This week, Yahoo! parted ways with Chief Operating Officer Henrique de Castro, whom Chief Executive Officer Marissa Mayer poached from Google in October 2012. That's because the ship de Castro was steering - digital ads - has more than halved since 2008, and dropped from 6.8% to 5.8% in 2013.
- Yahoo-Tumblr Deal a Hail Mary Pass That May Never Pay Off
- If I Owned Yahoo (Nasdaq: YHOO) Stock, I'd Be Pissed
- Yahoo (Nasdaq: YHOO) Needs More Than Just a New CEO
- More Reasons to Avoid Yahoo (Nasdaq: YHOO) Stock
- Is Google (Nasdaq: GOOG) Plotting a Yahoo (Nasdaq: YHOO) Takeover?
- Yahoo's New CEO: The One Thing Scott Thompson Needs to Do
Money Morning Capital Wave Strategist Shah Gilani joined FOX Business' "Varney & Co." today (Thursday) to discuss the viability of tech stocks in 2014.
The hype and excitement that follow tech stocks can make them particularly volatile. Although Gilani cautions viewers against tech stocks that have reached 52-week highs, he generally believes tech stocks will soar in 2014, and states that "they're global, they're going to be here for a long time, and they're a good place to remain."
Gilani especially cautions viewers against Yahoo! (Nasdaq: YHOO), as he believes the "underlying numbers have not been looking great," highlighting lower display and search revenue in November.
Yahoo (Nasdaq: YHOO) stock has climbed more than 28% in the past three months and is up 97% year to date. Now the tech company is planning to acquire a startup that helps people exchange pictures and downloads.
Since Marissa Mayer took over as Yahoo's chief executive officer in 2012, the company has made more than 20 acquisitions, mostly startups.
Today (Monday), Money Morning Chief Investment Strategist Keith Fitz-Gerald appeared on FOX Business' "Varney & Co.," where he lent expert insight on the latest move by digital media giant Yahoo! Inc. (Nasdaq: YHOO).
On Friday, Yahoo acquired Evntlive, a concert-streaming startup that was co-founded by former Cisco Systems Inc. (Nasdaq: CSCO) Chief Technology Officer Judy Estrin.
After one year, Yahoo CEO Marissa Mayer has brought the company back from the brink of irrelevance; whether she can return Yahoo to its former glory has been an open question. But there is one key area in which Yahoo has surged ahead of even Google, and that could change everything...
The Yahoo-Tumblr deal is a $1.1 billion gamble aimed at rejuvenating a stagnating business, but is more likely to end up a costly mistake.
The deal, announced today (Monday), is by far Yahoo CEO Marissa Mayer's biggest - and riskiest - acquisition yet.
Yahoo! Inc. (Nasdaq: YHOO) wanted access to Tumblr's 117 million users, most of them teens and young adults, to give it a beachhead into the ever-more important world of social media.
Tumblr has grown rapidly by making it easy not only to create blogs, but for Tumblr users to follow and share one another's posts.
But Tumblr, like so many other social media companies, is not exactly a money machine. Analysts estimate the company's 2012 revenue was just $13 million, making it a pricey acquisition indeed.
Maybe it's the four CEOs in five years, the botched sale to Microsoft in 2008, or a Chief Executive Officer who can't be bothered to verify his own credentials in SEC filings.
Or maybe it's the dysfunctional board of directors and the erosion of massive amounts of shareholder value over the years.
Add it all up and you have an unmitigated disaster on your hands.
Activist shareholder Daniel Loeb, who owns 5.8% of the company through his hedge fund, Third Point, LLC, has every right to be angry and vocal about it.
The way I see things, Yahoo is following what I call the Christopher Columbus School of Management: it has no idea where it's going, has no idea where it's been and has no idea what to do when it arrives.
The Search for an Identity at Yahoo (Nasdaq:YHOO)Yahoo was ostensibly a search engine in the beginning. The latest outgoing CEO, Scott Thompson, had been trying to rebuild the beleaguered Silicon Valley company into one more reflection of his own strengths in data personalization as opposed to the bloated advertising-driven business it has become.
