Even though Yahoo! reported third-quarter earnings that exceeded expectations, it wasn't enough to calm investors' jitters about the future of the Internet portal. Yahoo! shares dropped 21% Oct. 11, to close at $65.38. Investors continued to question the ability of the company to transition from its existing business model of deriving revenue from advertising from other dot-coms to one that pulls more business from large offline established companies. Yahoo! is under pressure to attract more offline businesses; the company said it reduced its reliance on pure-play dot-coms to 40% from 47% in the second quarter.
Copyright October 2000, Crain Communications Inc.