After cutting over 2,000 job positions in the past year, Yahoo have announced that their third quarter profit has soared. Whilst sales fell to $1.5bn, a 12per cent decrease, cost saving exercises including shedding a large proportion of jobs meant that Yahoo saw earnings treble last years quarter, $186m compared with 2008’s $54m.
However, whilst Google continues to make increasing profit, Yahoo is still struggling to create sales whilst remaining as one of the world’s favourite web portals. With many advertisers choosing to move to smaller, emerging websites during the recession, Yahoo has failed in managing to secure the lucrative contracts that it needs to turn its user rating into profit. After co-founder Jerry Yang left earlier this year to be replaced with new chief executive Carol Bartz, and a $100m campaign to advertise the launch of their new home hub, Yahoo are hoping that its new image will create the profit increase it desperately needs.
Brigantine Advisors analyst Olin Gillis said “We knew the new management could drive some of the cost out of the system, but we want to start to see what can be done to have the company return to growth. This is a company that’s still very much in the process of being restructured. It’s a mild positive. They’re doing what they’re supposed to be doing.”
Meanwhile Yahoo and Microsoft’s deal continues to wait for approval from regulatory officials and isn’t expected to finalise until 2010.
