Yahoo! lays out new strategy

2012-10-23 19:09

San Francisco – Yahoo! chief Marissa Mayer on Monday revealed a revival strategy that includes making a priority of delivering the internet firm's popular online services to smartphones and tablets.

Freshly returned from maternity leave after giving birth to a boy just a few weeks ago, Mayer used an upbeat quarterly earnings release conference call to lay out her vision for returning the faded internet pioneer to glory.

Mayer, who took over in July at Yahoo! after 13 years at Google, said her first 100 days at the Sunnyvale, California company "have been a lot of fun".

"This job is tailor-made for me," Mayer said while taking part in her first Yahoo! earnings conference call.

"We have been zeroing in on the efficiency and well-being of employees," she continued. "Companies are all about people. The companies with the best talent win."

Along with removing bureaucracy and laying out monthly goals for employees, Mayer has bolstered morale with perks such as free meals on campus and free Apple or Android smartphones.

The smartphones also serve to focus Yahoo! workers on adapting the firm's websites and services to mobile devices being woven ever more tightly into modern lifestyles, according to Mayer.

"Our vision is to make the world's daily habits inspiring and entertaining," she said, referring to the ranks of people whose routines include turning to Yahoo! for sports results, news, email and more.

"Mobile represents not only a daily habit but a platform shift we have to ride in order to be relevant."

Yahoo! has failed to capitalise on the opportunity presented by people using smartphones or tablets to connect with the internet, which is now a top priority at the company, according to Mayer.

"We do need more mobile engineers here," Mayer said. "It is clear that at some point in the future Yahoo! will have to be a predominately mobile company."

Mayer echoed the mantra of predecessors who maintained that the company could find prosperity by mining information about users to insightfully tailor online content and target money-making advertising.

"While we have a lot to do, the future for Yahoo! is incredibly bright," Mayer said. "No one wants Yahoo! to grow more than the people who work here."

Mayer has put in place hand-picked executives she described as her "dream team" and said the company is keen to hire talented engineers adept at software for mobile devices.

She also said she was devoted to Yahoo! making its own content, citing success with original news coverage of the Olympic Games in London.

Cash pumped into Yahoo! coffers from the sale of part of its stake in Chinese e-commerce giant Alibaba will be used to buy back stock, but some will be kept to acquire promising small technology firms, the company said.

Yahoo! on Monday reported that its quarterly profit rocketed above $3-billion fuelled by Alibaba reclaiming its stock.

Yahoo! still owns about 24% of Alibaba Group's outstanding stock, according to the California firm's newly-hired chief financial officer Ken Goldman.

Revenue from display advertising was little changed from the same quarter last year but Yahoo! reported its income from ads served up with online search results was up 11% thanks to a revenue-guarantee deal with Microsoft.

Yahoo! in 2009 began letting Bing handle the labour-intensive job of finding and indexing content on the internet, freeing itself to concentrate on interesting or personalised ways to present results.

The earnings topped Wall Street expectations and Yahoo! shares climbed more than 4% to $16.49 in after-market trading on the Nasdaq.

"We have much work to do and this will take some time, but the evidence of stable financial growth is beginning to show this quarter," Goldman said.

It has been trying to reinvent itself as a "premier digital media" company since the once-flowering internet search service found itself withering in Google's shadow.

The Yahoo! share of overall US online ad revenue has slipped slightly more than a percent to 8.4% since last year, according to eMarketer.

"The fact that Marissa Mayer is building a loyal team and focusing the company on something consistent with her skill set is good news," said analyst Rob Enderle of Enderle Group in Silicon Valley.

"Expecting her to do a lot more in so little time is a stretch."