Yahoo! Inc rose in extended trading yesterday after demand for advertising helped third-quarter profit exceed analysts’ estimates.
Profit before some costs was 21 cents a share, the company said in a statement yesterday. That beat the 17-cent average projection of analysts, according to data compiled by Bloomberg. Sales, excluding revenue passed on to partner sites, fell 4.6 per cent to $1.07 billion, matching the average estimate.
Yahoo!, which has been grappling with rising competition from Google Inc and Facebook Inc for users and advertisers, benefited in the recent period from growing demand for online ads, even after firing chief executive Carol Bartz and beginning a review of its strategy. The board is exploring a “full range” of options for the company, interim chief executive Tim Morse said on a call with analysts yesterday.
“The company didn’t fall apart,” said Jordan Rohan, an analyst at Stifel Nicolaus & Co in New York. “Almost by definition that was greater than expected.” Yahoo! jumped as much as 4.3 per cent to $16.14 after the report yesterday. The shares had fallen 1.5 per cent to $15.47 at the close in New York. The stock has dropped seven per cent this year.
Net income attributable to the company fell 26 per cent to $293.3 million, or 23 cents a share, from $396.1 million, or 29 cents, a year earlier, Yahoo! said. Growth outside the US bolstered revenue. In Asia, revenue excluding sales passed to partners surged 20 per cent to $221.6 million. Sales in the Americas region dropped 12 per cent to $753.7 million.