Another quarter and Yahoo’s still in turnaround

Mark Garrison Oct 21, 2015
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Another quarter and Yahoo’s still in turnaround

Mark Garrison Oct 21, 2015
HTML EMBED:
COPY

Things keep getting worse for long-struggling tech company Yahoo. This week, it reported third-quarter revenue and profits that fell short of expectations.

The company said it’s also losing tens of millions on its heavily hyped programming efforts, which include the acquisition of the canceled NBC show “Community.” And, in an acknowledgement that its search and ad targeting businesses also aren’t performing well enough, Yahoo is making a deal with Google to do those very things for Yahoo’s users.

It’s the latest in a series of downers for CEO Marissa Mayer, who was brought in three years ago with great fanfare to turn the company around.  She’s been there long enough for some investors to call for her head.

But it’s possible the company’s problems are bigger than any leader can fix.

“I’m personally not sure Yahoo has many CEO changes left,” said Kartik Hosanagar, a Wharton School professor who follows the digital economy. “They’ve been through a series of CEO changes. Marissa Mayer is as big a name as one can get.”

A big chunk of Yahoo’s value is its stake in the giant Chinese e-commerce company Alibaba, worth about $27 billion. Once that’s spun off, that’s one less piece of good news Mayer can deliver every quarter. And then the pressure for a turnaround gets even tougher.

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