Yahoo! Inc. (NASDAQ:YHOO) has posted better quarterly earnings results than the most optimistic predictions of Wall Street analysts. Their adjusted earnings for the fourth-quarter is 25 cents for each share, while the analysts had said that it would be somewhere close to 21 cents. The revenue is $1.47 billion, as compared to the prediction of $1.38 billion. So Yahoo’s revenue per share has gone up by 13 cents over the same period of last year.
Yes, display advertisement prices have come down, but still, the firm was able to earn more money from display and search revenue. Yahoo could sell 4 percent more display advertisements, and their price-per-click for the advertisements also went up by 18 percent. Revenues from other business areas such as video, mobile, social, and native have also grown strongly. In the last three months of the year, Yahoo posted a profit of $162 million.
Yahoo Postpones Closing the Verizon Deal
Both Verizon (NYSE:VZ) and Yahoo should be happy with this performance. But is this going to delay the Verizon deal? That seems likely now, as Yahoo revealed on Monday the Verizon deal will be closed in the second quarter this year, and not the first. Last year, Verizon had agreed to buy the core internet assets of Yahoo in a $4.8 billion agreement. However, this was thrown into doubt after two huge data breaches at Yahoo were revealed late last year. The attack affected more than a billion customer accounts.
Verizon said they have to look into the agreement once again, after the revelations of the data breaches, and wait for the investigation results to come out. There was also speculation that Verizon might want to re-negotiate the price.
The Securities and Exchange Commission is looking into whether Yahoo should have reported the breaches earlier, as accused by some people.
Yahoo Needs More Time Before the Deal is Closed
Yahoo (NASDAQ:YHOO) now says they need more time because “work is required to meet closing conditions”. Marissa Mayer, the Chief Executive issued a statement saying, “Yahoo has continued to work with Verizon on integration planning for the sale of its core business. The opportunities ahead with Verizon look bright”.
The tech firm is now busy improving the security and restructuring. Yahoo has already closed down 22 offices and dumped more than 120 features and products. The workforce has been slashed by 18 percent. The business still owns a big stake of Alibaba, which it plans to keep after the Verizon deal goes through.