Yahoo (YHOO) Suffered A Huge Quarterly Loss

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Despite beating the Street’s revenue projections, Yahoo suffered a huge $440 million quarterly loss in the second quarter.
The company posted 1.3 billion in revenue in the second quarter while Wall Street had expected Yahoo to just bring in $1.08 billion in revenue. This was after the troubled internet company only made $1.2 billion in the second quarter of last year.

The cost of acquiring web traffic more than doubled to $466 million from $200 million in the second quarter of last year. When subtracting those expenses, Yahoo was left with $841 million in net earnings, a substantial drop from the $1 billion of the same quarter last year.

Yahoo announced earnings of 9 cents per share for the quarter but analysts had expected 10 cents. The company had reported 16 cents in the second quarter of 2015.

Net advertising revenue from the firm’s search service fell to $319 million in the second quarter from $422 million in the same period last year. Net display advertising revenue dropped to $396 million from $410 million.

Yahoo wrote down $482 million in charges related to its social media site Tumblr due to reductions in projected operating results and cash flows. This was the main force in Yahoo’s huge $440 million quarterly loss.

Final bids to acquire Yahoo were reportedly due on Monday this week but CEO Marissa Mayer said in the earnings report conference call that she would not disclose details. She did however say the company was “deep into the process” of evaluating proposals.

Disclaimer: We have no position in Yahoo! Inc. (NASDAQ: YHOO) and have not been compensated for this article.