Feeds

Yahoo! thanks! Asian! equity! for! 36! PERCENT! income! boost!

Irony police circle as Jerry Yang's far-sighted deal buys Mayer more time

The essential guide to IT transformation

Yahoo! has beaten Wall Street expectations by reporting a 36 per cent year-on-year increase in net income last quarter, but CEO Marissa Mayer has investments in Yahoo! Japan and Chinese e-commerce giant Alibaba to thank for the respite.

The ailing firm has been undergoing a minor renaissance since the former Googler took over at the helm and seemed to continue this with net income rising to $390 million (£253.9m) in Q1 2013.

However a closer look at the balance sheet shows that a whopping $217.6m (£141.7m) of this figure came from Yahoo!’s equity in businesses in Asia.

It currently has a 33 per cent stake in Yahoo! Japan, the web portal biz it set up with mobile operator Softbank back in 1996, and 20 per cent of China’s hugely successful Alibaba Group.

Even the income injection these equity interests brought, however, wasn’t enough to disguise the fact that Yahoo!’s revenue dropped seven per cent year-on-year to $1.14bn (£742m), with display ads in particular down a worrying 11 per cent to $455m (£296m), worse than analyst expectations.

Mayer will have her work cut out turning that part of the business around in the face of fearsome competition from Facebook and Google, but Alibaba’s continued success will give her more time, especially to come good on plans to build out Yahoo!’s mobile business through acquisition.

Privately-owned Alibaba is valued at something like $14bn (£9bn) now and although Yahoo! has already cashed in half of the stake which co-founder Jerry Yang invested back in 2005 in return for an impressive $7.6bn (£4.9bn), it will keep the remaining 20 per cent until Alibaba goes public.

When that will happen is still not clear, although Mayer will certainly be hoping not this side of 2014.

Rumours have already been circling that Alibaba could hand back the Yahoo! China brand next month, as it looks to put more distance between the two and ditch what has become an increasingly marginalised part of its business. ®

Next gen security for virtualised datacentres

More from The Register

next story
BBC: We're going to slip CODING into kids' TV
Pureed-carrot-in-ice cream C++ surprise
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
Twitter: La la la, we have not heard of any NUDE JLaw, Upton SELFIES
If there are any on our site it is not our fault as we are not a PUBLISHER
Facebook, Google and Instagram 'worse than drugs' says Miley Cyrus
Italian boffins agree with popette's theory that haters are the real wrecking balls
Sit tight, fanbois. Apple's '$400' wearable release slips into early 2015
Sources: time to put in plenty of clock-watching for' iWatch
Facebook to let stalkers unearth buried posts with mobe search
Prepare to HAUNT your pal's back catalogue
Ex-IBM CEO John Akers dies at 79
An era disrupted by the advent of the PC
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Endpoint data privacy in the cloud is easier than you think
Innovations in encryption and storage resolve issues of data privacy and key requirements for companies to look for in a solution.
Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?