The Yahoo board has approved a massive $1.1 billion all-cash deal to buy Tumblr.

It’s not clear when the official vote was taken, but sources close to the board said the acquisition was a foregone conclusion and was unanimously approved by the directors of Silicon Valley Internet giant.

The deal will likely be announced Monday morning, said numerous sources.

AllThingsD.com initially broke the story of the acquisition efforts and later followed up with details of the exact price and the board meeting to approve the transaction.

There were no other competing bids, despite reports, to snap up the New York-based social blogging service. That said, Tumblr had held some very preliminary discussions about various deals with Facebook, Google, Microsoft and also Twitter earlier this year.

As part of the Yahoo deal, Tumblr CEO David Karp — who will get a windfall of cash from the acquisition — will stay at Yahoo for four years at least and retain a lot of control over the service, much in the same way Instagram CEO Kevin Systrom does at Facebook. But, as there, Yahoo will undergird Tumblr’s nascent advertising business with its large and established infrastructure, said sources.

Yahoo had been mulling some kind of deal with Tumblr, from a strategic investment to an outright acquisition, for about six weeks. Sources said that Yahoo CEO Marissa Mayer had decided that buying the company was going to be “the stake in the ground of what her strategy is going forward for Yahoo.”

And that is to attract younger audiences with just the kind of user-generated content Tumblr has pioneered to impressive growth.

According to numerous sources, Mayer determined quickly in her research that the site was just the kind of property that Yahoo needed to make it both “cool” and relevant to new consumers.

Yahoo is looking to bolster its strong set of existing media offerings to appeal to a different demographic and also get into the social space via consumer-based software solutions that are both elegant and easy to use.

Tumblr’s mobile usage has also been strong, which also interested Mayer. While Tumblr started as a desktop-based service, its mobile offering has ramped up quickly in the last few years. ComScore says that a quarter of the service’s U.S. visitors now come from mobile devices.

At this price, it will be Mayer’s biggest acquisition so far. Since she became CEO last summer, Mayer has made only a series of small acquisitions of mobile startups at a low cost.

According to sources, the Tumblr brand will continue.

The deal, if consummated, will be a big win for investors. In a series of fundings since 2007, Tumblr has raised $125 million so far and is now at a reported valuation of $800 million. Investors include Spark Capital, Union Square Ventures, Sequoia Capital, Greylock Partners, Insight Venture Partners and the Chernin Group.

While Tumblr’s Karp has resisted various offers for the company over the years, Mayer spent a lot of time with him reassuring him that Yahoo could turbocharge his business. He has also been searching for a COO to help him build out the infrastructure of its business, especially its advertising one.

And as Peter Kafka and I previously wrote, Tumblr could certainly bring Yahoo a big, young audience. Its worldwide traffic was at 117 million visitors in April, according to comScore. On its home page, Tumblr claims it has 107.8 million blogs and 50.6 billion posts. U.S. desktop traffic to Tumblr was 37 million in April, close to LinkedIn and Twitter, although Twitter obviously has much more via mobile.

But figuring out how to make money from that is a task that the company has only recently started to tackle.

Like other recent Web startups that have seen rocketship growth — see: Twitter, Facebook — Tumblr resisted advertising for its formative years, and its user base seems particularly unwilling to accept standard banner ads. In addition, many industry observers think that Tumblr’s pages are packed with porn or other questionable content that would scare off advertisers.

But within the last year or so, Tumblr has started selling modestly sized “native ads” promoting brands’ Tumblr pages, on users’ “dashboards,” which has shown promise. Tumblr has said it had $13 million in revenue last year and sources said it could get up to $100 million this year.

Tumblr has been represented by Qatalyst Partners’ Frank Quattrone, while Yahoo’s Mayer, as well as M&A head Jackie Reses and CFO Ken Goldman, have been on the company’s side.

Interestingly, what got me first focused on Tumblr last week were Goldman’s comments at JP Morgan’s Global Technology conference last week, where he underscored the need for the aging Yahoo to attract more users from the coveted 18-to-24-years-old age bracket. Along with more marketing, he explicitly said Yahoo needed to be “cool again.”

“One of our challenges is we have had an aging demographic,” said Goldman at the Boston event. “Part of it is going to be just visibility again in making ourselves cool, which we got away from for a couple of years.”

Tumblr, apparently, fits the very expensive bill.

After it pays off a $452.4 million federal loan, Tesla says in a filing today, it will have $678.8 million in cash and cash equivalents, and long term debt of $600 million.

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Because I get bored on Sunday nights, I opened up Yahoo’s recent regulatory filings for some light reading and, as usual, found some tasty information that the company had kindly dropped in for my erudition, but declined to call my attention to.

Namely, that the Silicon Valley Internet giant is paying not so very much for its mobile acquisitions, according to several documents the company has filed.

In fact, Yahoo’s average price paid for each of five of the 10 startups it has purchased since last fall is a tiny $3.2 million in cash.

For example, here’s last week’s 10-Q referring to three of CEO Marissa Mayer’s first acquisitions — content curation app Snip.it, which Yahoo bought in January (funding amount unknown, but the $10 million acquisition price reported by some sites is clearly wrong, as you will see from the filing); recommendation app Alike (funding amount unknown), which was on February’s menu; and recommendation app Jybe (funding amount unknown), which the company picked up in mid-March:

The Company did not make any acquisitions during the three months ended March 31, 2012. However, during the three months ended March 31, 2013, the Company acquired three companies, all of which were accounted for as business combinations. The total purchase price for these acquisitions was $10 million and consisted entirely of cash consideration, primarily allocated to goodwill. Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired and is not deductible for tax purposes.

The Company’s business combinations completed during the three months ended March 31, 2013 did not have a material impact on the Company’s condensed consolidated financial statements.

Going back further, Yahoo’s purchase of recommendation app Stamped last October (it had $3 million in funding) and video-chat app OnTheAir ($880,000 in funding) in December were also on the cheap — a bargain at $6 million total — according to its 10-K filed a few months ago:

During the year ended December 31, 2012, the Company acquired two companies, which were accounted for as business combinations. The total purchase price for these acquisitions was $7 million. The total cash consideration of $7 million less cash acquired of $1 million resulted in a net cash outlay of $6 million. Of the total purchase price, $6 million was allocated to goodwill and $1 million to cash acquired. Goodwill represents the excess of the purchase price over the fair value of the net tangible and intangible assets acquired and is not deductible for tax purposes.

The Company’s business combinations completed in 2012 did not have a material impact on the Company’s consolidated financial statements, and therefore pro forma disclosures have not been presented.

It will be interesting to see what Yahoo reveals as to the price, and how it will account for the late March acquisition of Britain’s news reader Summly, which AllThingsD reported was a loftier $30 million.

The Summly deal did not appear to have closed by the end of the quarter, so no purchase information has been released, although it will be soon enough, along with that of the more recent string of mobile buys by Yahoo: To-do app Astrid, social polling app GoPollGo, travel rewards app MileWise and mobile gaming studio Loki.

For those four tiny companies, which were doubtlessly also bought for very little, Yahoo did tout what it’s really after in a festive tweet on Friday.

Warm entrepreneurial bodies:

We recently added 22 entrepreneurs to our growing mobile team. Welcome to Yahoo! @astrid @gopollgo @milewise @lokistudios!

— Yahoo! Inc.(@YahooInc) May 10, 2013

After a first quarter marked by a 42 percent rise in net profit, Samsung said its cash and cash equivalents grew to nearly $40 billion at the end of March. After stripping out debt, Samsung’s net cash position is 31.2 trillion won, or $28.5 billion. Already one of the biggest in Asia, Samsung’s cash pile is building at an eye-popping rate. Its net cash has nearly tripled over the past year alone.

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There’s no picture of the moment when everything changed for Kevin Systrom. But if there were, it would look something like this: A lanky, very tall, dark-haired man in his late 20s sits on a bench at the Caltrain commuter station in Palo Alto, Calif. A sepia tone and weathered patina might underscore the mood of weighty contemplation.

It was early April of last year, and Systrom was waiting for his business partner, Mike Krieger, to arrive from San Francisco. Systrom had just left Mark Zuckerberg’s nearby house and was still digesting the offer that the Facebook founder and CEO had made him: To buy Instagram, the photo-sharing app that Systrom and Krieger had launched just 18 months before. The price Zuckerberg offered was $1 billion — $300 million in cash and the rest in Facebook stock, an especially generous-seeming deal on the eve of his company’s much-anticipated initial public offering.

The offer was even more impressive given Instagram’s size and age. At the time, it had just 13 employees, operating out of a cramped space in the South Park section of San Francisco. Still, the small crew had managed to attract 30 million Apple iPhone users in just a year and a half by offering a service that allowed a person to quickly upload, prettify through the use of filters and publish images to the Web for friends to see. A version for Google’s Android mobile operating system had launched the week before, attracting another million users in a single day.

