Yahoo! Reports Third Quarter 2001 Financial Results
Company Posts $166.1 Million in Revenue and $8.4 Million in Pro Forma Net Income
SUNNYVALE, Calif.--(BUSINESS WIRE)--Oct. 10, 2001--Yahoo! Inc. (Nasdaq:YHOO - news) today reported net revenues totaling $166.1 million for the third quarter ended September 30, 2001, compared to net revenues of $295.5 million for the third quarter ended September 30, 2000. Pro forma net income for the quarter ended September 30, 2001 was $8.4 million or $0.01 per share diluted(1). This compares to pro forma net income of $81.1 million or $0.13 per share diluted for the comparable period in the previous year(1). The actual net loss for the third quarter ended September 30, 2001, which includes net investment losses of $17.9 million, was $24.1 million or $0.04 per share diluted, compared to actual net income of $47.7 million or $0.08 per share diluted reported in the comparable period of the previous year.
During the quarter, Yahoo!'s strong consumer metrics underscored the company's leadership position among online consumers. Yahoo!'s global network continues to be No. 1 worldwide in terms of unique users, reach, and time spent (Nielsen//NetRatings, August 2001). Yahoo!'s global audience grew to 210 million unique users, compared to 166 million in September 2000. In addition, a record 80 million active registered members logged onto Yahoo!® during September 2001. The company's traffic increased to a record 1.25 billion page views per day on average during September 2001.
``In the five months since I joined Yahoo!, we have been building upon Yahoo!'s already solid foundation and we are continuing on our path of evolutionary change. We remain focused on opportunities that will strengthen our leadership position, provide essential services to our users and partners, and drive profitable growth,'' said Terry Semel, Yahoo!'s chairman and CEO. ``While we find ourselves in an unprecedented environment of economic uncertainty, the recent tragic events in the United States have proven that the Internet is a highly valuable global communications and information delivery medium. Although there is limited visibility into the future, Yahoo! intends to manage through this period and emerge from it an even stronger leader.''
``Yahoo!'s global audience of active, loyal consumers continues to grow, strengthening our position as the leading Internet destination and the partner of choice for marketers and businesses,'' said Jeff Mallett, Yahoo!'s president and chief operating officer. ``We will continue to leverage Yahoo!'s powerful global franchise to maximize the growth opportunities in our key businesses of marketing services, business and enterprise services and consumer services.''
Management Update
As part of Yahoo!'s commitment to attract and retain experienced industry leaders, the company recently announced three key new additions to the senior management team. Yahoo! appointed Wenda Harris Millard as chief advertising sales officer, responsible for driving the North American sales of the company's advertising and marketing services initiatives and leading the North American sales organization. James A. Fanella was named senior vice president of business and enterprise services, and is leading the development and business strategies for Yahoo!'s services that target enterprise customers, including Corporate Yahoo! and Yahoo! Broadcast Services. Additionally, Yahoo! named Elizabeth Sartain as senior vice president of human resources, overseeing the company's global human resources efforts.
``The top-notch leaders we have recently hired solidify our experienced senior-level management team and positions Yahoo! for future growth,'' added Semel. ``These seasoned professionals will continue to enhance the quality of both our advertising and business services sales organizations and sustain our increased focus on providing clients with essential solutions to suit their varied needs.''
Company's Business Outlook
``Through fiscal discipline, Yahoo! delivered on our revenue and profitability projections in the third quarter while managing through a challenging economic environment,'' said Susan Decker, Yahoo!'s chief financial officer. ``We remain focused on building strong customer relationships which facilitate a higher quality revenue mix in addition to identifying and investing in areas that will drive long-term, profitable growth.''
Based on current information, the company expects revenues for the fourth quarter 2001 to be between $160 and $180 million, thereby implying a range of $688 to $708 million for the full year 2001. By business segment, the company expects revenues from business and premium services to represent approximately 20% of total revenue in the fourth quarter and approaching 20% for the full year 2001, with marketing services and commerce accounting for the remainder.
