Yahoo Will Never Recover

http://247wallst.com/2009/06/21/why-yahoo-yhoo-will-never-recover/

by empone • 17 years ago

19 16 17 years ago

pierrefar• 17 years ago

Summary: Yahoo! doesn't have the profit margins nor the cash to be able to make aggressive maneuvers. Google and MS on the otherhand can.

Makes sense, but I won't go as far as saying Yahoo! will never recover, but it's certainly very difficult.

jobu• 17 years ago

This article is at least 5 years late. It's been ages since Yahoo! was on the top of anything. They appear to be following in the steps of Alta Vista.

encoderer4• 17 years ago

They're still on the top of the list of most trafficked websites...

tybris• 17 years ago

> Yahoo! has not developed any effective strategy to have any presence in the fast-growing social network sector.

Fast-growing in buzz, slow-growing in revenue.

csomar• 17 years ago

Yahoo! is just less useful, I think in the future people won't ue its mail system, search and hosting. Even the developer zone will be replaced by other growing third party services like nettuts.

Will never recover? May be if they start something new and small that can grow in the future!

lionhearted• 17 years ago

Interesting piece - reads correct, but I wouldn't count out a company with 3 billion in liquid reserves. Wow. Also, this set my Small Sample Size Alarm off some:

> Bing is off to a remarkably good start. Microsoft has historically had 8% to 9% of the US search market compared to Yahoo!’s 20% and Google’s 65%. Early results show Bing’s share surging as high as 13% of 14% in the three weeks after its introduction. [emphasis added]

Still, interesting read. I actually feel better about Yahoo after reading it - I didn't realize they had that much cash in the bank. That means that barring an epic screwup, they've got at least 5-10 years to develop a new big revenue source. I wouldn't count them out yet, but they do need to develop some new products that make cash.

graemep• 17 years ago

I was surprised by the amount of cash they have too.

Other than that, it is an entirely incompetent piece:

1) He appears to think that acquisitions can only be paid for with cash. 2) He does not explain why he thinks search is Yahoo's critical business: Carol Bartz does not seem to think it is. She may well be wrong, but he needs to explain why he thinks so. 3) MS may be willing to invest heavily in search, but throwing money at something does not guarantee results. 4) Yahoo can afford deals such as the one MS has made with Verizon - especially as the wording he quotes implies that the payments are being made over a period of years and are likely to be covered by the revenues it generates. If MS is willing to make unprofitable deals to gain share it will make Yahoo weaker in that market, but he gives no evidence of that. 5) Yahoo has huge amounts of traffic, and a lot of good products. Even the search engine is at least on par with Bing.

encoderer4• 17 years ago

You can't buy a company with stock as weak as Yahoo's lately without paying a disgusting premium.

I have no idea if the guy is right or wrong on his premise, but his analysis of their business isn't too far off from how I see it.

Gibbon• 17 years ago

Biased much?

Yahoo's so called "razor thin margins" exceed the historic norm for large corporations by nearly 50%.

Any comparison to a company that has yet to (or ever will) make a profit is irrelevant.

Dilpil• 17 years ago

Is there a financial news site that gets high tech? Everything here seems perfectly reasonable if your talking about a company making widgets and doodads, but not so much for intangible computing based products.

fossguy• 17 years ago

I heard the same thing in the past about Nintendo and Apple... They are dying, will never come back, etc.

Not saying that Yahoo will recover, but you never know.

TweedHeads2• 17 years ago

How to detect propaganda:

- Powerful words for those who just skim front page headlines

- Referencing stocks at lowest $9 when right now they are in a healthy $15.

- Words like mistakes, doomed, failure, layoffs

I know I will lose some karma here, but this kind of FUD shouldn't be tolerated here in HN.

We should know better how to detect it and how to eradicate this pest from news sites.

encoderer4• 17 years ago

$15 is healthy compared to $9 but not when compared to the $30-40 range that I, as a Yahoo shareholder, would've been paid a year ago.

TweedHeads2• 17 years ago

Yahoo stock was over $100 in the year 2000. Did shareholders ask to sell the company then?

The DOW was above 12K last year.

The DOW right now is around 8K.

Nobody foresaw the economic recession.

If your opinion can be so easily manipulated by throwing numbers out of context then I can not be of any help.

As a shareholder you should know that.

stse• 17 years ago

I think one of the cooler things coming out of yahoo was the "Yslow" best practices. But the guy in charge of that left for google around late 2007, early 2008. From what I've read they seem to have "lost" a lot of other people too.

Yahoo Will Never Recover

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