What’s more, although the app generated no revenue, it had attracted so much attention from venture capitalists that the startup had nearly closed an impressive new round of funding at a wildly high valuation of $500 million. Zuckerberg had just doubled that, leaving Systrom with a lot to think about on that train-station bench.

Click. If there ever was a money shot to take for Instagram and Systrom, that was it.

(Photo by Jonas Fredwall Karlsson, used with permission by Vanity Fair)

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According to sources, Amazon paid about $150 million for Goodreads, the popular books recommendation service. But that number could close in on $200 million, if certain performance metrics are met.

And, while BusinessWeek ran a we-are-just-guessing story today that posited a self-described “overly simple, back-of-the-envelope estimate” of $1 billion, sources said that number is simply wrong.

I am still trying to determine how much of the deal was cash — most of it, said sources — and how much was stock.

The San Francisco-based Goodreads had raised close to $3 million from a range of angel investors, as well as True Ventures. The sale is a big win for the firm, which apparently owned between 20 percent and 30 percent of Goodreads.

The online retail giant bought the company to help its book-y social discovery efforts for customers.

Amazon declined to comment, but the Seattle-based company said previously that the deal should close in the second quarter. It’s not the first time Amazon has bought a social book site — in 2008, the company acquired Shelfari for under $10 million.

Earlier today, Yahoo said it had acquired the trendy and decidedly stylish news reading app Summly, along with its telegenic and very young entrepreneur Nick D’Aloisio.

Yahoo said it plans to close down the actual app and use the algorithmic summation technology that the 17-year-old D’Aloisio built with a small team of five, along with a major assist from Silicon Valley research institute SRI International, throughout its products.

While Yahoo did not disclose the price, several sources told me that the company paid $30 million — 90 percent in cash and 10 percent in stock — to buy the London-based Apple smartphone app.

And despite its elegant delivery, that’s a very high price, especially since Summly has been downloaded slightly less than one million times since launch — after a quick start amid much publicity over its founder — with about 90 million “summaries” read. Of course, like many such apps, it also had no monetization plan as yet.

What Yahoo is getting, though, is perhaps more valuable — the ability to put the fresh-faced D’Aloisio front and center of its noisy efforts to make consumers see Yahoo as a mobile-first company. That has been the goal of CEO Marissa Mayer, who has bought up a range of small mobile startups since she took over nine months ago and who has talked about the need for Yahoo to focus on the mobile arena above all.

Mayer met with D’Aloisio, said sources, although the deal was struck by voluble M&A head Jackie Reses.

Said one person close to the deal, about the founder: “Nick will be a great person to put in front of the media and consumers with Mayer to make Yahoo seem like it is a place that loves both entrepreneurs and mobile experiences, which in turn will presumably attract others like him.”

Having met the young man in question, who was in San Francisco in the fall on a fundraising trip, I can see the appeal. He’s both well-spoken and adorkable, as well as very adept at charming cranky media types like me by radiating with the kinetic energy of someone born in the mobile world (you can see that in full force in the video below with actor and Summly investor Stephen Fry).

Still, D’Aloisio is very young and presumably has a lot of other entrepreneurial goals and that’s why he agreed as part of the deal to only officially stay 18 months at Yahoo, multiple sources told me. In many cases, startup founders strike such short-term employment deals with big companies, agreeing to stay for a certain determined time period.

He will also remain in England, where he lives with his parents, said sources. In addition, only two of Summly’s employees will go to Yahoo with D’Aloisio.

That’s $10 million each, along with a nifty app Yahoo will not be using as is (too bad, as it would up the hip and fun factor of Yahoo’s apps by a factor of a gazillion if it were maintained).

“It works out on a lot of levels,” said another person close to the situation. “Nick is a founder that will make Mayer and Yahoo look cutting edge.”

Cue the parade of PR profiles of the young genius made millionaire, helping Yahoo become relevant again.

I have an email for comment into the always friendly D’Aloisio. But I don’t expect a reply, since he has apparently been specifically instructed by the martinets of Yahoo PR not to talk to me any longer — well, for 18 months at least! (Don’t worry, Nick, I don’t blame you and will still listen to whatever you are pitching next, since you are so dang compelling and I enjoyed using Summly!)

Until then, here’s the faboo Summly video, with the best chairs ever:

Summly Launch from Summly on Vimeo.

Moody’s Investors Service figures Apple’s cash could balloon beyond $170 billion by year’s end if the company doesn’t start returning some cash to shareholders, whether it be through buyback, increased dividend or even distributing those perpetual preferred iPref shares that Greenlight Capital founder David Einhorn proposed.

“I believe $170 billion in cash by year end 2013 is conservative,” Moody’s Senior Vice President Richard Lane told AllThingsD, “unless Apple decides to do something materially different with respect to capital allocation.”

Lane says Apple generates about 20 percent of its cash flow domestically. If it retains its current dividend and share-buyback program, he figures it would end the year with $40 billion or even $45 billion worth of domestic cash.

As I noted here yesterday, today is the first anniversary of the announcement of Apple’s quarterly dividend, and some expect the company to celebrate by boosting it. That would go a long way toward addressing criticism that Apple’s cash accumulation has become excessive and the company like a Depression-era grandmother in its hoarding of it.

But will Apple do it? Lane’s not certain, though he knows the company is obviously entirely capable of it. “I do not know what Apple may decide,” he said. “But clearly the company has financial capacity to increase returns to shareholders without jeopardizing its financial flexibility to aggressively invest to defend its competitive position.”

Apple’s shares rose nearly 2 percent in early trading Monday following reports that the cash-rich company could boost its dividend by more than 50 percent. Earlier in the day, Bloomberg published a six-analyst survey, the consensus of which was that Apple’s quarterly dividend will rise 56 percent to $4.14 a share. That’s an annual payout of $15.7 billion.

Big bucks, indeed — the largest dividend yield ever, I think. But for a company like Apple, that’s sitting on $137 billion in cash and investments, it’s a realistic prediction. Apple has been under pressure to return some of that money to its shareholders, with some particularly vocal investors criticizing it for the “Depression-era mentality” with which it manages its cash hoard.

That doesn’t mean Apple will do anything with its quarterly dividend tomorrow, though it’s clearly in its best interests to do something to appease shareholders. If it doesn’t announce some sort of plan for its cash soon, there could be ugly repercussions.

“If an announcement does not occur [soon], investors will not only be disappointed in the lack of dividends but start to question whether the management team has the strength to make the smart/obvious moves into lower priced phones or new recurring revenue opportunities like payments and local commerce,” BTIG analyst Walter Piecyk explained. “Is that unfair? Sure. But after several missed quarters, investors patience has shortened with the absence of movement. The dividend decision is becoming an unfair and not entirely relevant proxy on whether the management can act.”

Last week, the fight between Apple and pugnacious hedge fund investor David Einhorn of Greenlight Capital went all flat when he withdrew a lawsuit after the company yanked a proxy proposal that would have allowed shareholders to vote on eliminating preferred stock from the company charter.

But the real issue at the core of the fight — the massive mountain of $137 billion in a cash hoard that Apple holds and that Einhorn wants it to distribute in some fashion to shareholders — still remains.

It’s not clear what Apple will do now, especially since a lot of it is overseas. But execs have indicated that they are evaluating what to do to best serve nervous investors, who have bidded the stock down 40 percent since the fall. While it’s not clear what that will be, it’s also pretty likely Apple will do something.

Until the company decides, though, I have some good ideas for CEO Tim Cook to consider:

* Apple could purchase 1,567,506 Tesla Model S Performance vehicles with 85 kWh battery and a carbon fiber spoiler at $87,400 each, which would effectively allow CEO Elon Musk to buy the New York Times (a bargain at $1.42 billion!) and use it as his own personal blog.

* It could buy 17.9 houses for each Yahoo employee located near its Sunnyvale, Calif., HQ, so they could be super-close to work, per CEO Marissa Mayer’s wishes. That breaks down to 206,015 overall homes for 11,500 workers, at a median sales price of $665,000 for the area.

* Apple could acquire a big chunk of the Internet all at once, including Groupon ($3.36 billion), Yahoo ($25.95 billion), Facebook ($61.7 billion), Twitter ($10 billion), LinkedIn ($18.32 billion), Yelp ($1.47 billion), AOL ($2.81 billion), Pandora ($2.09 billion), Zynga ($2.69 billion), OpenTable ($1.32 billion) and, finally, Pinterest ($2.5 billion). Phew.

* It could pay Andrew Mason’s $378.36 severance after getting jacked as CEO of Groupon 364,013,179 times over.

* Apple could pay for 97,857 parties for Yammer’s David Sacks’s 40th birthday (at $1.4 million each). Snoop Dogg included.

