Yahoo's financial performance dissatisfactory: CEO

Terry Semel, Chief Executive Officer of Yahoo Inc., said he was dissatisfied with his company's financial performance after the company saw its net income drop by 38 percent.

In remarks published on Wednesday, Semel pledged "laser focus" on three priorities to close the profitability gap in search-based advertising, extend its advantage in graphical ads and "seize the lead" in social networking, video and mobile content.

Semel said Yahoo would continue with its broad approach, adding video until it was just as widespread as text.

"We're making a lot of deals," he said. "We have all the tools to do better."

His remarks gave investors some hope for a rebound, analysts said.

California-based Yahoo reported a net income drop by 38 percent on Tuesday, although its Internet portal reported an increase in third-quarter sales.

This was a second straight quarter of disappointing financial results.

Yahoo said its third-quarter profit fell 38 percent to 159 million dollars, or 11 cents a share, from 254 million dollars, or 17 cents, a year earlier, when stock options weren't counted as an expense under accounting rules.

Meanwhile, Yahoo sales rose 19 percent to 1.58 billion dollars, as had been projected last month.

Yahoo said it expected fourth-quarter sales after fees to partner sites to come in at 1.15 billion dollars to 1.26 billion dollars, up just 13 percent from the year before.

Yahoo also announced a 3-billion-dollar stock repurchase plan over the next five years.

To compete against its biggest rival, Google Inc., Yahoo had started testing a much-anticipated Web search system.

Although Yahoo still claims to own the most-visited site on the Web and remains the leader in e-mail and other Internet activities, the company is being squeezed by faster growth elsewhere.

Yahoo's strongest suit has been in display ads. But rapidly growing sites such as social networking gathering place MySpace and video clearinghouse YouTube have larger inventories of ad space to offer, and they are attracting more established brands than in the past.

The recent acquisition of those sites by powerhouses News Corp. and Google respectively put Yahoo in a worse predicament.

Source: Xinhua