top | item 12118644

Yahoo misses profit expectations in what could be its last-ever earnings report

129 points| bane | 9 years ago |washingtonpost.com | reply

148 comments

order
[+] shams93|9 years ago|reply
Its taken them a while, all their peers except for Amazon have essential gone to the dust. If Geocities had been bought by say Google instead of Yahoo I could have easily flipped my options into my own startup. However dot bomb hit so hard instead of wealth I was left holding a huge capital gains tax bill that forced me into 10 solid years of hardcore poverty as most of my income was confiscated to pay off the debt. Not a nice outcome for companies bought by yahoo back in the 90s!
[+] a_small_island|9 years ago|reply
Have you written more about this? I would love to read more details.
[+] themartorana|9 years ago|reply
How do you not make money and still owe a lot in capital gains?
[+] encoderer|9 years ago|reply
Ugh. The era before amt credits was bleak.
[+] retube|9 years ago|reply
oh man the US tax code is so f*cked
[+] dexwiz|9 years ago|reply
Has there ever been a successful turnaround of a software company of Yahoo's scale? Mayer has been tech news' pinata for over a year now, but the company was sliding before she was even hired. Looking through a list of dead Yahoo services, it reads as an obituary of region specific social networking sites and forgettable web services[1]. Social sites are notoriously fickle, and boosting one to popularity is somewhat of a dark art. Web services are a dime a dozen, and Google or Facebook probably has a better one. Yahoo seemed like it failed to break into any enterprise offerings either.

Poor leadership, and failure to attract talent. They didn't have the same culture pull as Google/Facebook/Apple in the latest tech bubble. And why work for Yahoo if you could do the same thing with VCs funneling you money? I think one of the most telling things is the lack of OSS from Yahoo. Their top repo on github has been effectively dead for around a year [2]. Yahoo hasn't been a tech company is almost a decade, and it shows in their products. Not even their numerous acquihires have netted them anything.

EDIT: Looking at a timeline of Yahoo, they haven't launched a major product since 2006 (10 years). All new products have been bought [3]. Imagine if Google's last product was Docs. No Android, no Doubleclick, no Street View, no autocomplete in search, no Chrome.

[1] https://en.wikipedia.org/wiki/List_of_Yahoo!-owned_sites_and...

[2] https://github.com/search?o=desc&q=user%3Ayahoo&ref=searchre...

[3] https://en.wikipedia.org/wiki/Timeline_of_Yahoo!#2006

[+] cpeterso|9 years ago|reply
> Imagine if Google's last product was Docs. No Android, no Doubleclick, no Street View, no autocomplete in search, no Chrome.

Android, DoubleClick, Google Maps (Where 2, ZipDash), Google Earth (Keyhole), and Google Docs (Writely, 2Web, Tonic, DocVerse, Quickoffice) were built of acquisitions, not new Google products. Chrome, too, in a sense (WebKit).

Thought experiment: what if Yahoo!, not Google, had acquired all those companies instead?

[+] nostromo|9 years ago|reply
Apple, of course. It's probably the biggest turn-around story of our time.
[+] dailo10|9 years ago|reply
Regarding OSS - Yahoo was behind Hadoop, the platform for big data and distributed computing. HBase, Spark, Storm, etc. are all built on top of Hadoop. Gotta give them credit for that one.
[+] tomc1985|9 years ago|reply
That's harsh. There are a handful of top-notch products with great features that I would really like to see stay around in their current form. (Yahoo Finance and Flickr come to mind.)

Plus, while they are what they are now, you can't necessarily deny open-source contributions in the past. YUI is impressive in its scope, for one.

[+] jldugger|9 years ago|reply
> Has there ever been a successful turnaround of a software company of Yahoo's scale?

Intel and IBM come to mind.

[+] patmcguire|9 years ago|reply
No, but software companies of Yahoo's scale are either established within the past 20 years or Microsoft. That doesn't give a lot of time for things to go great, then get well and truly fucked, and then come back from the brink.
[+] jonknee|9 years ago|reply
> Has there ever been a successful turnaround of a software company of Yahoo's scale?

Is Yahoo a software company? They don't claim to be (I think it's currently a media company).

