Yahoo Financial Analysis

Yahoo Financial Analysis

Yahoo

Yahoo is a digital media company. Company provides online properties and services (Yahoo Properties) to users as well as a range of marketing services to reach and connect with users on Yahoo and via a distribution network of third-party entities, who then integrates company's advertising offerings into their Websites or other offerings. Company offerings fall into three categories that include communications and communities, which includes Yahoo Mail, Yahoo Messenger, Yahoo Groups, Yahoo Answers, Flickr, and Connected TV; Search and Marketplaces, which answers users' information through search results pages; and Media, which is designed to engage users with online content and services on the Web.

Yahoo was once the market darling, with a well-known brand and first mover advantage. Yahoo's "web portal" strategy of internet dominance - with Yahoo serving as the 'starting point' to the internet - lost favor to Google's minimalist style in 2005. In early 2008, Microsoft began aggressively pursuing Yahoo in an effort to make a more competitive rival to Google, which already controlled a large majority of the US market. What followed was a breakdown in the cohesion of Yahoo's leadership, the exodus of a number of senior employees and the replacement of Yahoo's CEO (Jane, 2008, 25-28). Yahoo's financial performance has lagged far behind its competitors for most of the past five years.

Under the leadership of Carol Bartz, Yahoo began turning around its fiscal situation in 2009. Yahoo made severe staffing cuts, primarily to its search engineering and client services teams. Yahoo's cost-cutting efforts helped push profit margins up, but did little to stem the company's declining revenue. Yahoo is expected to post annualized revenue growth of 4.1% during the five years to 2011, to $7.8 billion.

The Search Engines industry emerged from the dot-com bust as one of the most innovative and profitable businesses in the United States. In the five years to 2012, the Search Engines industry has been among the fastest-growing industries, with average annual revenue growth of about 11.5%. In 2012 the industry is expected to bring in $17.1 billion, a 14.6% revenue gain over 2011. During the past five years, 2009 was the only year that experienced a revenue loss, as businesses cut back on advertising during the Great Recession. However, the industry's brief downturn did little lasting damage. Search engines will continue to absorb market share from other advertising media, primarily due to lower cost and quantifiable efficacy. Over the five years to 2017, industry revenue growth is expected to slow to an average annual growth rate of 8.8% to total $26.1 billion.

Google

Google has been in the search engine industry since 1998, and it is now a one of the most successful companies worldwide. Google is the most used search engine worldwide because of its quality services.

Google Inc. was founded in 1998 by two graduate students at Stanford University, American Larry Page and Russian Sergey Brin. They have developed a novel method to analyze the linkages of hypertext - the algorithm BackRub, then renamed ...