Yahoo’s shares tumbled in after-hours trading after the company gave guidance that disappointed Wall Street. The company said net income was $159 million, or 11 cents per share, down 37 percent with $254 million, or 17 cents, a year earlier. Revenue jumped 19 percent to $1.58 billion. Excluding fees that Yahoo pays to its partners, sales rose 20 percent to $1.12 billion. Adjusted for items such as stock-based compensation expenses, profit was $234 million, or 16 cents. On that basis, Wall Street analysts had expected the Sunnyvale, Calif.-based company to report earnings of 11 cents on sales of $1.14 billion, according to Thomson Financial.
Looking ahead, the company forecasted gross profit in the fourth quarter of between $957 million to $1.04 billion with sales excluding so-called traffic acquisition costs of between $1.145 billion and $1.037 billion. Profit for the year is expected to bet $3.69 billion to $3.777 billion on sales of $4.477 billion to $4.597 billion. The revenue forecasts are below the $1.31 billion quarterly and $4.66 billion figures that Wall Street had expected, according to Thomson Financial.
Yahoo fell 3 cents to $24.15 in regular trading. After hours, the shares dropped 60 cents, or 2.5 percent, to $23.50; the regular trading drop was less than one percent.
Yahoo’s earnings report capped off an eventful day for the company on the acquisition front. The company announced that it had acquired AdInterax, a provider of rich media solutions to online publishers and purchased a 20 percent stake in Right Media Exchange, an auction marketplace for Web advertising. Terms of both deals were not disclosed.
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