* It could foot the bill for the budget cuts to save the U.S. government $85 billion this year, so Americans could stop having to say “sequester.”

* Apple could buy $329 16 gigabyte Wi-Fi iPad minis for 416,413,374 people — everyone in the U.S. (315,429,318), plus France and Spain.

* Or it could just give the 7,069,909,686 people on the planet $19.38 each, and call it a day.

* Apple could use $1 bills to carpet an area of 560 square miles, which would more than cover Silicon Valley.

* Finally — and I think this would be a nice gesture to make up for calling his efforts a “silly sideshow” — Apple could give Einhorn 15.56 times the value of his $8.8 billion fund.

Or, of course, not.

The virtual currency sounds a lot like the defunct Facebook Credits. Facebook originally launched Credits in 2011, but 18 months later it began moving developers away from the program and allowing them to accept the local currency in each country.

So, can Amazon be successful where Facebook failed?

First, we should look at the theory behind Facebook Credits. It seemed logical: Customers would have the financial relationship with Facebook, rather than trusting some company they’d never heard of with their credit card information. Additionally, they could store their tokens in one central piggy bank and then use them wherever they’d like, rather than buying currency in a game that they may only want to play once.

But that experience didn’t exactly pan out.

Instead, developers required users to convert Facebook Credits to yet another form of virtual currency inside each game, like FarmVille cash. In doing so, developers hoped players would became more committed to the game, at least until the initial batch of coins ran out. The in-game currency also made it hard for players to know how much they were spending (for instance, it’s typically easier to spend 5,000 FarmVille bucks when you don’t know their true value, but it was more difficult to spend 10 Facebook Credits when you knew it cost $1 to get them).

Now, if you look at how Amazon has set up its currency, it’s easy to see how it could face similar problems.

Each Amazon coin will be worth one cent, so a game that costs $2.99 will cost 299 coins. Likewise, a $5 in-app purchase would cost 500 coins. It may be easy math for the players to do, but Amazon confirmed that it will also allow developers to use their own in-game currencies, just like Facebook.

That means that developers will be able to hide the real cost of virtual goods inside a game with more complicated exchange rates, if they wish.

Amazon also confirmed that developers will continue to earn their standard 70 percent revenue share with Amazon Coins.

In those ways, the programs are identical. The major difference between Amazon and Facebook, however, is that Amazon already has credit cards on file for each customer, whereas none of Facebook’s users had provided payment information when they registered.

So, in that respect, Amazon’s motivation for rolling out a virtual currency should be different.

One benefit for introducing Coins will be that parents will be able to easily dictate spending limits inside games for their children. After all, the coins will be valid only inside the Appstore. Customers will not be able to use them anywhere else, like for purchasing an e-book or a movie.

The different silos for the different payment information may be exactly what Amazon is looking for, but for Facebook it ultimately became a problem. As Facebook started to expand its product offerings beyond virtual goods to real products, like Gifts, no vendor was going to be willing to accept the 70 percent revenue share first rolled out to game developers. At the same time, having a complicated two-tier or multi-tier revenue share process, depending on the item sold, may have been complicated.

True currency ended up being an easier way to conduct transactions for all parties.

In that way, Amazon’s goals for its currency may be way less ambitious. Instead of creating a currency that will span all types of products and services, it may end up being a simple way for parents to regulate spending inside games, and an easier way for adults to monitor their own spending. (For instance, at the beginning of the month, you could decide to purchase $25 worth of coins, and once they are gone, you wouldn’t allow yourself to buy anymore.)

Amazon Coins will launch in the U.S. this May. To help spur adoption of the program, Amazon pledges to give customers “tens of millions of dollars’ worth of free Amazon Coins” to spend on developers’ apps on Kindle Fire in the Amazon Appstore.

“Now we have another new way to help developers reach even more of our millions of customers,” said Paul Ryder, Amazon’s VP of Apps and Games, in a statement. “Amazon Coins gives customers an easy way to spend money on developers’ apps on Kindle Fire in the Amazon Appstore.”

Earlier today Yahoo reported fourth-quarter earnings that beat analyst estimates, on still-flattish revenue.

Still, up is up, even if it is not really that much up, so Wall Steet bid up shares of the Silicon Valley Internet giant in after-hours trading.

Now it’s onto the conference call with investors for CEO Marissa Mayer:

2:02 pm: Before the call, you can hear Mayer complaining about the goofy music played during the pre-conference call waiting time.

“We have to get better music,” she says to some minion. “This is not good music.”

Music to my ears! I say we get Beyoncé, lipsyncing or not.

The call starts quickly after that, with the ever-eager Mayer leaping right in with the fourth-quarter news, which is not all that bad.

It’s the first full year of growth in a while — though not the first quarter-to-quarter increase — even if it is only a very modest two percent increase.

That compares to industry-wide gains in revenue of many, many, many times that, but for Yahoo this is cause for a parade. A small parade, with good music, but a parade nonetheless.

“It’s hard to believe this is only my first full quarter here at Yahoo,” says Mayer in an upbeat tone.

She notes that her focus on product excellence and user experience was continuing, with some “early positive trends” in both products and people.

Mayer then list a series of moves, from the free food and better smartphones for employees to the addition of well-regarded entrepreneur Max Levchin to the board to the refreshes of Yahoo Mail and Flickr to the acquisition of some sassy new mobile startups.

Mayer also notes that the company under her purview had removed “385 of highest priority obstacles,” although she did not name any specifics.

I imagine what No. 332 is: Switching out the iceberg lettuce at the URL cafeteria on Yahoo’s Sunnyvale, Calif. HQ campus with some tasty organic mesclun as they have at Google, from whence Mayer came.

Better roughage means better returns!

2:14 pm: Mayer turns the call over to CFO Ken Goldman, also a newbie. As usual, he runs through the numbers that are already in all the releases already. But I am enjoying his New England accent, hoping he will say the slight increase in revenue was “wicked” good.

Goldman, in fact, calls the revenue increase “modest,” which is true, although it sounds like “mah-dist.”

What’s not mah-dist is how much stock Yahoo has bought back, using its windfall from the recent sale of assets in China. It’s $1.45 billion, with more that that left to use for more share buybacks. That should keep Yahoo’s stock up nicely.

Goldman also talks about increases in the company’s search business, although notes that the Microsoft relationship is still not the most fantastic.

He speaks more effusively of Yahoo’s Asian partners, including Yahoo! Japan and China’s Alibaba Group. It’s deserved, since they have been the company’s treasure trove against its meh core performance in recent years.

Not so tasty is the problem Yahoo has with a big-money contract dispute in Mexico, which Goldman reiterates is “without merit.”

2:28 pm: Goldman moves onto Yahoo’s cash position, which is strong and which he says is going to be used to make the company better.

Mayer is back on board, talking about key focuses over multiple years.

She says Yahoo needs a “chain reaction of growth,” which needs to be fueled by a dozen new products that become a daily habits for consumers to increase usage and other metrics.

A nuclear bomb explosion is not exactly the best metaphor for a company’s turnaround, but in Yahoo’s case it is probably a pretty good one, given how stubborn its decline has been.

Mayer then switches the metaphor to one she recently used about “returning to the roots” of Yahoo.

Actually, mixing the metaphors, Yahoo has to blast some significant roots that have gotten in the way of its innovation over the years.

“The best is yet to come,” promises Mayer, in what she says will be a multi-year effort.

Now onto questions from the analysts!

2:40 pm: The first question is about commercialization of its products. Mayer answers she is both pro-advertising and anti-ad — meaning they are good when they add to user experience and bad when they do not.

There will be slight margin declines due to this, which is the real point of the query, which Goldman says will not be too impacted.

The next question is on the weaker performance in display ads and whether mobile ads can ramp up quick enough or not.

Yahoo is not breaking out mobile revenue numbers as yet — it’s not impressive as yet, so that’s what’s going on there — although Mayer points to the number of mobile users increasing to 200 million now.

As to the declines in display, Mayer gives a non-answer, but it is likely due to big changes that new Yahoo COO Henrique De Castro has put into place in the way it sells ads and which AllThingsD.com previously reported on. Mayer earlier in the call had confirmed those changes.

The fact of the matter — which is just what the analyst was asking about — is that Mayer simply has to improve display revenue, which is Yahoo’s core business.

Mayer then addresses the issue of not providing usage metrics anymore. Yahoo has withheld a lot of them since she has taken over, and she says it is because they are not indicative of metrics that, well, she thinks you need to know.

Instead, Mayer points to other metrics that she feels are better, such as number of ads sold and price per click on search.

Speaking of search, the next question is about that. What can Mayer say — and she does — but that Yahoo must also improve in that area. Indeed, it is lucrative low-hanging fruit for the company.

