With final bids due today, Yahoo reports huge loss, but revenue up ticks up ever so slightly
Large part of loss is due to change in the way TAC payments related to the Microsoft Search Agreement were recorded, as well as impairment charges related to Tumblr
The final bids for Yahoo’s core assets are due today, the same day that the company reported its second quarter earnings. Those earning are pretty scary, though they are partly do to a change in the way TAC payments related to the Microsoft Search Agreement were recorded.
In Q2, Yahoo lost nearly half a billion dollars – $489.7 million to be close to exact. Then, on top of this, the company took a non-cash goodwill impairment charge of $395 million and a non-cash intangibles impairment charge of $87 million related to Tumblr. Guess that one didn’t quite work out the way they thought it would.
If not for the charges and the accounting moves, the earnings report might not look so bad. But does it really matter? Soon Yahoo will be somebody else’s problem. CEO Marissa Mayer, though, contributed an upbeat quote for the earnings report, and why not, she’s about to get a huge golden parachute. Life’s good at the top, even when you prove totally over your head as an executive.
“With the lowest cost structure and headcount in a decade, we continue to make solid progress against our 2016 plan. Through disciplined expense management and focused execution, we delivered Q2 results that met guidance across the board and in some areas exceeded it,” said Marissa Mayer, CEO of Yahoo. “In addition to our efforts to improve the operating business, our board has made great progress on strategic alternatives. We are relentlessly focused on delivering shareholder value.”
What comes next is the unsealing of those bids, and it looks as if none of the legacy media companies have been drawn in – they have their own problems turning around their own companies, they don’t need another headache.
“The bidders for Yahoo’s operations include the telecommunications giants Verizon Communications and AT&T, several private equity firms and a Quicken Loans co-founder, Dan Gilbert, who is getting financial backing from Warren E. Buffett’s Berkshire Hathaway,” Vindu Goel and Michael J. de la Merced of The New York Times reported late last week.
Yahoo stock is pretty much flat in after-hours trading. Some outlets are saying that this quarter’s report represents a “miss” compared to investor expectations, others are even bleaker:
“Overall, a portrait of a dying business,” Recode’s Kara Swisher said. “Does anyone care? No. That’s because the only thing that matters is the status of Yahoo’s sale.”
Swisher is, apparently, not a fan.