Tue July 16, 2013
Is Yahoo Making A Comeback?
Is Yahoo making a comeback? The company’s stock is up nearly 36 percent this year.
Investors have had high hopes since the arrival of CEO Marissa Mayer, who joined Yahoo from Google.
Jason Bellini of the Wall Street Journal joins us to talk about how the company is doing overall.
- Jason Bellini, video reporter and senior producer for the Wall Street Journal. He tweets@jasonbellini
JEREMY HOBSON, HOST:
From NPR and WBUR Boston, I'm Jeremy Hobson. It's HERE AND NOW. Some big new on Wall Street today. Goldman Sachs reported that its profits doubled last quarter compared with a year ago, and banking is not the only industry on a tear right now. Tech stocks are at all time highs, and we're going to focus now on one company that is reporting its financial results today. That would be Yahoo! Its stock price is up nearly 36 percent this year. So what is going on? Senior producer and reporter Jason Bellini of the Wall Street Journal joins us to explain. And Jason, welcome.
JASON BELLINI: Good to be with you, Jeremy.
HOBSON: So, you know, investors had high hopes with Yahoo! since the arrival of the new CEO, Marissa Mayer, who joined from Google. What has she done that has changed this company?
BELLINI: Well, what she's done has really impressed the market. She's presided over a 75-percent rally since she took over last year. And one part of that is optimism in her plan to increase ad sales revenue. But that growth in stock value is - and company value - has really been driven mostly by the Asian assets of Yahoo!
They've got huge stakes in Alibaba, and they sold off half of that stake and have earned $7.6 billion in revenue, giving her money to play with to make a whole lot of investments to try to create a whole new Yahoo!, to turn things around as they've been slipping against their rivals.
HOBSON: What is the whole new Yahoo! that you're talking about? I mean, is it going to be a search engine, as it has been, or a social network or something else?
BELLINI: Well, her plan, Mayer's plan, is to make it what she describes as a way to satisfy four daily habits: search, email, home page and mobile. She talks a lot about increasing personalization of the home page as a way to attract advertisers. They can reach very specific interests and needs. She also put a big focus on redesigning the company's suite of mobile apps. That includes the Yahoo! mail, Sportstacular, their one - their all-in-one Yahoo! app.
And we're also reporting today here at the Wall Street Journal that they're in talks to get their apps pre-installed on Apple's iPhone. Now, we don't hear talk about them trying to create a parallel social network to Facebook but just really to revamp, improve and try to make Yahoo! the home for people, especially people who are into their other products that they've purchased.
HOBSON: And Yahoo! has been, under Mayer, trying to acquire not just the talent that's all around Silicon Valley, as many of Yahoo!'s rivals do, but also to try to acquire other companies.
BELLINI: That's right. They've actually snapped up 17 technology startups since she came onboard from Google. And I mean the biggest one was Tumblr; it cost them $1.1 billion. They're calling that a long-term bet on trying to bring a younger demographic to Yahoo!
These deals also bring in a lot of engineering talent as well. Another thing that they're really working on is Flickr, by bringing that in and by, as she just says, making it awesome again, in trying to create these parallel products that will all become part of the suite of the new Yahoo!
HOBSON: And Jason, before we let you go, how is Yahoo! doing compared with the other tech companies, which are also doing very well right now?
BELLINI: Well, it's been doing extraordinarily well. At the top of heap this year has been LinkedIn. It's up over 77 percent. But among big techs, Yahoo!'s been number two. It's up over 35 percent. Google's at 25 percent, Amazon over 19 percent. Facebook's down 7.5 percent. But again, these results are going to be coming out after the bell today, and investors are going to watching to see, is Mayer delivering on this promise yet?
She's asked for some time to accomplish it, but it's a tall order to get people to spend more time on Yahoo!, and that's really her mission.
HOBSON: Jason Bellini, senior producer and report at the Wall Street Journal. Transcript provided by NPR, Copyright NPR.