[+] swalsh|9 years ago|reply
Being first to market is rarely a long term advantage, it's more like a shot of adrenaline. Over time you build up technical, and structural debt. As the front runner you have to make all the mistakes, after you've made them a competitor can swoop in, avoid your mistakes, and outperform. You may not pivot because hey what you're doing seems to work, or you may avoid a pivot because you have too much technical debt. But it seems to prove itself over and over again to be a very weak advantage.

Yahoo finance sucks compared to google finance, yahoo search sucks to google search, yahoo content sucks. Yahoo mail sucks, yahoo shopping sucks. Everything they do is not as good, but they were one of the first to do it all.

[+] elgabogringo|9 years ago|reply
Has the valley ever seen a more hyped, yet disappointing hire than Mayer?
[+] cloudjacker|9 years ago|reply
Theranos.

The valley is very sensitive towards women running companies with large valuations, that company's woes would otherwise have flown completely under the radar. The next one on the "overhyped but disappointing and in the valley list" would be Clinkle and its now 24 year old CEO. No women there but as you will see the valuations drop off a cliff pretty quickly in this list.

[+] dredmorbius|9 years ago|reply
Carly Fiorina.

Yahoo was dead man walking before Mayer came on. She wasn't the right hire to save it, but she wasn't the hire that killed it.

Fiorina drove HP into the ground hard. It's survived, only barely, but no thanks to her.

And while both are women, I'd keep an eye on both Nadella (Microsoft) and Pichai (Google). Nadella's got a turn-around job. Pichai's starting from a better position, but with a company that's grown fat, lazy, distracted, and manifestly evil. I'd actually say Pichai's got the harder job, and I've not been particularly impressed.

(The fact that I had to look up each of their names to confirm spelling says something about the lack of billing either's getting.)

I'd argue too that Sculley at Apple was quite possibly Worst Hire Ever, in terms of total impact and lost potential. Latter proven by Job's return.

(That said as someone who's not particularly a fan of Apple or Jobs.)

Gil Amelio at SGI did spectacularly bad things rapidly as well.

[+] carterehsmith|9 years ago|reply
Carly Fiorina?

As per Wikipedia: "several commentators ranked Fiorina as one of the worst American (or tech) CEOs of all time"

Then as a punishment for being a shitty CEO: "In 2010, she won the Republican nomination for the United States Senate in California; "

Overall she looks like at least a good challenger to Myers.

[+] discardorama|9 years ago|reply
I don't know about hyped, but Carol Bartz (also at Yahoo) was the most disappointing. She single-handedly killed Yahoo faster than anyone else. Compared to her, Mayer is a genius.
[+] JonFish85|9 years ago|reply
If you're a Yahoo shareholder, you're probably not all that disappointed. I believe their stock price has roughly doubled. Regardless of whether that was purely due to Alibaba or not, with her at the top spot the investors have done quite well.
[+] aoiao|9 years ago|reply
Make them work on-site, problems solved.

-Mayer

[+] kmiroslav|9 years ago|reply
Jonathan Schwartz?
[+] trimbo|9 years ago|reply
Terry Semel
[+] nashashmi|9 years ago|reply
Yahoo's problem was that it was masquerading as a tech company when the only valuable asset it had in its books was its media side of the business. Yahoo had many media agreements, and it had developed much negotiating strength in that business.

Unfortunately, Yahoo also had these random properties like mail and games that made it difficult to forge one path.

Further, Mayer was someone who had reputation as a tech leader. She saw everything from a tech angle which made it difficult for her to direct the company in another direction apart from tech. This was the reason why Flickr and Delicious were being shutdown.

