Yahoo Online Ad Revenues Surge

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Yahoo reported strong revenue and profit growth during the second quarter, thanks to increased demand for search listings and online advertising.

The Sunnyvale, CA-based company reported $113 million of net income for the quarter on $609 million in sales, excluding money paid to partners of search unit Overture Services. Sales nearly doubled from the year-ago period and profits were up from $51 million. Much of Yahoo's growth came from online advertising.

Revenues from marketing services, which includes Overture and other online advertising, rose to $468 million, more than double the amount produced during the same period a year earlier. The total excludes the $223 million in revenue shared with Yahoo search partners. The figure was slightly below what some Wall Street analysts expected. Piper Jaffray, for example, expected marketing services to generate $472 million.

Yahoo said its marketing services growth was generated from new sales along with recent acquisitions, such as the Kelkoo comparison-shopping engine in Europe. Without acquisitions, Yahoo said marketing services grew 45 percent.

Yahoo's other revenue sources also showed growth.

Fees from subscription services totaled $104 million, up 49 percent.

It ended the quarter with 6.4 million paying subscribers, adding 600,000 in the quarter. Listings revenue amounted to $38 million, up 17 percent.

Yahoo ended the quarter with 146 million registered users, up 26 percent from a year earlier.


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