It Has Lost Its Competitive Edge
Yahoo’s value lies in its users, more than any sites other than Google and Facebook. But over the last decade it has lost advertising revenue and search traffic to those same companies.
U.S. visitors/viewers in May 2016
Google sites
242
million
1.
209
2.
Yahoo sites
204
3.
Microsoft sites
199
4.
Amazon sites
182
5.
Comcast NBCUniversal
158
6.
AOL
153
7.
CBS Interactive
145
8.
Apple
140
9.
128
10.
45
%
40
Google 39%
35
30
United States digital ad revenue share
25
20
15
Facebook 15%
10
5
YouTube 4%
Yahoo 3%
0
’09
’16
45
%
U.S. visitors/viewers in May 2016
Google sites
1.
40
242
million
Google 39%
2.
209
35
Yahoo sites
3.
204
30
United States digital ad revenue share
Microsoft sites
4.
199
25
Amazon sites
5.
182
20
Comcast
NBCUniversal
6.
158
15
Facebook 15%
AOL
7.
153
10
CBS Interactive
8.
145
5
YouTube 4%
Apple
9.
140
Yahoo 3%
0
10.
128
’09
’16
70
%
45
%
U.S. visitors/viewers in May 2016
Google sites
1.
40
242
million
Google 64%
60
Google 39%
2.
209
35
50
Yahoo sites
3.
204
30
United States web search engine share
United States digital ad revenue share
Microsoft sites
40
4.
199
25
Amazon sites
5.
182
20
30
Comcast
NBCUniversal
6.
158
15
20
Microsoft 21%
Facebook 15%
AOL
7.
153
10
Yahoo 12%
CBS Interactive
8.
10
145
5
YouTube 4%
Apple
9.
140
Ask 2%
Yahoo 3%
0
0
AOL 1%
10.
128
’07
’09
’16
’09
’16
The Company Is Shrinking
After years of tremendous growth, Yahoo’s revenue declined after the financial crisis.When Alibaba, a Chinese company in which Yahoo owns a 15 percent stake, went public in 2014, Yahoo profited handsomely — so much that the Alibaba shares are worth far more than Yahoo's business. Last year, Yahoo lost $4.4 billion as it restructured, including writing down the valuations of some of its brands like Tumblr, which it bought for $1 billion in 2013.
$2.0
billion
Yahoo’s
quarterly
revenue
1.5
1.0
0.5
0
’00
’05
’10
’15
+
$8
billion
Yahoo’s
annual
net income
+
6
+
4
+
2
0
–
2
$4.4 billion
loss in 2015
–
4
–
6
’00
’05
’10
’15
+
$8
billion
$2.0
billion
+
7
Yahoo’s
annual
net income
Yahoo’s
quarterly
revenue
+
6
+
5
1.5
+
4
+
3
+
2
1.0
+
1
0
–
1
0.5
–
2
–
3
$4.4 billion
loss in 2015
–
4
–
5
0
’00
’05
’10
’15
’00
’05
’10
’15
$2.0
billion
+
$8
billion
Yahoo’s
quarterly
revenue
Yahoo’s
annual
net income
+
6
1.5
+
4
+
2
1.0
0
–
2
0.5
$4.4 billion
loss in 2015
–
4
0
–
6
’00
’05
’10
’15
’00
’05
’10
’15
It Is Under Pressure From Shareholders
In 2012 Marissa Mayer, an executive at Google at the time, was hired as chief executive to revive the company after previous ousted chiefs had failed to bring the company back from the dot-com crash in 2000. After she took the helm, the stock price rebounded to its highest levels since the dot-com crash, but last year the company’s value eroded again.
2
1
3
Tim
Koogle
Terry
Semel
Jerry
Yang
Began shortly after Yahoo was incorporated
Stepped down under shareholder pressure.
Co-founder. Resigned under shareholder pressure.
4
6
8
Carol
Bartz
Scott
Thompson
Marissa
Mayer
Largely unsuccessful effort to turn the company around.
Fired after failing to revive the company.
Biography listed a bogus college degree.
$120
1
2
3
4
6
8
100
Tenure of each chief executive
80
Interim
chiefs
5
7
Yahoo’s
stock price
60
40
20
’96
’00
’05
’10
’15
2
1
3
4
6
8
Tim
Koogle
Terry
Semel
Jerry
Yang
Carol
Bartz
Scott
Thompson
Marissa
Mayer
Began shortly after Yahoo was incorporated in March 1995.
Stepped down under shareholder pressure.
Co-founder. Agreed to resign under shareholder pressure.
Fired after failing to revive the company.
His official biography included a bogus college degree.
Largely unsuccessful effort to turn the company around.
1
2
3
4
6
8
$100
Tenure of each
chief executive
Interim
chiefs
7
5
80
60
Yahoo’s
stock price
40
20
’96
’00
’05
’10
’15
$120
a share
Tenure of each chief executive
100
Tim Koogle
Terry Semel
Jerry
Yang
Scott
Thompson
Marissa
Mayer
Carol
Bartz
Began shortly after Yahoo was incorporated in March 1995.
Hired from Warner Brothers. Stepped down under shareholder pressure.
80
Co-founded the company. Agreed to resign under shareholder pressure.
Left after disclosure that his biography included a college degree he never received.
Hired from Google to turn the company around but has been largely unsuccessful.
Fired after failing to revive the company.
60
40
Interim chiefs
20
Yahoo’s stock price
0
’96
’00
’05
’10
’15
$120
a share
Tenure of each chief executive
100
Tim
Koogle
Terry
Semel
Jerry
Yang
Carol
Bartz
Scott
Thompson
Marissa
Mayer
80
Began shortly after Yahoo was incorporated in March 1995.
Hired from Warner Brothers. Stepped down under shareholder pressure.
Co-founded the company. Agreed to resign under shareholder pressure.
Fired after failing to revive the company.
Left after disclosure that his biography included a college degree he never received.
Hired from Google to turn the company around but has been largely unsuccessful.
60
40
Interim chiefs
20
Yahoo’s stock price
0
’96
’00
’05
’10
’15
