It's a new CEO and a new story at Yahoo. At least for a quarter.
Adjusted earnings per share rose to 35 cents during the third quarter ended September 30, up from 21 cents during the same period a year earlier. Sales fell to $1.2 billion from $1.22 billion a year earlier.
Analysts had expected Yahoo to post $0.25 in earnings-per-share on roughly $1.08 billion in revenue.
"Yahoo had a solid third quarter, and we are encouraged by the stabilization in search and display revenue," said newly-installed CEO Marissa Mayer, who oversaw her first earnings report at the company. "We're taking important steps to position Yahoo for long-term success, and we're confident that our focus on quality and improving the user experience will drive increased value for our advertisers, partners and shareholders."
Analysts are hoping to hear more from Mayer about her plans during a conference call scheduled this afternoon. A recent report from Credit Suisse noted that Yahoo has been a perpetual turnaround story. That's hardly hyperbole. Over the course of five CEOs, the company has continued to slip against competitors for display advertising with single digit growth compared to stronger double-digit growth from rivals.
One of the big problems plaguing Yahoo has been a long-running identity crisis with the company torn between its ambition to become a media company and its roots as a technology company. We may get a clearer picture soon. Over the weekend, Reuters reported that Mayer had decided on a technology-driven comeback plan, making use of the more than $2 billion in cash and securities it holds. (After selling its stake in Alibaba Group Holding, Yahoo says it will have about $4.3 billion at its disposal.) According to Reuters, one company in which Yahoo "appeared to show interest" is OpenTable, the online reservation site.
On the plus side, the company still reaches 700 million users globally and it offers several popular brands, including Yahoo Finance, Yahoo News, and Yahoo Sports. If the rumors are to be believed, it would fit in with the expectation that Mayer wants to accelerate Yahoo's corporate DNA and improve the quality of its myriad offerings.
So far, Mayer, appointed CEO on July 16, has failed to move the stock. The company's share price, which was $15.65 on the day Yahoo announced the Mayer news, has hardly budged since then, closing today at $15.77.