[+] ProfChronos|9 years ago|reply
When reading the article I was remembering the words of Dominique Vidal, former Yahoo MD Europe, quoted by Criteo's cofounder Rudelle in his book: "Yahoo had everything to be Google. But when we reached a peak of users, we stopped investing in R&D to focus on other expenses. That is the most terrible mistake we did". When you look at Google or Facebook and their R&D investments in non core-business projects, I am definitely thinking that someone got Yahoo's lessons right
[+] guard0g|9 years ago|reply
Poor execution, lack of innovation. At least Mayer can run for public office now...
[+] cloudwalking|9 years ago|reply
We have no idea what happened at Yahoo. They may have failed two years earlier without Mayer, for all we know.
[+] sp527|9 years ago|reply
I still remember when some were attempting to portray Mayers' demotion from the exec ranks at Google as sexism. In reality, Google had probably already recognized certain issues in her managerial style.
[+] throwaway6497|9 years ago|reply
Agreed. If Mayer was awesome, she would have been CEO of Google, infact she was best positioned to be one at some point. All the people she hired were getting promoted over her. She was pissed, obviously could never show it. Bided time and took up the CEO position at Yahoo. Anyone with big ego would. I wouldn't blame her. She did what is best for her. Just like any other economic actor. What I really felt bad for - Yahoo's employees and customers. Only qualified person who was willing to take up the job was Marissa. Rest were no-name hacks who had no idea how to build products. Board had no choice but to hire her. Hailing her as Obama with Obama change posters, I felt was a little over the top. Yahoo's employees were desperate. She improved morale initially. Had she shown results, she would have won huge loyalty from employees and board. She tried. Made some bold moves and failed. Not bad in my opinion. I wonder, if any other CEO would have made such bold product moves. Acquisitions - lots of them, mail, home page improvements, new redesigned apps, attempting to build an internal product for search. She at least tried. RIP yahoo.
[+] ddebernardy|9 years ago|reply
Whatever the price will be, it won't be the $44.6 billion MS offered back in the days. Shareholders are probably furious at Yang for turning that offer down.
[+] nojvek|9 years ago|reply
That would have been another shit move by Ballmer. He already destroyed Nokia and cost MS a fortune.

Let's hope LinkedIn brings value with a deeper integration in office.

[+] antoineMoPa|9 years ago|reply
"Yahoo"... The brand is the problem. It sounds like a good name for a personal website in 1998 (with 85 gifs and a turquoise background).
[+] RankingMember|9 years ago|reply
With the right products, I'm of the opinion that you can name your company just about anything and be successful. I mean is Google's name any better if you don't keep their products in mind?

Let's also not forget about GoDaddy, which for a time was successful with that name and hobbles along (operating at a loss) even today.

[+] codingmyway|9 years ago|reply
I still don't see why Yahoo didn't stick to their original purpose of human powered search instead of buying up random companies to try anything.

All they had to do was work out how to outsource the work to users. Why did they not buy StumbleUpon or PearlTrees, which few have heard of?

That and email would have given them a lot of data on their user base.

[+] l33tbro|9 years ago|reply
This is probably a really dumb question - but I have 17 years worth of Yahoo email. Most of it is for nostalgia, but how likely is it that this would be wiped away if/when Yahoo goes under?
[+] throwaway7767|9 years ago|reply
If you care about it, keep your own backups. This applies to all cloud services at all times.

The fact that you ask yourself this question now implies that you should really start preparing.

[+] jlgaddis|9 years ago|reply
The same question, from a different perspective: How likely is it that your mail would be kept (and remain accessible to you) if/when Yahoo! goes under?

I think I'd start making a local backup/copy of it.

Can you access it via IMAP? I'd recommend offlineimap or imapsync as starting points.

[+] imaginenore|9 years ago|reply
I doubt yahoo properties will just disappear. Too many users, too many ad views. They will likely be bought and supported.

But it's a good idea to back up your email anyway.

[+] joebergeron|9 years ago|reply
Sigh... "To keep reading, please enter your email address".

Welp.

[+] ars|9 years ago|reply
You should be able to press and hold the back arrow, click on the story directly and quickly press escape to stop the javascript that does that.
[+] aioprisan|9 years ago|reply
A bit dramatic of a title, no?
[+] jonknee|9 years ago|reply
How so? They put themselves up for sale and the deadline for final bids was today. They also missed profit and revenue forecasts, it was another ugly quarter for a quickly shrinking company.
[+] duaneb|9 years ago|reply
Dramatic? Yea. Click bait? Only for those who didn't know it was coming. Yahoo has a very meagre future as a company hoping to retain their revenue (let alone profit)