Yahoo!'s new chief Scott Thompson 'not satisfied' by $1bn revenues
AFTER years spent putting an ill-deserved gloss on poor results, Yahoo! has changed its tune, by declaring its best performance in three years as unsatisfactory.
Scott Thompson, who became chief executive in January, said the company was not growing fast enough, despite surpassing analysts’ expectations.
“I’m not satisfied by the pace of top line growth and I won’t be satisfied until it is at least in line with the market,” he told analysts, adding that the commercial performance of its display advertsing business had not kept pace with improvements in the technology that underpins it.
Yahoo! grew first-quarter revenues to $1.08bn (€764.3m) putting it slightly ahead of the analysts’ consensus of $1.06bn, and marking the first year-on-year increase since 2008.
Mr Thompson said the company was on track to turn over between $1.03bn and $1.14bn in the current quarter, but admitted it had kept the forecast range deliberately wide because the business was still volatile.
Yahoo!'s strong performances from its portfolio of shareholdings helped to offset a 4pc decline in revenues in its core advertising business.
Colin Gillis, an analyst at BGC Partners, said: “Their minority stake in their investments is generating more profit than their core business. Here is the one piece that is always sad about Yahoo!.”
However, Mr Thompson said the company was still looking at selling its 40pc stake in Alibaba, the Chinese web giant with which it has had a chequered past. He said it was in active talks about a “simplified transaction structure” to help monetise the holding, which is valued at billions of dollars.
However, he added that Yahoo! has made little progress towards selling its stake in Yahoo! Japan to Softbank, which co-owns the business.
Mr Thompson is the fourth chief executive of Yahoo! in as many years, and replaced Carol Bartz, who was fired over the phone last September, partly because of her rocky relationship with Jack Ma, Alibaba’s chairman and founder.
At the time, Ms Bartz said she was “f----- over” by the directors of the company.