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Yahoo Earnings Disappoint Again in Marissa Mayer’s (Likely) Last Stand

Company is in final stretch of process to auction itself off

Yahoo reported earnings on Monday that coincide with Wall Street’s low expectations for the second quarter of 2016, but CEO Marissa Mayer feels that the company is making strides despite being for sale. Mayer said on a call with investors that she has nothing to announce regarding the company’s sale, but she admitted that it is “deep into the process.”

“With the lowest cost structure and headcount in a decade, we continue to make solid progress against our 2016 plan. Through disciplined expense management and focused execution, we delivered Q2 results that met guidance across the board and in some areas exceeded it,” Mayer said. “In addition to our efforts to improve the operating business, our board has made great progress on strategic alternatives. We are relentlessly focused on delivering shareholder value.”

Yahoo reported a revenue of $1.3 billion, up 5 percent year over year, while revenue excluding traffic acquisition costs dropped 19 percent to $842 million with adjusted earnings per share of nine cents.

Wall Street analysts expected Yahoo to report net revenue of $840 million, excluding traffic acquisition costs and adjusted earnings of $148 million and adjusted EPS of 10 cents. Yahoo disclosed that during the 2016 Q2, it took goodwill impairment charges totaling of $482 million for Tumblr.

It could be Mayer’s last earnings as CEO, as her reign atop Yahoo has been embattled almost since her arrival in 2012. Her task was to transform the tech company from a fading search giant, and it hasn’t been going too well.

Her strategy of investing heavily in high-profile personalities like Katie Couric and takeovers of sites like Tumblr hasn’t yielded the desired growth, resulting in a current auction of the company’s core Internet business. Her pay in 2015 was $35.9 million, representing a 14.5 percent drop from the Yahoo CEO’s compensation in 2014, but she’ll get a $55 million golden parachute if the company is sold.

Mayer said that despite “distractions and uncertainty,” the Yahoo team has laid the right groundwork for the company’s “next chapter,” and she remains confident that the last few years have been “the right steps to create a better Yahoo.”

On a call with investors, Mayer said Yahoo’s headcount has returned to 2005 levels. The company generated $246 million when it sold Santa Clara property.

During Q2, Yahoo updated Yahoo News, Sports and Finance on desktop along with new updated Sports and Finance apps. The company also hosted the first-ever live streams of Berkshire Hathaway’s annual shareholders meeting, which had more than 1.8 million views across devices in both English and Mandarin.

Yahoo also thrived with Adrian Wojnarowski’s coverage of the NBA Draft, which attracted approximately 3.7 million total views, with an average watch time of 34 minutes per user.

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