Yahoo releases first quarter results
Microsoft withdraws proposal to acquire Yahoo
Yahoo reported first quarter financial results Tuesday, reporting revenues of $1.9 billion, a 9% year-over-year increase.
“[These results] are all the more remarkable when you take into account the recent economic environment and the uncertainty stemming from Microsoft's unsolicited proposal,” said Yahoo CEO Jerry Yang in a conference call on April 22.
During the conference call, Yang stressed that after careful evaluation, the board still believed that Microsoft's unsolicited bid “substantially” undervalued Yahoo. Microsoft initially offered to purchase Yahoo for $31 a share earlier this year. However, the Yahoo board is open to any or all alternatives, including a sale to Microsoft, Yang said.
In the meantime, Yang added that the company was “expeditiously” exploring a number of strategic alternatives to maximize stockholder value, including the pending rollout of AMP, its new advertising management platform. The company also has plans to further enhance its Panama search advertising platform, he added.
According to Yahoo, marketing services revenue for the company was $1.6 billion for Q1, a 7% year-over-year increase. Fee revenues equaled $245 million in the first quarter, a 21% increase over the same period last year. Gross profit for the first quarter was $1.1 billion, an 11% year-over-year increase. And Q1 operating income was $121 million, a 28% decrease compared to Q1 of 2007.
It is still unclear what Microsoft's next step will be, in light of Yahoo's Q1 results. The company declined to comment when contacted by DMNews.
“Like anything else, it just changes the drama one more time but it doesn't really change the core landscape,” said Michael Gartenberg, VP and research director at Jupiter Research, in response to the Q1 results.