Yahoo! posted a modest Q1 2008 (PDF) with Revenue of $ 1.86 9% higher than $ 1.67 same time last year. Profits were higher though not directly from Yahoo! operations. For Q1 2008 Yahoo!'s profits were $542 million compared to $142 last year. However, $401 came from Alibaba.com IPO. So excluding this IPO gain, profit per share was 11 cents just 1 cent higher than Q1 07 of 10 cents. Compare this with the stellar $5 billion Q1 that Google had. Does Y! have any legit hopes of beating the Microsoft acquisition effort?
These numbers would not change much for the Microsoft bid of $31 per share (after the earnings release Y! stock is trading around $28 -- where it rose to after languishing around the $ 20 mark before MSFT made its bid). And Steve Ballemer said just the same:
"We know what Yahoo is worth to us. We offered a lot of money: $44 billion, it is not a lot of euros anymore. If their board thinks that's fair, great. If not, we'll move forward," Ballmer said onstage after an address at an information technology event.
He did not explain what he meant by moving forward.
Ballmer later told a news conference, "Time is money. We made clear in the last letter we sent" to Yahoo's board. "We'll see what happens." Yahoo faces a Saturday deadline to respond to Microsoft, after which Microsoft has said it will launch a proxy battle to unseat Yahoo's board.
Therese Poletti has a story on Market Watch that states that Yahoo! management has lost the credibility battle:
Quizzing the company's management on an "investor presentation" the company filed last month with the Securities and Exchange Commission, Jeffries & Co. analyst Youssef Squali expressed a healthy set of doubts about the company's vision for its future. He noted that Yahoo (YHOO) was projecting growth for the next couple of years that "far outstrips" the projected growth of the online advertising market, where Yahoo has ceded its leadership position to Google Inc."So clearly if you look at the Street estimates, they're a lot lower and apply a fair amount of skepticism," Squali said on the call. This from an analyst who's highly bullish on Yahoo and expects the company to be able to squeeze a higher price from Microsoft Corp.The question points to a problem Yahoo may be facing as it continues to spurn Microsoft's $40 billion-plus takeover offer. Namely, Wall Street seems to doubt the Web giant's credibility as it tries to make its case for the health of its business and why Yahoo could remain independent.