Here comes an interesting observation she makes based on a question of mobile versus desktop, which Mayer says should not be separated as two areas as consumers don’t think that way.

Yahoo is tuning up a dozen products, she says, having started with Yahoo Mail and its Flickr photo-sharing app.

2:54 pm: Mayer is not saying which of this dirty dozen is next to get a makeover.

“We’re investing in small, nimble, excellent teams,” says Mayer, who then tries to reference a famous Margaret Mead quote, but ends up mangling it a bit.

It is, for the record: “Never doubt that a small group of thoughtful, committed, citizens can change the world. Indeed, it is the only thing that ever has.”

This is true, which might make some Yahoo staffers nervous, since Mayer’s recent stack ranking of them means she can start on employee layoffs anytime she likes to separate the wheat from the chaff.

3:01 pm: Whoo-whee, this is going long and I am getting weary. Mayer has to be some kind of digital Energizer Bunny — she just flew in from the World Economic Forum in Davos, Switzerland and moved right into the prep for the Q4 earnings.

Tomorrow, she is presumably off to Las Vegas, where Yahoo’s global sales conference will start and she will doubtlessly be making an appearance.

I am exhausted simply by walking up and down the stairs at my house.

The next question is about third-party publishers and ad tech on mobile.

“Mobile monetization is new for everyone,” she says correctly, making the point that no one knows what is going to shake out.

She uses — as she has used — the example of when people thought search was not a moneymaker until Google proved otherwise.

The problem is, of course, that Google is Yahoo’s biggest rival in this new mobile ad arena, along with Facebook and many others. And Google, as its recent results showed, does know how to make money compared to Yahoo.

The next question is about mobile monetization eating into desktop revenue.

Mayer notes that Yahoo has hired 120 people with computer science degrees in the quarter to work on that area.

In other words, get ready for a symphony of geeks to return Yahoo to relevance.

Would they can pull it off, as that would be a tune worth listening to.

Speaking of something worth listening to, here is a video of Diana Ross’ song, “Chain Reaction,” to enjoy:

Even though it seems like a dog’s age, it has been only two years since AOL bought the Huffington Post at the Super Bowl XLV in Dallas (yes, papers were actually signed there).

Back then — after AOL ponied up $315 million, mostly in cash, to buy one of the Web’s most prominent news and opinion sites, along with one of the most famous women on the Web as its leader — the pair called it: “One plus one equals 11.”

Looking back today, it’s more like one plus one equals fireworks — given all the dramatic narrative that has ensued since the deal was struck. While it started off with a series of splashy joint appearances — hey, world, it’s the Tim and Arianna show! — some bumps in the road later resulted in a fair amount of tension between Armstrong and Huffington, which the two now say has passed.

That has included a big, ugly (but still riveting) fight among and between Armstrong, Huffington and Michael Arrington of TechCrunch, another AOL property. Without reliving the messy timeline and ethical traffic accident, Arrington left after a lot of Sturm und Drang, verbally trashing Huffington on his way out the door, even though he later returned to the fold as a columnist.

(Bygones? Whatever!)

More importantly, while her role was conceived much more broadly and horizontally at the time of the acquisition, as a kind of overall content ruler at AOL, that clearly did not work out as envisioned and — perhaps as it should have been from the start — it has since been made very vertical.

That has essentially meant Huffington gets to rule over her fast-expanding empire of global sites under her name, with Armstrong footing the investment and tending to fixing the other parts of the company.

Thus, for now at least, all’s well that ends well. AOL’s stock has soared this year, after a series of shrewd financial and organizational moves by Armstrong, and Huffington is ever busy opening yet another international Web outpost.

I checked in with both on how they are doing, in separate video interviews that I did last week in New York, where AOL is located. And to remember how this Web marriage started, I’ve also included the the one I did two years ago in Dallas at the dawn of the relationship.

Enjoy:

]]> http://allthingsd.com/20130117/two-years-after-dramatic-huffpost-buy-aols-armstrong-and-arianna-talk-about-the-sometimes-rocky-road-video/feed/ 0 http://allthingsd.com/20121124/vcs-still-chasing-web-companies-but-with-less-cash/ http://allthingsd.com/20121124/vcs-still-chasing-web-companies-but-with-less-cash/#comments Sun, 25 Nov 2012 00:00:24 +0000 Russ Garland http://allthingsd.com/?p=272334 Venture investors still have a healthy appetite for early-stage consumer Internet companies, but those startups are having a harder time raising follow-on financing.

Overall the amount invested in consumer information services was off 42% in the first nine months as the difficulties of newly public Internet companies such as Facebook and Zynga cast doubt on the business models and valuations of social media companies.

Read the rest of this post on the original site

]]> http://allthingsd.com/20121124/vcs-still-chasing-web-companies-but-with-less-cash/feed/ 0 http://allthingsd.com/20121114/why-cisco-ceo-john-chambers-loves-canada/ http://allthingsd.com/20121114/why-cisco-ceo-john-chambers-loves-canada/#comments Wed, 14 Nov 2012 16:42:09 +0000 Arik Hesseldahl http://allthingsd.com/?p=269383 Cisco Systems CEO John Chambers apparently likes the way they do things up north. On a day when his company reported earnings that slightly beat the expectations of analysts and sent Cisco shares up by more than 7 percent in after-hours trading, Chambers said Cisco may take a good portion — about 82 percent — of its $45-billion-and-growing pile of cash to Canada.

Canada? Right. Canada. Recall that Chambers has long been a vocal critic of a U.S. policy that taxes corporate profits at 35 percent. Because of this policy, and because companies have a fiduciary responsibility to their shareholders to use their cash in the least-costly manner possible, companies like Cisco, Apple, Microsoft, and others have tended to leave what cash they generate invested outside the U.S. until such time as they can repatriate it at a lower tax rate.

Chambers took this argument to mainstream American TV viewers in an interview with CBS News correspondent Lesley Stahl on “60 Minutes” last year. Chambers told Stahl that without a lower rate, Cisco would be forced to invest more resources overseas, acquire more non-U.S. companies, and so on.

And he’s done what he said. For just one example, look at NDS, the Israeli video technology company for which it paid $5 billion earlier this year.

Yesterday, Chambers made a point of singing the praises of Canada, where he says Cisco will be taking more of its $45 billion in cash for the purpose of making investments in the coming year. First he said it to Maria Bartiromo on CNBC (see video below), and then on Cisco’s earnings conference call with analysts. And then he said it to me.

Here he is saying it to Bartiromo, but with a new twist: Cisco may take some of its bankroll to Canada, which he called “the easiest place in the world to do business. … We need to learn from them.”

Later on, Chambers repeated similar sentiment on Cisco’s conference call. Answering a question from Goldman Sachs analyst Simona Jankowski about the business environment in the face of the fiscal cliff circus that has everyone in Washington all riled up, Chambers quickly pivoted to U.S. tax policy.

I personally think the fiscal cliff, we’re going to work through that probably with little bit of saber-rattling on both sides. We’re looking more towards the tax policy and if the government is able to instill the confidence in business that allows and ready to invest.

If I would look at one model, we have to look at very carefully around the world it’s Canada, the easiest place to do business. It doesn’t matter which party is in power, even their provinces, their states. When the national government, Prime Minister Harper gets it the leaders in Ottawa will get it, they drive down through and make it very easy do business there. And you’re going to see us grow our business there as well as invest overall.

I asked Chambers about his sudden love of all things Canadian in a brief interview last night. “They have a great education system, and a predictable tax system,” he said.

It’s true: Canada has lowered its federal corporate tax rate to 15 percent, soundly beating the 35 percent rate in the U.S., which is now the world’s highest. Even President Obama is on board with the idea that that rate should be cut. But Chambers has $45 billion burning a hole in his pocket. And from all indications, business is looking up after a few tough years.

So here’s the second of my quarterly song selections, the additional song I promised yesterday: “Blame Canada,” from the “South Park” movie. Naturally.

]]> http://allthingsd.com/20121114/why-cisco-ceo-john-chambers-loves-canada/feed/ 0 http://allthingsd.com/20121025/amid-market-difficulties-and-layoffs-chipmaker-amd-faces-a-cash-crunch/ http://allthingsd.com/20121025/amid-market-difficulties-and-layoffs-chipmaker-amd-faces-a-cash-crunch/#comments Thu, 25 Oct 2012 15:08:04 +0000 Arik Hesseldahl http://allthingsd.com/?p=263634 There’s no question that times have been tough of late for the chipmaker Advanced Micro Devices. Last week, the company confirmed that it will fire about 15 percent of its employees, making for the second significant reduction in force since CEO Rory Read took the helm in August of 2011.

