Those expecting to see a dramatic change in anything at Yahoo yet are simply asking too much. We just learned of the layoffs in recent months and nothing confirmed until the beginning of April. Now that we've made it through some layoffs and know a little of CEO Scott Thompson's plans, we'll have to see what the reorganization brings to the organization's bottom line.
First quarter revenue and earnings really don't look very different from the same quarter last year. Notable changes include an 11% increase in income from operations, a 28% increase in Net earnings from $223 million to $286 million, and Net earning per diluted share up from $0.17 in Q1 2011 to $0.23 in Q1 2012 (38% increase). Not to say that these aren't good numbers, but there's still much work to be done before the results of the fat trimming can be recognized in the eyes of shareholders.
Yahoo CEO Scott Thompson comments on the results from the first quarter:
“In the first quarter, Yahoo!’s results came in at the high end of our guidance range and beat consensus on revenue and profits,”
“We also made changes to resize the organization and establish a new leadership structure to quickly deliver the best user and advertiser experiences at scale.”
Here's some of what Yahoo has going for it going into the second quarter of 2012:
* Yahoo! established a new leadership structure, organizing into three main groups – Consumer, Technology and Regions – bringing resources closer to users and advertisers.
* Yahoo! is home to 11 number one properties and ranks in the top three in 21 categories in the U.S. (comScore, U.S., March 2012)
* Yahoo!’s worldwide visitors during January and February grew 7 percent year over year with minutes spent increasing 14 percent in communications and communities and 8 percent in media properties. (based on comScore, Worldwide data)
* Yahoo! debuted a variety of original comedy Web shows as a part of a collaborative effort between Yahoo! and top-tier production partners. New shows include "First Dates With Toby Harris" featuring Seth Morris (Funny or Die); "Sketchy" (Electus/Principato-Young Entertainment), and "7 Minutes in Heaven" with "Saturday Night Live" writer Mike O'Brien (Broadway Video).
* Yahoo! also debuted the new ABC-produced daily series, “Power Players,” on Yahoo! News, featuring an ABC and Yahoo! News analyst team, and "Remake America," a new weekly video series that follows the lives of six real families as they strive to get back on track towards achieving "the American dream."
* Yahoo! announced the implementation of a Do Not Track (DNT) header solution that will be accessible across Yahoo!'s global network by early summer.
* The Yahoo! Board appointed five new independent directors: Alfred Amoroso, former President and CEO of Rovi Corporation; John D. Hayes, Executive Vice President and Chief Marketing Officer of American Express Company; Peter Liguori, former Chief Operating Officer of Discovery Communications, Inc. and former Chairman and President of Entertainment of Fox Broadcasting Company; Thomas J. McInerney, former Chief Financial Officer of IAC/InterActiveCorp; and Maynard Webb, Chairman of LiveOps, Inc.
* To protect the investments of Yahoo! and the inventions of its employees, Yahoo! sued Facebook for infringement of ten patents. Yahoo! has invested substantial resources over many years to innovate and earn this intellectual property and the lawsuit is intended to enforce Yahoo!’s rights.
Thompson reveals his thoughts on how Yahoo has been operating:
“Yahoo has built processes that were originally intended to help us scale but they’ve become way too complex and stifled innovation,”
“Each of our products and services may individually generate more engagement than most start-ups…but that does not mean we should continue to do everything we currently do,”
“Yahoo has been doing way too much for too long and was only doing a few things really well,”
“We need to be clearer going forward about what we won’t do,”
Plans to shutdown over 50 properties at the firm:
According to Tech Crunch (TC), Thompson has plans to trim 50 properties from their current operations. While this action may cut revenue it will increase margins overall. Yahoo will still be involved in creating new products, but it sounds like Thompson is focused on refining what they already have.