Yahoo Home Page Revamp Coming Early
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The new home page, which has been on Yahoo's (NASDAQ: YHOO) roadmap for some time, is launching ahead of schedule, leading to speculation that the company could be looking to divert attention from a less-than-stellar second quarter.
But analysts aren't expecting a great quarter from Yahoo, which has been buffeted by the sustained declines in ad spending. Instead, they are looking for concrete signs that CEO Carol Bartz can execute on a turnaround strategy, which has seen layoffs, new senior management and fresh efforts to update one of the most popular destinations on the Web to thrive in the era of social computing.
The new home page is to offer a bevy of widgets enabling users to customize the layout and tap into some of the most popular destinations on the social Web with plug-ins that sync up with sites like Facebook and MySpace. A Twitter tie-in is also on the product roadmap.
The dozens of widgets Yahoo is making available will appear on the left side of the home page under the heading "My Favorites."
Yahoo is also in the process of redesigning its search page.
Despite Yahoo's waning profitability in recent quarters, the company remains one of the most popular destinations on the Web, operating a collection of sites that welcomed more than 151 million unique U.S. visitors in May, second only to Google (NASDAQ: GOOG), according to the most recent figures from online metrics firm comScore.
Yahoo is also looking to the new, more customized home page to boost revenue by offering advertisers better targeted, more personalized opportunities to reach consumers. While Yahoo lags well behind Google in search advertising, it sits atop the display advertising market, with a 13 percent of graphical ads on the Web appearing on its network of sites.
"With embedded widget-type functionality and prominent "what's hot now" type search links, we expect the re-design may result in a stickier homepage, increased inventory, as well as additional search queries for Yahoo," Broadpoint AmTech analyst Benjamin Schacter said in a recent research note. "We are quite bullish on the new homepage, but as always, it will come down to the execution, and we simply do not give the benefit of the doubt to Yahoo until the company earns it."
Noting that Bartz had "indicated the redesign has been a priority," Standard & Poor's analyst Scott Kessler said that "an earlier-than-expected deployment would be encouraging to us."
He added, "However, we wonder about the timing on the same day Yahoo is set to report Q2 results."
While the home page may be the biggest development that Yahoo is speaking to directly, analysts are also on the look-out for an announcement that the company has reached a deal with Microsoft (NASDAQ: MSFT) to partner on search and advertising.
On this evening's conference call, Yahoo executives are likely to be more interested in talking up the home page than fielding questions about a rumored tie-up with Microsoft, though many analysts have expressed support for such a partnership.
Yahoo is due to release its second-quarter numbers after the market closes this afternoon, and host a conference call with analysts at 5:00 pm ET.