Web corporation Yahoo has posted profits of $331 million for the three months ending 30 June – a 46% increase from the $226.6m recorded for the same period last year. The figures have come as a vote of confidence for the leadership of Marissa Mayer, who joined the firm in July 2012 as its third chief executive in a year, with company profits and morale at an all-time low.
Since then, the 38-year-old mother – who was pregnant when hired and went back to work just two weeks after giving birth – has been determined to refocus the brand, specialising in the development of mobile data and video to win back users’ attention. The former Google employee originally made her name by leading the development of Gmail and Google Maps, and since arriving at Yahoo she has enforced an aggressive strategy of revamping its web pages, buying other technology firms and launching new products.
In just 12 months, the firm has completed 17 deals, including the $1 billion acquisition of major blogging site Tumblr and the $30m purchase of Summly, built by London teenager Nick D’Aloisio – a mobile app that summarises online news content. Mayer has also worked to change the culture within the company and has banned her 11,500 employees from working at home, raising eyebrows among working mothers with have childcare responsibilities.
While Mayer noted in a statement that she was encouraged by Yahoo’s “continued stability,” she will know more than anyone that the company still has many more challenges ahead before it can compete once again with the likes of Facebook and Google. Despite the glowing profits report, Yahoo’s Q2 net revenue totalled $1.07bn – slightly lower than last year. Commentators have suggested that the profits are in fact a result of significant cost cutting, which have driven operating expenses down by 14% to $998.3m.
Most concerning of all, though, is the tech giant’s continued struggle to grow its advertising revenue – a core part of its business. The firm’s display-ad division saw an 11% fall during Q2, and price-per-ad revenue decreased by about 12%.
Image of Yahoo’s redesigned Flickr page from May 2013 courtesy of AHMAD FAIZAL YAHYA / Shutterstock.com