NEW YORK (AdAge.com) -- Newly minted Yahoo CEO Carol Bartz has officially been in the job less than two weeks, but she said she did not come to the company to sell it, and added the company shouldn't "be pulled apart and left for the chickens."
Specifically, she said the company would continue to invest in search, but would look at options "to get the best value out of it if we decide to sell."
It was Ms. Bartz's first earnings call at the helm of the company, and despite worsening management turmoil over the past year and the difficult economic environment, Yahoo faired better than many analyst had expected.
Profit down, revenue flat
The company swung to a loss in the fourth quarter due to a charge stemming from the 1,500 staff cuts and bad investments. The company recorded a net loss of $303 million, including a $600 million one-time charge, compared with a profit of $206 million in the fourth quarter of 2007.
Revenue was basically flat, down 1% to $1.805 billion from $1.832 billion a year ago. Advertising revenue for the quarter also was flat at $1.59 billion with the year-ago period, a sign Yahoo is weathering the recession reasonably well so far.
Things are going to get tougher before they get better. Yahoo predicted first-quarter revenue would be down 10% from a year ago. But given the state of the economy, Wall Street seemed encouraged by the results, and Yahoo shares rose 5% in after-hours trading.
Ms. Bartz, former chairman-CEO of Autodesk, was named to replace co-founder Jerry Yang as CEO less than two weeks ago, and has had little time to put her stamp on the company. She understandably told analysts she believes Yahoo, which has seen its display-ad business erode and is a distant No. 2 in search to Google, has plenty of potential, but it was early to say what her strategy would be to turn the portal around.
On the call, Ms. Bartz burnished her reputation as a folksy straight-talker. She took a question from Piper Jaffray analyst Gene Munster, who had earlier opined that Yahoo should buy The New York Times and Gawker Media. "Well, Gene, I thought I would buy The New York Times tomorrow. I'm just kidding. Hi, Gene!" she said.
While not giving specifics, Ms. Bartz said she believes the company has a strong set of assets that can work well together.
"This is a fantastic internet property, and it really doesn't deserve everyone trying to pick and pull it apart," she said. "This is not a company that needs to be pulled apart and left for the chickens."
Among the questions she couldn't answer was whether Yahoo would continue its battle against Google in search, or sell or pursue a joint venture with Microsoft, which has the No. 3 search engine. Yahoo spurned a generous takeout offer from Microsoft and spent much of the year trying to consummate a search deal with Google, but both parties abandoned the effort late last year when it became clear it was opposed by advertisers and federal regulators.
"Search is a very valuable part of our business," she said. "Understanding the intent and goals of our users as they seek information online is extremely useful to our franchise in many ways."
While Yahoo turned in generally encouraging results, a survey by Advertiser Perceptions, which polls marketers and agencies about their marketing plans, showed that the company has reason to fear it could lose its display-ad dominance to Google.
Google, which has fought to gain display-ad market share, has made inroads with advertisers, which tell Advertiser Perceptions that they believe the company has matched Yahoo in its ability to deliver results from display campaigns.
"When it comes to what's most important to online-display advertisers, perceptions of Yahoo remain strong," said Advertiser Perceptions CEO Ken Pearl. "What's surprising is how well Google's display efforts have succeeded in creating equally strong perceptions on Yahoo's turf."
Encouragement for Bartz
One marketer was encouraged that Ms. Bartz seemed to appreciate the need to keep the company together.
"They need to keep their search business," said Steve Kerho, VP-analytics at Omnicom Group interactive shop Organic. "When you look at how people use media online, it's both search and display; their ability to provide marketing solutions will be hampered if they have to outsource part of it to someone else."