As the market for PC microprocessors — in which AMD has for decades been a far-distant No. 2 to the market’s global leader, Intel — has dwindled amid softening demand for PCs and servers, AMD has sputtered badly. Read is said to be assembling a new corporate strategy that would involve pivoting toward chips aimed at tablets and smartphones, and an update on that strategy is expected next week.

But in the meantime there is a new fundamental concern about AMD’s ability to survive long enough as a going concern to embark on that strategy: AMD is running low on cash.

The concern comes from Stacy Rasgon, an analyst at Sanford Bernstein in New York, who encapsulated his worries in a research note issued to clients today. Once bullish on AMD given its relatively low price and the prospect that AMD stood a fair chance of generating cash at a healthy clip, Rasgon has now changed his mind. “The combination of a weak PC market and poor execution is significantly pressuring the top line, while the company appears to be suggesting long term gross margins will be significantly lower than in the past,” Rasgon wrote.

AMD has $1.3 billion in combined cash and marketable securities as of the quarter ended Sept. 29, down from $1.6 billion at the end of the quarter ended in June. As its profit margins and free cash flow contract, AMD will consume cash at such a rate that it will be down to $600 million by the end of 2013.

On top of that, AMD’s debt load will become a more urgent concern. The company finished its September quarter with more than $2 billion in long-term debt, up from $1.53 billion in the June quarter. And the cost to protect against a default on that debt via credit default swaps has started to spike. As Bloomberg News noted today, debt investors think AMD has a 62.5 percent chance of defaulting on its debt within five years, up from 51 percent on Oct. 17, the day before it reported earnings.

It now costs more to insure against a default on debt from AMD than it does to insure debt from Finland’s troubled wireless phone concern Nokia, or from Freescale Semiconductor, also facing cash troubles. “Apparently the debt markets believe AMD is more at risk from liquidity issues than even Freescale. We think this is likely correct,” Rasgon wrote.

Without a turnaround in the market for personal computers — something that’s essentially impossible to predict right now — or a significant improvement in AMD’s ability to generate a healthy profit on its chips, the cash burn will continue.

If it gets as bad as Rasgon says it might, that’s going to raise some uncomfortable questions about AMD’s long-term viability and reignite the recurring takeover chatter that hits the company from time to time. The problem is, as we’ve pointed out a few times before, AMD will be a complicated company for any potential suitor to buy, mainly because of its unusual relationship with rival Intel.

It’s not the first time that the conventional wisdom has counted AMD down for the count. In the late 1990s, it was bloodied and beaten and seemed all but defeated. Then in 1999 it announced a novel approach to server chips that within a few years proved so successful in the marketplace that AMD gave mighty Intel some sharp competitive headaches.

A new strategy is coming. AMD is supposedly close to announcing something called an “ambidextrous” strategy that will in some way include using chip cores licensed from ARM, the British holding company whose technology lies at the heart of most of the chips powering the world’s smartphones and tablets, including the iPad, the iPhone and numerous devices running Android and Windows.

This would be a fundamental shift in AMD’s approach. Its prior CEO, Dirk Meyer, and his predecessor, Hector Ruiz, had been advocates of the so-called “x86 everywhere” philosophy. The phrase “x86″ refers to the basic instruction set used by chips from PC microprocessors from Intel and AMD. They are a key part of what makes a PC a PC, and give software developers the world over a common set of assumptions they can make when writing software.

ARM chips, on the other hand, are based around a fundamentally different set of instructions that, among other things, make them especially good at consuming very little power, a must in mobile devices. A variant of Windows known as Windows RT has only recently been created to run on a new generation of notebooks.

Many people expect AMD to supplement its current designs with an ARM-based design, and its recent hiring of a crack ARM designer — Apple’s former head chip designer Jim Keller — certainly raised a lot of industry eyebrows.

Whatever AMD does, it better do it fast.

]]> http://allthingsd.com/20121025/amid-market-difficulties-and-layoffs-chipmaker-amd-faces-a-cash-crunch/feed/ 0 http://allthingsd.com/20121022/hall-pass-yahoo-meets-lackluster-expectations-in-third-quarter-with-investor-focus-on-mayers-plans/ http://allthingsd.com/20121022/hall-pass-yahoo-meets-lackluster-expectations-in-third-quarter-with-investor-focus-on-mayers-plans/#comments Mon, 22 Oct 2012 20:26:41 +0000 Kara Swisher http://allthingsd.com/?p=262385

Yahoo is nothing if not consistent, turning in yet another weak quarter that met weak expectations from investors.

The 98-pound weakling is still weak!

In the third quarter, the Silicon Valley Internet giant had $1.089 billion in revenue, a hair above expectations and just two percent higher than a year ago. (Please note that competitors, such as Google and even Facebook, are growing revenue like gangbusters.)

Profits were also weak, despite an apparent pop from a gain from its sale of some of the shares it holds in China’s Alibaba Group. But let’s focus on operations, people, which are the real numbers to gauge. As Yahoo noted: “On a GAAP basis, income from operations decreased 14 percent to $152 million in the third quarter of 2012, compared to $177 million in the third quarter of 2011.”

Minus traffic acquisition costs, display revenue was down to $451.6 million, compared to consensus estimates of $484 million; search revenue was up only a tiny bit to $414.1 million (consensus was $411 million).

Interestingly, Yahoo left out detailed information it has usually provides about engagement and other user metrics. Let me take a big guess: The numbers are simply not impressive, or else they would have been touted.

Also left out was any guidance going forward — new CFO Ken Goldman just came on today, so that’s no surprise. Guess it’s time to throw out the trash, as they say in politics!

But here’s an interesting factoid in the press release: “In October 2012, Yahoo! entered into a 364-day, $750 million unsecured revolving credit facility. The facility is currently undrawn and is expected to be used for general corporate purposes.”

More available cash to go with the pile of cash that Yahoo has already piled up for purposes unclear right now.

To be clear, this meh quarter does not matter at all — with Yahoo getting a financial equivalent of a hall pass for these results — as investors look to hear from new CEO Marissa Mayer about her plans to make all the bad go away. Until she charts a course and sets out on it, it is likely that no one is going to blame her for Yahoo’s past woes.

As Mayer said in a statement today: “Yahoo! had a solid third quarter, and we are encouraged by the stabilization in search and display revenue. We’re taking important steps to position Yahoo! for long-term success, and we’re confident that our focus on quality and improving the user experience will drive increased value for our advertisers, partners and shareholders.”

Everyone is looking forward to hearing how, which the former Google exec will presumably explain in more detail on a conference call with Wall Street analysts — her first as a public company CEO — at 2 pm PT. Tune in for my live blog.

Until then, here are Yahoo’s Q3 slides to peruse:

YHOO_Q312EarningsPresentation_FINAL

]]> http://allthingsd.com/20121022/hall-pass-yahoo-meets-lackluster-expectations-in-third-quarter-with-investor-focus-on-mayers-plans/feed/ 0 http://allthingsd.com/20121022/with-low-expectations-for-3q-wall-street-hoping-for-new-yahoo-ceo-mayer-to-shine-a-light-at-end-of-tunnel/ http://allthingsd.com/20121022/with-low-expectations-for-3q-wall-street-hoping-for-new-yahoo-ceo-mayer-to-shine-a-light-at-end-of-tunnel/#comments Mon, 22 Oct 2012 15:49:25 +0000 Kara Swisher http://allthingsd.com/?p=262227

Later today, new Yahoo CEO and latest savior Marissa Mayer is expected to debut in her first major turn as a public company CEO, as the company reports its third-quarter earnings.

Unfortunately, her initial script recounting the last three months is likely to be rather lackluster, with Wall Street anticipating yet another nothing-to-write-home-about financial performance from the Silicon Valley Internet giant.

Investors are expecting $1.08 billion in revenue and 25 cents in net income per share in a report that is likely to show more of the same kind of weakness Yahoo has had for far too long. The main reasons this time: Worrisome growth in search and display advertising, especially compared to robust worldwide trends.

Such concerns have kept Yahoo’s stock pretty much flatlined at about $16 a share since she arrived in July.

And that is not likely to change until Wall Street hears more specifics about Mayer’s future plans. Yahoo has previously said she would outline more about her direction on the call with investors later today, after the financial results are released.

Thus, it’s basically a wait-and-see attitude, until Mayer does that, and perhaps until after there is some actual traction.

As noted by Cantor Fitzgerald’s Youssef Squali:

“1) We’ve seen this movie before (this new CEO is the fifth in as many years) and 2) it will take some time before any of the yet-to-be-announced changes yield any meaningful P&L results. Until then, we see Yahoo! shares remain cheap with limited downside, but no clear catalyst to drive them higher short/medium-term.”

