about Yahoo! as it prepares to reports its third-quarter earnings on Tuesday, October 21, 2014. The consensus earnings per share estimate is 20 cents per share.Over the past...
Jutia Group  Oct 16  Comment 
[at Bloomberg] - Oct. 16 (Bloomberg) -- Ned Brody, head of the Americas for Yahoo! Inc., and George John, chief executive officer of Rocket Fuel, participate in a panel discussion about the outlook for the advertising ... Read more on this. ...
The Times of India  Oct 16  Comment 
In a radical restructuring, Yahoo India is pulling back work to its Sunnyvale, California, headquarters, and laying off large numbers of its employees in Bangalore.
Forbes  Oct 15  Comment 
Here's why it would be a great deal for Alibaba to buy Yahoo now.
Jutia Group  Oct 15  Comment 
[Market Realist] - Yahoo has already committed to returning half of the cash proceeds that it received by selling its stake in Alibaba to shareholders through a buyback or dividends. Read more on this. Yahoo! Inc. (YHOO), valued at $37.62B,...
newratings.com  Oct 15  Comment 
SUNNYVALE (dpa-AFX) - Yahoo Inc (YHOO) is shutting down its office in Amman, Jordan, office as part of efforts to reduce costs in its international operations. The move will result in the elimination of about 80 jobs; the company plans to...
Wall Street Journal  Oct 14  Comment 
The Internet portal is closing its Amman, Jordan, office as part of a broader effort to cut costs overseas.
TheStreet.com  Oct 14  Comment 
NEW YORK (TheStreet) -- Yahoo! reports third-quarter earningsanext Tuesday, its first report since the recent Alibabaa ainitial public offering and the letter to the board from activist Starboard Value LP. If the third quarter was another weak...
Jutia Group  Oct 14  Comment 
[at Bloomberg] - Yahoo! Inc. (YHOO) is closing its office in Amman, Jordan, as the Web portal cuts back on its international operations. Yahoo, which announced the closing of the office today, said relocations will be offered to some employees....




 

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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