Earnings: YHOO ‘s Yang: ‘No Sacred Cows’

The first thought while listening to the Yahoo 2Q07 earnings call with CEO Jerry Yang, president Sue Decker and CEO Blake Jorgensen: the Yahoos could raise a lot of money for a favorite charity by charging one of the execs every time they use the word ecosystem after, say, three instances. Second thought: How would this all sound if it came from a completely new team instead of a co-founder who has been on the board and a veteran senior exec who was part of the decision making? Third: no one really fills the salesman shoes of Terry Semel on this call but that’s not necessarily bad. Four, CFO Blake Jorgenson is a good addition. (For the full flavor, the transcript is now up at SeekingAlpha.)

Jerry Yang: The next 100 days or so are pivotal; there are “no sacred cows. … We need to move very quickly.” While revenues are expected to come in at the mid-low level of guidance for the second half of the year, “We think it’s critical to maintain the same investment profile.” (That point was made numerous times in the execs’ prepared remarks.)

— “I am very well aware of the challenges we face. There’s a significant gap between where Yahoo is and where we need to be. For example, while we’re the largest consumer destination on the web today, we are becoming smaller as a percentage of the overall web’s activity. … The good news is we’re starting with some awesome assets.”

— “I went to set a new bar for the Yahoo culture; Yahoo’s employees are the keys to our success.” He said the technology leadership search is well underway and that they’re committed to bringing on leaders across the company to complement those already there.

Sue Decker: “We have at times been risk-averse to making hard personnel decisions.” Recent departures have been been viewed as a “sign of concern” but “in many respects” are “a sign of renewed discipline. … They have opened up many opportunities for new talent that is most able to drive our business forward based on today’s business requirements.”

— Continuing the evolution of the org structure is “one of my highest priorities.”

— “We believe that many of the legacy issues that are hampering growth will soon be behind us.”

Panama: “The global rollout is progressing extremely well” and is producing “real financial gains” as of this quarter. The new algorithm was turned on in Japan last week. The migration is almost complete in UK and Europe; the algorithm will be turned on in UK in just a few weeks. Migration also is underway in Taiwan, Hong Kong, Korea, Brazil, and Australia; all are expected to be operational with the new algorithm by the end of 2007.

SmartAds: Launched in Yahoo Travel first, two weeks ago, and will be in other key categories by the end of the year. Wouldn’t expect a major impact this year but should start to see in 2008.

Right Media: The “vast majority” of inventory will migrate to the new addition this year.

International: Jogensen: “Overall, international is reflecting slower growth in both O&O and affiliate search, neither of which benefit from Panama until late this year. Our ecommerce business in Europe has also experienced some competitive pressure.”

Changes: Responding to a question, Yang said not to expect “big bang” announcements about what Yahoo will and won’t emphasize. “We will always be making adjustments as a philosophy of how we continue to make decisions of shifting resources around and really act much more as a one company rather than a bunch of smaller entities within a bigger company.”