Yahoo profit misses forecasts

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Yahoo profit misses=20 = forecasts

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By Jon Swartz, USA TODAY

SAN FRANCISCO =97 Yahoo (YHOO)=20 on Tuesday said second-quarter profit tumbled 19%, as it grapples = with a=20 wheezing economy and the specter of Microsoft's takeover = bid.

The Internet pioneer reported earnings of = $131=20 million, or 9 cents a share, during the quarter, compared with = $161=20 million, or 11 cents a share, in the same quarter last year.

Financial analysts, on average, had = forecast earnings=20 of 11 cents a share, according to Thomson Reuters.

Revenue rose 6% to $1.8 billion. Excluding=20 commissions paid to Yahoo's advertising partners, revenue was = $1.35=20 billion =97 about $20 million below the average estimate by = analysts.

The lackluster numbers could heighten = pressure on=20 Yahoo executives to jack up the company's sagging stock price = after=20 spurning a $47.5 billion takeover offer from Microsoft in May, = analysts=20 say.

"Not great," says Roger Kay, president of = market=20 researcher Endpoint Technologies Associates. "They wouldn't have = come=20 close to their numbers (last year)" if not for foreign = subsidiaries.

The results came a day after Yahoo reached = an=20 agreement with activist shareholder Carl Icahn to avoid a bruising = proxy=20 fight next week.

Icahn will join an expanded board, with two = of his=20 supporters, based on the accord.

"We're pleased with the progress we've made = the last=20 several months, and the board and management is dedicated to = maximizing=20 shareholder value," Yahoo CEO Jerry Yang said in a conference = call.

Last month, Yahoo also said it would = reorganize into=20 three new divisions to help centralize its Internet products, = build its=20 worldwide audience and better capitalize on the growth of online=20 advertising.

Yahoo anticipates a revenue windfall from = its recent=20 search-advertising partnership with rival Google.

As a result, Yahoo said it's not changing = its=20 financial view for 2008 despite an ominous economy that is tamping = down=20 online advertising.

The news sent Yahoo shares up 2% to $21.83 = in=20 after-hours trading. In regular trading, they closed at $21.40. =

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