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Yahoo! Inc. (YHOO)

  • Nov. 12, 2014, 3:10 AM
  • Nov. 11, 2014, 4:58 PM
    • "BrightRoll is a large, growing and profitable business with net revenues expected to exceed $100 million this year," says Yahoo (NASDAQ:YHOO) as it announces its acquisition of the video ad platform. The deal is expected to close in Q1 2015.
    • Yahoo notes BrightRoll's programmatic (automated) ad platform handles ad-buying for 87 AdAge Top 100 U.S. advertisers, as well as all of the top 10 demand-side (advertiser-facing) online ad platforms. Meanwhile, BrightRoll's publisher-facing offerings monetize ad inventory for "tens of thousands" of sites/apps.
    • Yahoo, hungry for some time to grow its video ad scale and put an end to its display ad revenue declines, declares acquiring BrightRoll "will dramatically strengthen Yahoo's video advertising platform, making it the largest in the US."
    • The acquisition price is lower than the ~$700M previously reported by TechCrunch. Yahoo just reaped $6.3B in post-tax Alibaba IPO proceeds; it has promised to return at least half of the sum to shareholders.
  • Nov. 10, 2014, 2:59 PM
    • Hortonworks, provider of one of the two most popular software distributions for the Hadoop big data/analytics framework, has filed for an IPO under the symbol HDP. Underwriters include Goldman, Credit Suisse, RBC, Pac Crest, and Wells Fargo. (prospectus)
    • For now, Hortonworks is only filing to raise up to $100M, but given the company was valued at over $1B in an early-2014 funding round, that figure might rise. Yahoo (YHOO +1.7%), which spun out Hortonworks in 2011 in tandem with VC firm Benchmark, has a 19.6% pre-IPO stake. Teradata (TDC +1.9%) owns 8.3%, and H-P 5.9%.
    • Both sales and losses have been growing rapidly as enterprises embrace Hadoop to analyze giants sets of unstructured data, and Hortonworks spends aggressively to go after the opportunity. Revenue for the nine months ending Sep. 30 totaled $33.4M (+110% Y/Y), and net loss $86.7M.
    • Gross billings for the 12 months ending Sep. 30 totaled $65.7M. Hortonworks had 233 support subscription customers at the end of the period.
    • Cloudera, Hortonworks' biggest rival, raised $900M in March ($740M from Intel) at a $4.1B valuation. Both Hortonworks and Cloudera have been working to add enterprise-class reliability and management features to their Hadoop distributions.
  • Nov. 9, 2014, 11:48 AM
  • Nov. 5, 2014, 11:32 AM
    • Plenty of firms (including many of the underwriters who just launched coverage) have hiked their Alibaba (BABA +3.5%) after the company beat FQ2 revenue estimates yesterday (while posting in-line EPS) on the back of strong GMV growth and improving mobile monetization.  Both Alibaba and Yahoo (YHOO +2.3%) are making fresh highs.
    • In addition to Alibaba's gains, Yahoo is benefiting from a bullish launch from SunTrust's Robert Peck. Peck considers the weakness in Yahoo's core properties priced in, and believes the Street is "giving little credit to some of the progress made more recently around mobile, native [ads], Tumblr, search, and video." He estimates the core business is being valued at less than 1x EV/EBITDA.
    • Morgan Stanley likes Alibaba's 262% Y/Y mobile GMV growth, and thinks the acceleration seen in Taobao GMV points to improved conversion rates. Meanwhile, Jefferies and BofA/Merrill are pleased with management remarks suggesting an average customer's spending grows considerably over time.
    • Cantor: "A differentiated pricing model, strong brand and unmatched scale continue to give Alibaba an unfair competitive advantage relative to peers both in and outside China. We believe the company's outsized growth and margin profiles should support higher valuation over time."