Whether or not Thompson would have succeeded is now a moot point. Incoming interim CEO Ross Levinsohn has an advertising background. Talk about a conundrum.
Here's the thing...
Just one day after he was forced to leave the forlorn Internet company for padding his resume, reports surfaced that ex-Yahoo CEO Scott Thompson revealed he has cancer.
According to a report in The Wall Street Journal, citing unnamed sources, Thompson told Yahoo's board and several colleagues of his thyroid cancer before resigning Sunday.
A source told The Journal that Thompson's decision to leave his position at Yahoo was in part influenced by his cancer diagnosis.
News broke last week that Thompson embellished his resume with a degree in computer science, when he actually earned a degree in accounting from a small Massachusetts college.
Thompson was hired in January to replace Carol Bartz, who was fired by phone last September.
In the revolving position at Yahoo, former head of global media Ross Levinsohn has been named interim CEO.
New CEO Boosts YHOOLevinsohn had a triumphant stretch running Internet services within Rupert Murdoch's media empire at News Corp. before Bartz lured him to Yahoo in 2010. Levinsohn previously ran ad sales for Yahoo's Americas unit.
Yahoo investors applauded the media veteran's appointment. Yahoo shares tacked on 2.2% in premarket trading Monday ahead of a nasty open for U.S. markets.
Levinsohn has significant credentials as a negotiator. Before coming aboard at Yahoo, he had a history of recognizing and acquiring an assortment of digital media companies around the globe. That is a striking comparison to Yahoo's last two CEOs, who had stronger backgrounds in technology than media.
"We view Mr. Levinsohn as well-equipped to lead the organization and to build off the company's core strengths - advertising products and digital media," said Spencer Wang, an analyst with Credit Suisse.
But Yahoo still faces a rocky road ahead.
Yahoo, once revered as a web pioneer, has been stunted and dwarfed by those who followed in its footsteps.
The storied Internet content company has been upset by an increasing number of competitors like search engine behemoth Google Inc. (Nasdaq: GOOG) and social networking giant Facebook Inc. (Nasdaq: FB), and been wounded by waning ad sales.
Yahoo also is very late to the game in the battle for the mobile space, currently the biggest area of growth for the industry.
And then there is the question of diminishing revenue, declining earnings and slumping stock price.
Revenue fell by more than a fifth last year. Yahoo's stock price has slipped 17% over the past year, and 50% over the past five.
"Yahoo just can't get its act together," Money Morning tech guru Michael A. Robinson warned in January, naming Yahoo a "tech stock to avoid" in 2012. "While key executives were napping, Google burst on the scene a decade ago and rewrote the rules of web search and advertising. Portals like Yahoo never regained their traction."
As Yahoo's struggles continued, CEO Carol Bartz was recently let go with a phone call in September. In January, former PayPal president Scott Thompson was brought in as Bartz's successor.
And now the latest replacement may soon be replaced himself.
After all, it wouldn't be the first time Google considered the deal.
In October, Google talked to at least two private-equity firms about helping them finance a deal to buy Yahoo Inc.'s core business, a person familiar with the matter told The Wall Street Journal.
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Thompson, most recently president of eBay Inc.'s (Nasdaq: EBAY) PayPal unit, is taking over the lead role. Yahoo is in dire need of new strategies to increase site traffic and attract advertisers if it hopes to defend against increasing competition from tech giants Google Inc. (Nasdaq: GOOG) and Facebook Inc.
Shareholders were frustrated with the decision, however, since they were pushing for the struggling Yahoo to sell.
"It's probably a slight negative because I think the best outcome for Yahoo would be an all out takeover by Microsoft," Brett Harriss, an analyst at Gabelli & Co., told Bloomberg News. "Hiring a new CEO makes the sale of the whole company unlikely."
Thompson is the company's fourth CEO in five years. Now the pressure's on him to win over shareholders and inspire investor confidence before the share price plunges.