Among the highlights that investors hope will be covered by Mayer and also by new CFO Ken Goldman:

A cogent strategy to turbocharge the business, which — as ATD has reported many times — will focus on tech and product solutions; what acquisition arenas are in the pipeline; plans for new talent recruitment and perhaps layoffs of less-than-stellar employees at the bottom 20 percent of Yahoo; the status of talks to sell off its stake in Yahoo Japan; and, perhaps most of all, what are the plans to return cash to shareholders from its recent sale of its partial stake in China’s Alibaba Group.

That might already be in the works via stock buybacks that Yahoo has been engaged in, but it will be interesting to see if Mayer will provide more specifics.

Investors will also look for some details around mobile growth, and perhaps an update of how Yahoo is fixing its search monetization problems with its partner, Microsoft.

One development that some expect is that Mayer will drop future expectations, in a classic take-out-the-trash move.

As J.P. Morgan’s Doug Anmuth noted:

“Similar to what AOL CEO Tim Armstrong did when he stepped in a few years ago, we believe Mayer is likely to remove low quality ad units and over-monetization throughout the site. Despite the near-term monetization impact, we think this would be a good thing, as it would improve the user experience and de-clutter the site. Additionally, we think it’s likely new management would simply want to start off with a low bar.”

And, if she makes it low enough, anything Mayer will do going forward is likely to look pretty good.

]]> http://allthingsd.com/20121022/with-low-expectations-for-3q-wall-street-hoping-for-new-yahoo-ceo-mayer-to-shine-a-light-at-end-of-tunnel/feed/ 0 http://allthingsd.com/20121020/10-q-watch-ebay-receives-145-million-check-for-rent-com/ http://allthingsd.com/20121020/10-q-watch-ebay-receives-145-million-check-for-rent-com/#comments Sat, 20 Oct 2012 23:30:27 +0000 Tricia Duryee http://allthingsd.com/?p=261994 EBay has disclosed how much it made from the sale of its Rent.com subsidiary after closing the deal months ago.

According to a document filed with the Securities & Exchange Commission on Friday, proceeds from the sale of Rent.com totaled $145 million, which resulted in the online retailer recording a gain of $118 million.

Atlanta-based Primedia purchased the apartment listing service back in March.

EBay had previously said that Rent.com was instrumental in helping build its eBay Motors division, but now the division is better off with Primedia’s other properties, including ApartmentGuide.com, Rentals.com and RentalHouses.com. EBay originally acquired Rent.com seven years ago for $435 million in cash.

Coincidentally, eBay spent about the same amount of money that it made on the Rent.com sale on three acquisitions during the quarter. The company did not name the parties involved, but said two were for their marketplaces business, while a third was for PayPal. The total spent was $149 million, primarily in cash.

One of those acquisitions is likely Svpply, a social commerce site it disclosed buying earlier this month as part of its new homepage unveiling. In general, these acquisitions are drops in the bucket. Over the past two years, the company has spent billions on acquiring other companies, including roughly $3 billion on GSI, and several other smaller acquisitions, including Red Laser, Milo and Zong.

The purchases have helped transform the company from strictly a payments- and marketplaces-driven business to one that offers services to other retailers, like Toys “R” Us. In July, the company raised $3 billion in debt, but said it wasn’t expecting any “meaningful mergers and acquisitions activity in the near term.”

]]> http://allthingsd.com/20121020/10-q-watch-ebay-receives-145-million-check-for-rent-com/feed/ 0 http://allthingsd.com/20121015/yahoo-confirms-hiring-of-googles-de-castro-as-coo-like-i-said/ http://allthingsd.com/20121015/yahoo-confirms-hiring-of-googles-de-castro-as-coo-like-i-said/#comments Mon, 15 Oct 2012 21:34:35 +0000 Kara Swisher http://allthingsd.com/?p=260297

Yahoo said today in a regulatory filing that it had hired one of Google’s top sales execs, Henrique De Castro, as its COO.

Earlier today, I had reported that CEO Marissa Mayer had been close to nabbing the advertising exec, who has most recently been Google’s president of partners business solutions.

De Castro is getting a pile of money for taking the job, including a $600,000 yearly base salary and an annual bonus that could double that figure. In addition, the Silicon Valley Internet giant will give him $36 million in stock grants, including a one-time retention equity award of $18 million and $18 million in the form of performance-based stock options.

He is also getting $1 million in “make-whole” cash for forgoing compensation from Google and $20 million in stock to replace his shares at the search giant that will vest over four years.

That is a very big check, although Mayer garnered an even bigger one when she joined the company in July.

Yahoo’s regulatory statement on the De Castro hiring is embedded below in its entirety, so you can read about his new riches for yourself (unless Yahoo’s persnickety legal head tries to block it).

Said a Google spokesperson about the departure: “We’re grateful to Henrique for all of his contributions at Google and wish him all the best in his new role at Yahoo!”

Both Mayer and also former Yahoo CEO Scott Thompson have made previous overtures to nab De Castro, who has held a number of high-level jobs for Google across the globe, including at DoubleClick, in display ads and with major partners.

While he had previously rebuffed those efforts, this time De Castro bit.

There were signs he might this past week, after De Castro canceled a major offsite for his employees, and several attendees who know him well said he was not present at the company’s first night of its annual Zeitgeist event for advertising and publishing clients. The suave De Castro is usually a more noticeable fixture at such gatherings.

This is Mayer’s first big hire at Yahoo, having added only lower-level or less well-known execs to her stable of talent since she was appointed.

She touted the hire in a tweet, although the news was long out the door, while also noting on Twitter it was her first full day at the office since having her first baby two weeks ago.

My first full day back in the office, and I’m excited to kick it off by announcing my new COO, Henrique de Castro: businesswire.com/news/home/2012…

— marissamayer (@marissamayer) October 15, 2012

The hiring does create a potential issue in the sales arena, especially with current head of revenue Michael Barrett. De Castro and Barrett worked together at Google and multiple sources said the pair did not get along there.

It might not matter. While Barrett has publicly said he planned to stay at Yahoo under Mayer — he was hired by interim CEO Ross Levinson this summer before she arrived — many sources said he does not want to be at the company for the long term.

De Castro has a lot of work to do for the big payout he is getting and it will be a big challenge for him to turn around the troubled organization.

Along with declining growth, search market share, engagement and more, Yahoo also has had a management turnover issue of epic proportions.

De Castro will presumably be in charge of making it all better at Yahoo when he arrives sometime before the beginning of the year and is likely to focus on operations while Mayer zeroes in on products.

One area of trouble: While she has lavished attention on cultural issues and on the company’s tech troops, sources said most of the advertising and media leadership at Yahoo have had little interaction with Mayer since she arrived this summer.

Advertising, of course, is Yahoo’s biggest money maker.

The Portugal-born De Castro has a lot of experience here and is decidedly more of a charmer than Mayer.

More importantly, he is a very high-profile hire, as well as a colorful one. He speaks a menu of languages, dresses with a lot of style and is a worldwide traveler. I know him a little bit and find him to be smooth and confident, even if a little cagey.

Before Google, De Castro worked at Dell and also McKinsey.

All this makes him a perfect choice for Mayer, who is also a former Googler, since she has been considering purchasing a range of companies in the advertising tech space. The most likely candidate of late is PubMatic, which has been in early talks with Yahoo about being acquired.

The Silicon Valley start-up would be a solid add to Yahoo’s ad platform offerings, especially if it wants to stay competitive with Google. PubMatic helps publishers effectively manage their display ad inventory, and competes with Google’s AdMeld.

(Ironically, Barrett ran that start-up, which he sold to Google for $400 million about a year ago.)

Here is the De Castro hiring document from Yahoo:

YHOO-20121015-8K-20121015

And here is the official press release from Yahoo:

Henrique de Castro Named Chief Operating Officer of Yahoo!

October 15, 2012

SUNNYVALE, Calif. – Yahoo! Inc. (NASDAQ: YHOO) announced today that Henrique de Castro has been hired as chief operating officer (COO). Reporting directly to Yahoo! CEO Marissa Mayer, de Castro will be responsible for strategic and operational management of Yahoo!’s sales, operations, media and business development worldwide.

“Henrique is an incredibly accomplished and rigorous business leader, and I’m personally excited to have him join Yahoo!’s strong leadership team,” said Marissa Mayer, CEO of Yahoo!. “His operational experience in Internet advertising and his proven success in structuring and scaling global organizations make him the perfect fit for Yahoo! as we propel the business to its next phase of growth.”

“The combination of Yahoo!’s unique properties with high quality content, its renewed focus on outstanding user experience and its massive reach bring tremendous value to users, advertisers and partners,” said de Castro. “This is a pivotal point in Yahoo!’s history, and I believe strongly in the opportunity ahead. I can’t wait to join Marissa and the team and get started.”