    • The firm has hiked its FY15 revenue and EPS estimates, albeit while slashing its EBITDA estimate on expectations spending will remain elevated. Alibaba, for its part, doesn't plan to provide guidance.
  • Nov. 4, 2014, 10:19 AM
    • Alibaba (NYSE:BABA) is up 2.7% after beating FQ2 revenue estimates on the back of 54% Y/Y growth - it was driven by a 49% increase in GMV, and more than a 3x increase in mobile monetization rate. EPS was only in-line, as aggressive spending yielded an 890 bps drop in non-GAAP EBITDA margin.
    • Yahoo (YHOO +1.3%) is moderately higher following the numbers. Its remaining 384M-share stake in Alibaba has a current pre-tax value of $40.2B. SoftBank's (OTCPK:SFTBF) 797.7M-share stake has a pre-tax value of $83.4B.
  • Oct. 30, 2014, 2:09 PM
    • Lisa Utzschneider, formerly Amazon's display ad chief, is now Yahoo's (YHOO +0.3%) SVP of Americas sales. She'll be in charge of all North/South American ad sales teams. (PR)
    • Ned Brody, hired just over a year ago from AOL (following a legal squabble) to be Yahoo's Americas ad chief, is now its SVP of ad tech and strategy. Kara Swisher reported last week Marissa Mayer's relationship with Brody "remains strained," and that a search for a replacement was ongoing.
    • The Americas accounted for 76% of Yahoo's Q3 revenue. The region's sales rose 2% Y/Y, with search ad growth offsetting a display ad decline.
  • Oct. 22, 2014, 11:36 AM
    • "We have the best tax experts in the country working intensively on structures to maximize the value to our shareholders of our remaining stake in Alibaba," said Marissa Mayer during Yahoo's (NASDAQ:YHOO) Q3 CC. Her company is set to pay $3.3B in taxes on its sale of 140M Alibaba shares at IPO time.
    • CFO Ken Goldman added Yahoo "negotiated hard" with Alibaba to "be able to take actions" during the 12-month lockup period for its remaining 384M-share Alibaba stake that would leave Yahoo "in position to create structures or approaches that would allow us to hopefully presumably take advantage of minimizing taxes."
    • FBR has cited Yahoo's tax-saving efforts as a reason for upgrading shares to Outperform post-earnings; it sees up to $13/share in potential savings. The firm is also upbeat about Yahoo's mobile efforts.
    • In the wake of TechCrunch's report about a potential BrightRoll acquisition, Marissa Mayer responded to a question about acquiring a programmatic ad company by suggesting Yahoo is open to buying a firm that's "either in the building block category or the strategic category," albeit while cautioning "more consideration" would be needed.
    • As expected, the 24% Y/Y drop in Yahoo's display ad prices was attributed to low prices for native ads (often shown on mobile devices); Mayer said Yahoo is looking to boost prices by improving targeting. Regarding search ads, she noted paid click growth (flat Y/Y) was pressured by ad quality improvements in Asia-Pac; Americas paid clicks were up 9%.
    • Prior Yahoo earnings coverage
  • Oct. 22, 2014, 9:19 AM
    | 1 Comment
  • Oct. 21, 2014, 5:56 PM
    • Yahoo (NASDAQ:YHOO) recorded a $6.3B Q3 post-tax gain related to its Alibaba IPO windfall. The company expects to pay $3.3B in cash taxes related to the sale Q1 2015.
    • The company disclosed on its CC mobile was responsible for $200M of Yahoo's Q3 revenue (17% of total). It expects full-year gross mobile revenue (doesn't back out traffic acquisition costs) of more than 1.2B.
    • Marissa Mayer predicts Tumblr (acquired last year for $1.1B) will produce over $100M in 2015 revenue, and generate positive EBITDA.
