Beating analyst expectations again, Yahoo (YHOO)
turned a profit for its third consecutive quarter.
Net income for the second quarter ending
June 30, was $610,000 or 2 cents per share, compared to a net loss of $1.4 million, or 5 cents per share for the second quarter of 1996.
Analysts were expecting a loss of 1 cent a share, according to First Call.
The search engine leader kept up with the past two consecutive quarters when it also surprised Wall
Street with profits. Analysts expect the company to
have sustainable profits from this point on.
Tim Albright, an analyst with Cowen and
Company, who had expected the company to dip into the red was confident that the company would be profitable from here on out.
"They are incredibly bottom line focused and the management is good," he said.
Revenue grew to $13.5 million for the quarter, up fourfold from last
year's revenue of $3.3 million.
Albright has a 6-to-12 month price target of $48 a share and has the
company rated as "strong buy." Yahoo's stock jumped over its own record
high, closing up 4-1/4 points from yesterday's close of 39-3/4. The stock
gained as much as 13-1/2 percent during trading.
During the quarter, Yahoo and Netscape teamed up to offer Netscape Guide by Yahoo, in
which Yahoo would produce a section of Netscape's heavily trafficked Web
site that helps users locate news and other information on the Web. The
company also added several new services in the second quarter, including
Yahoo Finance which gives users
access to online trading services.
Yahoo also shelled out a $5 million one-time fee and committed to
generating at least $25 million for Netscape in advertising revenue over
the next two years.
Yahoo's traffic grew to an average of 38 million page views per day during
the month of June,
up from 30 million page views per day average reported in March.