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Yahoo (YHOO) is expected to report Q2 earnings after market close today (Tuesday) with a conference call scheduled for 5:00 pm ET.

Guidance

The consensus estimate is 12c for EPS and $1.37B for revenue, according to First Call.

Analyst Views

Lately, analysts say that expectations are so seriously dampened for Yahoo because the company has been so seriously distracted by trying to fend off Carl Icahn and Microsoft (MSFT).

Citigroup's Mark Mahaney published his "cheat sheet," which is always helpful. He said that GAAP EPS north of 10c would be considered positive, below 9c would be negative. Mahaney estimates 8c. In terms of revenue, north of $1.38B would be good; south of $1.37B would be bad. Mahaney expects $1.38B. Looking towards guidance, Mahaney said that full year guidance above $7.6B would be good; south of $7.5B would be bad. He's expecting $7.49B. Other metrics to watch include -- owned and operated display ad revenue should grow between 12% and 15% YoY, O&O gross search ad revenue up between 16% and 18% YoY, and fees revenue should be around $220M.

The consensus thought is that Q2 is likely to be a non-event given the negative pre-releases from Valueclick (VCLK) and Bankrate (RATE), which highlights the weakening fundamentals in the ad network and comparison shopping businesses. General thinking is that fundamental results are likely to be soft, due to the recession, increased competitive pressures, and execution challenges. Thomas Weisel said the early read on July suggests Q3 could degrade further relative to Q2 results. The firm has been hearing from agencies that online display budgets are occasionally getting cut and that spending, when it does occur, can be unpredictable and lumpy.

But Yahoo remains primarily an event stock related to a potential transaction with Microsoft, Time Warner's (TWX) AOL unit, or possibly News Corp (NWS). Key upcoming events: July 24th Microsoft Investor Day and the August 1st Yahoo! Shareholder Day.

Source: Earnings Preview: Yahoo