De Castro brings more than 20 years experience leading operations, strategy, partner management and revenue generation for some of the world’s leading brands. Most recently, he was vice president of Google’s worldwide Partner Business Solutions group, where he was responsible for advertising platforms and services for Google’s publisher and commerce partners. Prior to that, he led Google’s media, mobile and platforms organization, where he helped to grow the business significantly. Prior to Google, de Castro spent two years at Dell Corporation, where he managed sales and business development operations across Western Europe. He has consulted for McKinsey & Company, where he advised numerous clients across many different industries. His career also includes senior positions in private equity and advertising businesses.

De Castro will join the company on or before January 22, 2013, or as soon as he has satisfied his obligations to his current employer.

]]> http://allthingsd.com/20121015/yahoo-confirms-hiring-of-googles-de-castro-as-coo-like-i-said/feed/ 0 http://allthingsd.com/20121008/here-come-the-inevitable-marissa-mayer-magazine-profiles-as-she-preps-her-quick-return-to-yahoo/ http://allthingsd.com/20121008/here-come-the-inevitable-marissa-mayer-magazine-profiles-as-she-preps-her-quick-return-to-yahoo/#comments Mon, 08 Oct 2012 15:17:07 +0000 Kara Swisher http://allthingsd.com/?p=257839

New York magazine just published what will doubtlessly be the first of many larger-scale profile pieces on new Yahoo CEO Marissa Mayer (Fortune’s at work on one, too).

Titled “Can Marissa Mayer Really Have It All?” New York’s version is a very solid and fair effort that raises a lot of pertinent questions about the Silicon Valley Internet giant’s latest leader.

That, of course, includes pondering the high-profile issues around her coping with a newborn (really new) and work; her carefully crafted public glamour-geek-girl persona that is at odds with her sometimes more tetchy private one; Mayer’s mostly-up-and-then-down-at-the-end career at Google as a key exec; and the myriad challenges she faces in turning around the long-troubled Yahoo.

Writes Lisa Miller quite astutely: “This newest version of Marissa, the mom-geek-CEO, will surely test Mayer’s iterative powers, for she’s playing to a tougher crowd, one that won’t be placated by tweets, Manolos, and rapturous praise for pineapple malts.”

Indeed not, which is why sources said Mayer is likely to begin to make postpartum appearances back at Yahoo as early as this week. She delivered her first child with husband Zach Bogue, whom she dubbed “Big Baby Boy Bogue,” on Sept. 30.

Among the initiatives she has been working on up to and after her son’s birth, said numerous sources, is the redo of Yahoo’s powerful home page, a reorganization of top management duties, and an announcement about whether it will buy back shares or give a dividend from its recent multibillion-dollar sale of part of its lucrative stake in China’s Alibaba Group.

In addition, said sources, Mayer is also putting into place her new methodology of keeping track of employee performance and rewards. There is an all-hands meeting scheduled today, in fact, apparently to go over the system, which Mayer spoke about in her last all-hands meeting.

The home page redo is also in the late-stage works for unveiling soon, said sources. Those who have seen it said it has a starker and simpler design ethos, and will stress user personalization, customization and more social elements. It will also have ample opportunity for third-party developers to offer a variety of services on it (maybe Mayer can save Zynga by copying a little bit from Facebook!).

The reorg will also be interesting. Mayer has made a number of top exec appointments, including adding a new CFO and head of HR. She will also be rejiggering other roles of existing management.

For example, expect tech and operations EVP David Dibble — who got a mess of new responsibilities right before Mayer was appointed — to have some of that dialed back.

The disposition of all $3.6 billion of Alibaba cash is perhaps the most immediate issue, especially for investors, who are largely hoping for a buyback of stock. Such a move will likely cause Yahoo shares to rise, as happened at AOL.

That would be nice, since Yahoo stock has stayed pretty flat since Mayer got to the company in July. (That compares, ironically, to a 31 percent rise at Google since she left.)

But Wall Street analysts and others have been making bullish calls on Yahoo recently, including CNBC’s screamy stock guru Jim Cramer of “Mad Money.”

Boosted by the growing value of its Asian assets — in China, as well as in Japan, which Yahoo is trying to sell — and also anticipating some kind of magic mojo from Mayer, price targets for Yahoo shares have been as high as $22.

That was from Goldman Sachs, which reinstated coverage of Yahoo with a “buy” rating recently. Analyst Heath Terry noted that “while user engagement continues to decline, the company lacks a mobile strategy and significant talent has left the company, Yahoo still has hundreds of millions of users, valuable Web properties, and the financial resources to fuel a potential turn around over time.”

Translated: Yahoo kinda stinks, but it still might be able to buy itself out of this mess with a $10.6 billion pile of dough from Asia.

All eyes will be on the actual business Yahoo operates itself in two weeks on Oct. 22, when the company announces third-quarter results. Sources said the quarter will come in as expected, but will still tell a story of lackluster growth in advertising, engagement and, well, every key part of its native offerings.

That said, Mayer is expected to be on the call — her first at Yahoo — to outline her grand vision in more detail, as a spokeswoman has noted.

That’s good, since shiny profiles of her can only do so much. It’ll be nice to finally hear her say something definitive in public about how she’s going to fix the company that has given the mediagenic exec even more press.

(And, let’s hope, without the tweets, Manolos and pineapple malts.)

]]> http://allthingsd.com/20121008/here-come-the-inevitable-marissa-mayer-magazine-profiles-as-she-preps-her-quick-return-to-yahoo/feed/ 0 http://allthingsd.com/20120904/facebook-8-k-zuckerberg-will-not-sell-any-shares-for-one-year/ http://allthingsd.com/20120904/facebook-8-k-zuckerberg-will-not-sell-any-shares-for-one-year/#comments Tue, 04 Sep 2012 21:01:18 +0000 Kara Swisher http://allthingsd.com/?p=247546

In a regulatory filing today, seeking to steady its declining shares, Facebook said that its CEO and co-founder Mark Zuckerberg will not sell any of his over 500 million in shares of the social networking company, including to pay taxes related to compensation awards he receives.

The move is part of damage control by Facebook, whose stock closed today at $17.73, a new low. That’s more than 50 percent off its May IPO price of $38 a share.

In addition, the filing said that Facebook board members Marc Andreessen and Don Graham would also refrain from share sales, except to pay taxes.

Finally, the company said it would use cash or credit to pay about $1.9 billion in taxes due on the awarding of upcoming employee restricted stock units. Facebook could have sold shares to pay the bill, which might have further depressed the price of the stock. Facebook would not do anything to prevent most staffers from selling their shares.

More than 1.5 billion Facebook shares will be hitting the market over the next year, which has caused investors to shy away from the stock.

Facebook’s stock rose 1.75 percent on the news in after-hours trading, to $18.04.

Here is the full 8-K filed by Facebook:

FACEBOOK_INC_8K_20120904

]]> http://allthingsd.com/20120904/facebook-8-k-zuckerberg-will-not-sell-any-shares-for-one-year/feed/ 0 http://allthingsd.com/20120904/whats-next-for-facebooks-flagging-stock-perhaps-investors-will-finally-get-real/ http://allthingsd.com/20120904/whats-next-for-facebooks-flagging-stock-perhaps-investors-will-finally-get-real/#comments Tue, 04 Sep 2012 13:00:19 +0000 Kara Swisher http://allthingsd.com/?p=247200

As everyone with a pulse knows, Facebook shares took another dive Friday to reach the lowest level yet since its ignominious public offering in May.

Shares closed at $18.06, down 5.4 percent, which is half of its happier $38 IPO price. Actually, more than half, with a 52.3 percent decline overall since then.

Investors are not pleased. Facebook employees are not pleased. Even the New York Times Dealbook’s Andrew Ross Sorkin finally got unpleased, and unloaded on Facebook’s CFO David Ebersman (who has been under attack, by the way, for a while now).

“When Facebook’s I.P.O. first started to appear troubled back in May, I purposely avoided weighing in. Frankly, I thought it was too soon to judge,” wrote Sorkin. “But we have passed the pivotal three-month mark.”

Pivotal! Ruh-roh.

Actually, the Silicon Valley social networking giant will have to pivot for quite a while going forward, for a myriad of reasons.

Most of all, as John Paczkowski noted on Friday, and is also well known:

“The expiration of Facebook’s first lockup on 271 million shares earlier this month tanked the stock. And with four more yet to go, there is clearly further volatility ahead. On Oct. 15, 249 million shares will become eligible for sale. On Nov. 14, the lockup will expire on 1.32 billion shares. On Dec. 14, another 49 million shares. And on May 13, 2013, the final 47 million shares.”

In other words, that’s a lotta lockups to be unlocked.

