Yahoo’s losses widened significantly year-on-year in its second quarter as it provided no update on the sale of its core internet business.
Losses at Yahoo hit $440m in the second quarter, up from $22m compared to the year ago period, while revenues increased from $1.24bn to $1.31bn year-on-year.
However, the increase in revenues was in large part due to a change in how firms present their results related to the Eleventh Amendment to the Microsoft Search Agreement.
Search revenue at Yahoo was $711m for the second quarter of 2016, compared to $528m for the previous period. The change in revenue presentation rules contributed an additional $252m to search revenue in the second quarter of 2016.
When the changes are stripped out, search revenue decreased 13% year-on-year.
Yahoo boss Marissa Mayer disappointed shareholders by providing no update on the progress of the sale of the company’s core internet business.
Mayer said: “With the lowest cost structure and headcount in a decade, we continue to make solid progress against our 2016 plan.
“In addition to our efforts to improve the operating business, our board has made great progress on strategic alternatives. We are relentlessly focused on delivering shareholder value.”
Yahoo is currently under pressure from shareholders and hedge fund investor Starboard Value has called for the entire board of the company to be replaced.
Parties interested in making a bid were given a deadline of 18 April to submit offers.
Yahoo also announced earlier in 2016 that it would cut 15% of its employees in an attempt to return the company to profit, as shares have fallen by around 30% since 2014.
“The one change that we might get is that there’s no change,” he says. “All we know is that there’s a process.”
Yahoo UK managing director Nigel Clarkson previously told M&M Global in April that, despite the turmoil, the company’s “big message is that it’s business as usual”.
“Who knows what the next few months will bring, and if the next few months bring a decision, that could still take months to create,” said Clarkson. “The reality is that we’re a business that generates $5bn in revenue a year and we’re touching over a billion customers. We’re one of only three businesses in the world that has access to a billion customers or more, so we’re just going to keep going. That’s all that you can do.
“If somebody buys us or if we choose to stay as a business, we’re doing it because we’re a business that generates a lot of money and we have some great touch points for customers.”
During its second quarter trading update, Yahoo also revealed its mobile revenue represented 22% and 30% of traffic-driven revenue in the second quarter of 2015 and 2016 respectivey.
Excluding the impact of the change in revenue presentation, mobile revenue would have been $259m and represented 26% of traffic-driven revenue in the second quarter of 2016.
Gross mobile revenue for the second quarter of 2015 and 2016 was $415m and $414m respectively.