Yahoo second quarter profit dropped 2.3 percent to $160.6 million on 11 cents per share from net income of $164.3 million on 11 cents per share in the year-ago period.
The dip, which securities analysts expected, continued a bout of struggle for a company that has seen many management and structural changes in the last several months.
However, sales for Q2 came in at $1,698 million, an 8 percent increase compared to $1,576 million for the same period of 2006.
Moreover, new CFO Blake Jorgensen told investors on the call that revenue from search marketing on sites owned and operated by Yahoo grew 25 percent when compared to the same period last year.
However, Yahoo also lowered revenue expectations for the full year, as Jorgensen said he expects sales between $4.89 billion and $5.19 billion. Analysts polled by Thomson Financial had been expecting full-year sales of $5.19 billion.
Investors reacted to the news with dissatisfaction and Yahoo
shares lost 3 percent in late trading. On a conference call with analysts, Yahoo co-founder and recently appointed CEO Jerry Yang admitted the Internet portal has work to do.
“There is a significant gap from where Yahoo is and where Yahoo needs to be,” Yang said.
Overall, company officials remained optimistic of a turnaround, largely thanks to the new Panama search-marketing platform. Yahoo President Susan Decker, who was promoted from CFO when Yang took over as CEO, hinted at more good news still to come.
Decker said Panama’s U.S. adoption produced record levels of revenue-per-search (RPS) and daily revenue for Yahoo.
During the company’s conference call to announce its final 2006 financial results, Decker had suggested that Panama’s complete adoption would lead to increased profitability for the company, beginning in the second quarter.