And, as you can see from these two helpful lockup-expiration-focused charts for a range of other tech IPOs of late from SNL Kagan, that means a lot of downside for Facebook’s stock:

But, as I noted, this is already known by all, as Business Insider’s Henry Blodget — who has done some of the sharpest analysis on the troubled stock story at Facebook — correctly noted in a post titled, “It’s Becoming Clear That No One Actually Read Facebook’s IPO Prospectus Or Mark Zuckerberg’s Letter To Shareholders” on Friday.

“As Facebook’s stock continues to collapse, the volume of whining is increasing,” wrote Blodget. “As I listen to all this whining, I have a simple question: Didn’t anyone even read Facebook’s IPO prospectus? The answer, I can only assume, is ‘no.’”

No, they did not, or they might have read about everything from the company’s slowing growth rate to its mobile issues to, yes, all those billions of lockups to come.

Also, he noted, a bit of math would have yielded the high price-to-earnings ratio, which remains high at Facebook’s current low stock price, especially compared to Google and Apple.

That does not mean everyone is gnashing teeth. One of Facebook’s key Wall Street underwriters, J.P. Morgan, gave a stronger thumbs-up to the company in a note released yesterday for the future, even as it cut back on its target price by 33 percent.

The worst news: J.P. Morgan’s Doug Anmuth gave Facebook shares a $30 target, which is still far below his $45 target in late June.

Still, he also struck a sunnier note, saying he expects advertising revenue at Facebook to rise in the next year, even as payments revenue and overall profitability will be less.

Anmuth also said he expects Facebook to repurchase some of its now-cheaper shares to settle its tax bill related to restricted stock units via the credit or cash, rather than stock sales.

“This would essentially amount to a buyback of ~120M shares totaling $2.2B at current prices, and it would reduce the outstanding share count,” he wrote.

That’s probably cold comfort to shareholders, especially given most Wall Street analysts have urged buying, even as the stock has dropped.

Then again, since it’s not yet clear where the bottom truly is for Facebook shares, it is at least one less thing to worry about.

]]> http://allthingsd.com/20120904/whats-next-for-facebooks-flagging-stock-perhaps-investors-will-finally-get-real/feed/ 0 http://allthingsd.com/20120817/video-exclusive-heres-groupons-andrew-mason-talking-about-daily-deals-sites-stock-smack-future-plans-and-ipo-regrets-or-lack-thereof/ http://allthingsd.com/20120817/video-exclusive-heres-groupons-andrew-mason-talking-about-daily-deals-sites-stock-smack-future-plans-and-ipo-regrets-or-lack-thereof/#comments Fri, 17 Aug 2012 14:14:50 +0000 Kara Swisher http://allthingsd.com/?p=242517

It’s not well known, but last year, before it went public, Groupon almost didn’t.

With pressure from former board member Howard Schultz, and also doubts about timing expressed to CEO Andrew Mason by outside investors such as Silicon Valley luminaries Marc Andreessen and Mary Meeker, the Chicago-based daily deals site pressed forward, anyway.

Since then, it has been a tough ride for Groupon and, perhaps most of all, for Mason.

Yesterday afternoon, I got on Skype to do a video interview with him about the continued swirl — much of it very negative — around the company he co-founded and leads.

“I love Groupon,” he said. “Groupon is my life.”

Not so much everyone else these days — who are starting to compare the company to Web 1.0 flameout Webvan and even, in the ultimate digital insult, Pets.com.

That’s a false comparison — those were both never profitable, and had negative cash flow, unlike the much larger Groupon.

Still, Groupon’s stock has been under pressure pretty much since the time of its IPO last year, with critics hammering on everything from whether its business plan is fundamentally flawed to its controversial accounting to the goofy nature of Mason himself.

He even got dinged for drinking a beer at a Groupon all-hands employee meeting. (I’m fine with that one, by the way.)

Groupon shares hit a new low last week, after it reported second-quarter earnings that showed better profits, but a revenue miss. Growth prospects in its core coupon business, or lack thereof, was pointed to by Wall Street investors for the continued sell-off.

One bright spot was its nine-month-old Groupon Goods, which sells a variety of products and which has grown to $200 million in annualized revenue. But the lower-margin offering makes up a smaller part of the company’s overall results, as does its impressive improvements in mobile commerce.

These two positive developments have failed to impress, though, with the stock at even lower lows today — at $4.74 a share. That’s down 82 percent since Groupon went public, making the company worth $3 billion, or about half of what Google had once offered to buy it, and a little more than double its cash on hand.

In other words, it is crunch time for Mason, who must answer to shareholders, employees and his board, and must somehow get Groupon to a better place, and fast.

Among the myriad of risks for him as he does: Everything from new management to the sale of Groupon.

That is not in the cards right now, of course. And, as usual, the affable exec talks with confidence about the company.

To his credit, in this long interview, he is also pretty candid about the struggle.

It’s well worth a watch (except for me looking like I just got off a red-eye flight, which I did).

Here’s Mason:

]]> http://allthingsd.com/20120817/video-exclusive-heres-groupons-andrew-mason-talking-about-daily-deals-sites-stock-smack-future-plans-and-ipo-regrets-or-lack-thereof/feed/ 0 http://allthingsd.com/20120809/mine-mine-all-mine-yahoo-says-it-might-just-keep-that-alibaba-money-for-itself-instead-for-shareholders/ http://allthingsd.com/20120809/mine-mine-all-mine-yahoo-says-it-might-just-keep-that-alibaba-money-for-itself-instead-for-shareholders/#comments Thu, 09 Aug 2012 20:50:48 +0000 Kara Swisher http://allthingsd.com/?p=239824

Yahoo just filed a regulatory document noting that it might not give back the bulk of the $4 billion-plus that it is expecting to get from its sale of a chunk of its Alibaba stake to shareholders, as it had previously said it would, either via a stock buyback or dividend.

Instead, CEO Marissa Mayer looks like she wants all that dough to buy some tasty companies.

The filing noted that Mayer’s recent look-see review of Yahoo, “may lead to a reevaluation of, or changes to, our current plans, including our restructuring plan, our share repurchase program, and our previously announced plans for returning to shareholders substantially all of the after tax cash proceeds of the initial share repurchase.”

Yahoo’s stock is down about five percent on the news, in after-hours trading, to $15.28. It had been moving up slowly in recent weeks.

That’s because, for investors, this is a drastic reversal of previous Yahoo statements on what it was going to do with the windfall. At the time of the deal and then later in several statements by its top execs, Yahoo said it would return the most of the money to shareholders.

“We look forward to delivering the proceeds of the near-term transaction to our shareholders,” said CFO Tim Morse at the time of the deal’s announcement in May, which he later reiterated on an earnings call.

Related to the deal, the Yahoo board had also recently authorized its execs to conduct a larger stock buyback, although the company was under no legal obligation to do so.

In addition, in a recent letter to his investors, Third Point’s Dan Loeb — now a Yahoo director and in charge of a six percent stake — said the company “has indicated that it will return substantially all of the expected $5B of cash it will receive from this transaction to shareholders.”

No longer — at least for most of the incoming pile of moolah from China.

Still, the move probably should come as no surprise, given Mayer is already on the prowl for innovative companies to buy and talent to “acqhire.”

She’ll certainly need a bigger war chest, since Yahoo only has just above $2 billion in cash now, not all of which is available (long accounting reason I will go into later).

The big slug of Alibaba money, from selling half of Yahoo’s stake in the Chinese company, will obviously give her more heft.

So, too, would any money she might get from a deal around Yahoo’s Japanese assets. The company has been in protracted talks with SoftBank, its partner there, about such a sale. While sources said it was close to completion, there appears to still be some roadblocks to its final settlement.

Depending on how such a transaction is completed — tax-free or not — Yahoo could get about $3 billion in cash and perhaps another asset worth $1.5 billion.

That would certainly give Mayer a bigger kitty to do acquisitions — and presumably make lots of friends in Silicon Valley in the process.

Here is the pertinent section of the filing:

New Chief Executive Officer and Review of Business Strategy

On July 17, 2012, Marissa Mayer became the Chief Executive Officer and a member of the Board of Directors of Yahoo! Inc. (the “Company”). As reported in our Form 10-Q for the quarter ended June 30, 2012 filed today with the Securities and Exchange Commission, Ms. Mayer is engaging in a review of the Company’s business strategy to enhance long term shareholder value. As part of that review, Ms. Mayer intends to review with the Board of Directors, among other things, the Company’s growth and acquisition strategy, the restructuring plan we began implementing in the second quarter of 2012, and the Company’s cash position and planned capital allocation strategy. This review process may lead to a reevaluation of, or changes to, our current plans, including our restructuring plan, our share repurchase program, and our previously announced plans for returning to shareholders substantially all of the after tax cash proceeds of the initial share repurchase under the Share Repurchase and Preference Share Sale Agreement we entered into on May 20, 2012 with Alibaba Group Holding Limited.

And here is the whole filing:

YHOO-20120809-8K-20120809

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