Yahoo make a huge loss

YAHOO swung to a fourth-quarter net loss as the company recorded over $US600 million ($903 million) in unusual charges and total revenue took a hit from falling international sales.

The internet company reported a net loss of $US303.4 million, or 22 cents a share, compared with net profit of $US205.7 million, or 15 cents a share, a year earlier. Excluding items, earnings rose to 17 cents from 13 cents.In the quarter, Yahoo recorded $US108 million for restructuring charges, a $US488 million goodwill impairment charge related to its international segment and a charge of $US7 million to pay advisors related to strategic proposals with Microsoft and Google.

Total revenue decreased 1.4 per cent to $US1.81 billion. Revenue excluding traffic-acquisition costs dropped 2 per cent to $US1.38 billion, compared with the $US1.37 million expected by analysts.

In October, the company expected total revenue of $US1.77 billion to $US1.97 billion.

International revenue dropped 10 per cent, while US revenue climbed 2 per cent.

Chief executive Carol A. Bartz, who replaced co-founder Jerry Yang as CEO earlier this month, said the company made important investments while managing costs, putting the company in a better position to weather the economic downturn.

Looking ahead, Yahoo expects first-quarter total revenue of $US1.53 billion to $US1.73 billion.

Yahoo, which has struggled against Google due to its exposure to the slumping display-advertising market, has cut its work force by at least 10 per cent and instituted a wage freeze in an effort to contain costs. The company also hopes to ramp up revenue in its search and other performance-based advertising as it continues a difficult turnaround effort during the recession.

Meanwhile, speculation of a deal between Yahoo and Microsoft renewed after Ms Bartz’s appointment, and last week Ms Bartz confirmed she spoke with Microsoft Chief executive Steve Ballmer, but didn’t provide details of her conversation with Mr Ballmer.

The Microsoft deal wasn’t the only offer to fall through recently for Yahoo, as an advertising partnership with Google fell apart in November in the face of opposition from antitrust regulators.

Shares were up 3.2 per cent to $US11.70 in after-hours trading. The company’s stock has tumbled over 60 per cent from its 52-week high in February.

The Wall Street Journal