In the fourth quarter 2001, Yahoo! expects pro forma earnings before interest, depreciation and amortization (EBITDA) to range from a $5 million loss to a $10 million profit and pro forma earnings per share (EPS) to be approximately breakeven to $0.01. For the full year 2001, pro forma EBITDA is expected to be between $10 million to $25 million and pro forma EPS in the range of $0.04 to $0.06.
The company expects capital expenditures to be approximately $15 to $20 million in the fourth quarter 2001 and approximately $85 million to $90 million for the full year 2001. Charges related to amortization are expected to be approximately $17 million in the fourth quarter and $60 million for the full 2001 year. Yahoo! also expects depreciation to be approximately $18 million in the fourth quarter and $67 million for fiscal year 2001. The pro forma tax rate for the company is expected to be 48 percent for the full year 2001.
The Business Outlook for the company will be available on the company's Investor Relations Web site throughout the current quarter. It is currently expected the full Business Outlook will not be updated until the release of Yahoo!'s next quarterly earnings announcement; however, Yahoo! reserves the right to update the full Business Outlook or any portion thereof at any time for any reason.
Quarterly Conference Call
Yahoo! will host a conference call today to discuss third quarter results at 5:00 p.m. Eastern Time. A live Webcast of the conference call can be accessed at webevents.broadcast.com. In addition, a replay of the call will be available for 48 hours following the conference call and can be accessed through the ``Conference Calls'' area of the company's Investor Relations Web site at www.yahoo.com/info/investor, or by calling (800) 633-8284, reservation No. 16498858.
About Yahoo!
Yahoo! Inc. is a leading global Internet communications, commerce and media company that offers a comprehensive branded network of services to more than 210 million individuals each month worldwide. As the first online navigational guide to the Web, www.yahoo.com is the leading guide in terms of traffic, advertising, household and business user reach. Yahoo! is the No. 1 Internet brand globally and reaches the largest audience worldwide. The company also provides online business and enterprise services designed to enhance the productivity and Web presence of Yahoo!'s clients. These services include Corporate Yahoo!, a popular customized enterprise portal solution; audio and video streaming; store hosting and management; and Web site tools and services. The company's global Web network includes 24 World properties. Headquartered in Sunnyvale, Calif., Yahoo! has offices in Europe, Asia, Latin America, Australia, Canada and the United States.
This press release and its attachments contain forward-looking statements that involve risks and uncertainties concerning Yahoo!'s expected financial performance (as described without limitation in the Business Outlook section and quotations from management in this press release), as well as Yahoo!'s strategic and operational plans. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of future performance. The potential risks and uncertainties include, among others, the slower spending environment for advertising sales; the actual increases in demand by customers for Yahoo!'s premium and corporate services; the ability to successfully change the customer mix among Yahoo!'s advertising customers; general economic conditions (including the effects of the terrorist attacks on the United States on September 11, 2001 and related events); the ability to adjust to changes in personnel, including management changes; and the dependence on third parties for technology, content and distribution. All information set forth in this release and its attachments is as of October 10, 2001, and Yahoo! undertakes no duty to update this information. More information about potential factors that could affect the company's business and financial results is included in the company's Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2000 and Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2001, including (without limitation) under the captions, ``Risk Factors'' and ``Management's Discussion and Analysis of Financial Condition and Results of Operations,'' which are on file with the Securities and Exchange Commission (the ``SEC'') and available at the SEC's website at www.sec.gov. Additional information will also be set forth in those sections in Yahoo!'s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2001 which will be filed with the SEC in the near future.
(1) Pro forma net income and net income per share calculations for all 2001 and 2000 periods exclude acquisition-related and restructuring charges, amortization of intangibles and stock compensation, employer payroll taxes on gains realized by employees from non-qualified stock option exercises, investment gains and losses, and income related to a contract termination fee.
Note to Editors: Yahoo!, Corporate Yahoo!, and the Yahoo! logos are trademarks and/or registered trademarks of Yahoo! Inc. All other names are trademarks and/or registered trademarks of their respective owners. |
