Search Drives Cautious Growth For Yahoo

January 29, 2013 Source: Ad Week


Yahoo CEO Marissa Mayer has a bit of cautious celebrating to do, as the 18-year-old company's notable revenue slump seems to have come to an end. During her second earnings call as CEO of the company Monday, Mayer unveiled that Yahoo's 4th-quarter revenue increased by 2 percent, the company's first yearly revenue growth in three years. 

And, what's cause for this 'Mayer bump' in revenue? Well, as Mayer guessed during the company's October earnings call – search advertising is on the rise. Search advertising revenue rose 4 percent year-of-year for Yahoo, while the company's display advertising revenue fell three percent over the same period, according to Ad Week

While search is driving some growth in Yahoo's revenue, the slight fourth-quarter increase in display ads sold didn't mitigate the continued free fall of Yahoo's display-advertising revenue. How is Yahoo trying to mediate the sluggish cash flow? By charging more of its inventory, Ad Week's Tim Peterson notes. 

“It’s unclear how soon Yahoo’s display business could rebound,” Peterson said. “While the number of ads sold on Yahoo properties decreased by 10 percent year-over-year, the price per ad increased by 7 percent.”

And, even with positive search numbers, the company's growth lags behind its biggest competitor Google, which, according to Peterson, brought in a higher pay-per-click than Yahoo, quarter-over-quarter. 

As for continuing the increasing numbers, Mayer says encouraging increased use of the site, drawing in a wider range of users, and appealing to international markets, are atop Yahoo's priorities, according to BizJournal. While accomplishing these goals may not be the easiest feat, confident employees can make the trek to success a bit easier for the company.

Surveys of the company's 11,000-plus employees found that company confidence rose by almost a third quarter-over-quarter, according to Forbes

“According to benchmark data across industries, this type of rising confidence in such a short period of time is unprecedented for any company,” Mayer said. 


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