Yahoo Inc.'s first-quarter revenue fell short of analysts' estimates, underlining chief executive officer Marissa Mayer's challenge in attracting advertisers even as the Web portal adds content and signs new partners.
Sales, excluding revenue shared with partner websites, fell 4 per cent to $1.04-billion (U.S.), missing analysts' average prediction of $1.06-billion, according to data compiled by Bloomberg. Profit before some costs was 15 cents a share, the company said Tuesday in a statement, compared with projections for 18 cents.
Ms. Mayer, who took the helm in 2012, has been focusing on Yahoo's mobile business, rolling out new online channels and striking exclusive content deals, yet she's still struggling to add users and boost the company's slice of Web-advertising budgets. As those dollars go instead to younger rivals such as Google Inc., Facebook Inc. and Twitter Inc., Yahoo's sales have dwindled to levels first reached in 2005.
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Shares of Yahoo slipped 1.5 per cent in extended trading. The stock, which dropped less than 1 per cent to $44.49 at the close in New York, has fallen 12 per cent this year.
While sales declined, the company said revenue from its emerging businesses – a set Yahoo calls Mavens, including mobile, video ads, native ads and its Tumblr blogging platform – expanded during the quarter. Mavens sales rose 58 per cent to $363-million from $230-million a year earlier. Mobile revenue climbed 61 percent to $234 million.
While shares have almost tripled under Ms. Mayer's leadership, much of that added value is tied to Yahoo's stake in Alibaba Group Holding Ltd., the largest Chinese e-commerce company. In January, Ms. Mayer unveiled plans to spin off the shares in a tax-efficient manner, a process that's slated for the fourth quarter.