    • YHOO +2.1% AH. Q3 results, guidance/details.
    | 1 Comment
  • Oct. 21, 2014, 4:36 PM
    • Yahoo (NASDAQ:YHOO) guides in its Q3 earnings slides (.pdf) for Q4 revenue (ex-TAC) of $1.14B-$1.18B, above a $1.17B consensus. Op. income is expected to fall to $190M-$230M from $330M a year ago.
    • Buybacks provided a lift to Q3 EPS: $282M worth of shares were repurchased, and Yahoo entered into a $1.1B accelerated repurchase agreement under which it "prepaid $1.1 billion and received an initial delivery of approximately 15 million shares on September 30, 2014." A final settlement occurred on Oct. 17, through which $933M worth of shares were repurchased.
    • The company previously promised to return at least half its Alibaba IPO proceeds (pre-tax value of $9.4B) to shareholders.
    • Q3 display ad revenue (ex-TAC) -6% Y/Y to $396M, slightly better than Q2's 7% drop. Display ads sold +24%, but price per ad -24%; the transition to native ads from traditional banner ads likely contributed to both swings.
    • Search ad revenue (ex-TAC) +6% to $450M, even with Q2's growth. Search click revenue (excludes Microsoft payments) +17%; paid clicks were flat, but price per click rose 17%.
    • Americas revenue +2% to $831M; EMEA +2% to $81M; Asia-Pac -2% to $182M. Opex +6% to $1.05B.
    • Q3 results, PR
  • Oct. 21, 2014, 4:07 PM
    • Yahoo (NASDAQ:YHOO): Q3 EPS of $0.52 beats by $0.22.
    • Revenue of $1.09B (+0.9% Y/Y) beats by $50M.
    • Shares +2.2% AH.
    • Press Release
  • Oct. 21, 2014, 10:28 AM
    • BrightRoll, long seen as an IPO candidate, offers video ad buyers a network of 21K+ sites and apps. It both directly sells to advertisers looking to run programmatic (automated) video ad campaigns across the network, and also connects with 3rd-party ad platforms such as Google's DoubleClick, AOL's, and Facebook's LiveRail.
    • comScore estimates BrightRoll's network reached 155M U.S. users as of June. The company was reported last year to pulling in over $100M/year in revenue.
    • TechCrunch reports hearing Yahoo (YHOO +1.3%) has signed term sheets with BrightRoll, and that a deal (if it closes) is likely to involve a ~$700M-$725M price.
    • Yahoo, which just reaped an Alibaba IPO windfall, has been hungry to grow its video ad sales for some time. The company has signed a slew of video content deals and acquired streaming tech developer RayV, and is reportedly thinking of launching a YouTube rival (possibly while leveraging Tumblr)
    • Fellow video ad tech provider TubeMogul (TUBE +2.5%) is rallying; its market cap is currently $398M
  • Oct. 20, 2014, 5:35 PM
  • Oct. 20, 2014, 2:29 AM
    • Yahoo (NASDAQ:YHOO) is expected to outline cost-cutting efforts and give details of how it is evaluating possible acquisitions tomorrow, as the company faces pressure from activist investor Starboard Value.
    • The struggling Internet business is considering buying one or more large technology start-ups with some of the $5.8B it made off of Alibaba's IPO.
    • Acquisitions could trigger significant new streams of revenue at Yahoo, where sales have declined in four out of the past five quarters.
  • Oct. 14, 2014, 7:04 PM
    • Washington Post chief revenue officer Kevin Gentzel is leaving to become Yahoo's (NASDAQ:YHOO) head of North American ad sales.
    • News of Gentzel's hiring comes ahead of Yahoo's Oct. 21 Q3 report, and follows a Q2 in which Yahoo saw a 7% Y/Y drop in display ad sales.
    • Gentzel will report to Ned Brody, hired from AOL a year ago to be Yahoo's Americas ad chief. COO/sales chief Henrique de Castro was fired in January following a rocky 15-month tenure.
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Company Description
Yahoo! Inc is a technology company. It offers search, content and communication on mobile phone, tablet or desktop.