Kara Swisher

Recent Posts by Kara Swisher

Yahoo Stock’s Dead-Cat Bounce After Splashy CEO Pick — And Here Are the Slides Explaining Why

Let’s begin by saying it is not new Yahoo CEO Marissa Mayer’s fault that the stock of the company has done a whole lot of nothing since the announcement of her appointment Monday.

After all, she just arrived.

But despite a lot of huzzahs from Wall Street over the solid choice of the high-profile former Google exec — which was being hailed by some as the answer to all of the Silicon Valley Internet giant’s woes — Yahoo shares still closed down yesterday slightly, and continued to fizz in after-hours trading.

Message from investors: Exciting choice, but you still need to prove that there is some light at the end of what has been a very, very long and pitch-dark tunnel for Yahoo.

It’s easy to see why, if you take a serious gander at the second-quarter results Yahoo released – in living color below — yesterday. They show a company that faces very serious and perhaps overwhelming problems that even a superhero CEO choice will find difficult to overcome.

Year-over-year growth of its global properties nearly flat, compared to an 13 to 15 percent rise a year ago; U.S. core search queries down 17 percent; minutes spent on its media properties down 10 percent; flat revenue touted as a good thing, since it was not down, at least.

Not down is the new up? In the land of Yahoo, it is indeed.

As Doug Anmuth of J.P. Morgan noted perfectly in a post-earnings note about the challenges the new CEO faces:

“This will be Marissa Mayer’s task going forward with her strong focus on product innovation and the user experience, but we continue to believe it will be difficult to turn Yahoo! around given mostly deteriorating engagement metrics, structural headwinds in the display space, shrinking search share, and limited mobile traction in the U.S.”

One bright spot is the $2.4 billion in cash that Yahoo has salted away, money that Mayer can presumably go hog wild with to bring in a spate of potentially invigorating start-ups and entrepreneurs, making Yahoo fast friends all over tech.

There is nothing like spreading around a lot of dough to make yourself popular again! And VCs become your BFFs!

That’ll come soon enough, but Mayer started just yesterday at Yahoo, and wisely bowed out of its analyst earnings call, with the company’s CFO Tim Morse noting that she needed to get up to speed on the state of the company before speaking out.

She needs to move fast, since sources said the signs for the third quarter are not promising, either, with Yahoo declining to provide guidance until Mayer can get a handle on the overall trends.

A handle that will take, it seems from the numbers below, a decidedly kung-fu grip:

YHOO_Q212EarningsPresentation


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Just as the atom bomb was the weapon that was supposed to render war obsolete, the Internet seems like capitalism’s ultimate feat of self-destructive genius, an economic doomsday device rendering it impossible for anyone to ever make a profit off anything again. It’s especially hopeless for those whose work is easily digitized and accessed free of charge.

— Author Tim Kreider on not getting paid for one’s work