Yahoo! Inc. (NASDAQ: YHOO) has posted its earnings of $0.10 non-GAAP EPS and $1.136 in ex-TAC revenues. Thomson Reuters had estimates at $0.08 EPS and $1.14 billion in revenues. Guidance is for operating income of $330 to $370 million on revenues of $1.45 to $1.55 billion for gross revenues, which is before backing out the TAC revenues. Estimates for next quarter are $0.08 EPS and $1.17 billion in revenues.
The problem with the earnings here is that the guidance that is offered is soft, and the company’s metrics are not showing any sign yet that revenues are turning the corner. The company ended with close to $4.2 billion in cash and equivalents at the end of the quarter.
The external issue is even larger, so we are considering this “unofficially as unfinished business until after the earnings conference call.” There is no Microsoft Corp. (NASDAQ: MSFT) announcement here about any Ad-Search swap pact. If there is no Microsoft pact, then traders are not going to care about the quarter nor about the guidance.
Shares closed down 1.5% at $16.75 and the 52-week range is $8.94 to $22.48. Shares are trading down at $16.15 after the report. Based on how much these shares are up from lows two weeks ago, that is probably a lot ‘less-bad’ than the reaction could have been.
JON C. OGG
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