Yahoo! earnings meet expectations, but issues 2001 warning

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Leading Web portal Yahoo! Jan. 10 met Wall Street's estimates when it announced pro forma earnings of $80.2 million in the latest quarter, compared with $55.7 million from the same quarter a year earlier. For the fourth quarter ended Dec. 31, 2000, it reported net revenue of $310.8 million, up 53 percent from the same quarter in 1999. Yahoo!, which generates most of its revenue from advertising on its site, is trying to reach an "alignment" with its dot-com advertisers, which have caused the softening in the online advertising market. It said it expects between 80 percent and 85 percent of its clients to be traditional marketers by the end of 2001, compared with 75 percent to 85 percent currently.

The portal made a few projections, saying it expects 2001 revenue to be between $1.2 billion and $1.3 billion, missing some analysts' projections of $1.4 billion.

Tim Koogle, chairman and CEO, stressed Yahoo! was going through a short-term economic downturn, which it would use to expand its market share. He also said Yahoo! would undertake several initiatives to increase its revenue source, including expanding its ad sales channel, maintain free ad-supported services and add more subscription premium services.

Copyright January 2001, Crain Communications Inc.

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