Yahoo! (YHOO) Tops Q3 EPS by 6c; Mobile Revenue Rose 46%

October 18, 2016 4:07 PM EDT

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Yahoo! (NASDAQ: YHOO) reported Q3 EPS of $0.20, $0.06 better than the analyst estimate of $0.14. Revenue for the quarter came in at $1.23 billion versus the consensus estimate of $1.31 billion.

Mobile Revenue*:

Q3 2015 Q3 2016
Mobile revenue $ 271 million $ 396 million
Desktop revenue 844 million 854 million
Total traffic-driven revenue $1,115 million $1,250 million
Non-traffic-driven revenue 111 million 55 million
GAAP revenue $1,226 million $1,305 million

* The Change in Revenue Presentation contributed $127 million to mobile revenue, $131 million to desktop revenue, and $258 million to traffic-driven revenue in the third quarter of 2016.

GAAP mobile revenue for the third quarter of 2015 and 2016 was $271 million and $396 million, respectively.

Mobile revenue represented 24 percent and 32 percent of traffic-driven revenue in the third quarter of 2015 and 2016, respectively. Excluding the impact of the Change in Revenue Presentation, mobile revenue would have been $269 million and represented 27 percent of traffic-driven revenue in the third quarter of 2016.

Gross mobile revenue for the third quarter of 2015 and 2016 was $424 million and $432 million, respectively. The Change in Revenue Presentation does not impact gross mobile revenue.

Search Revenue:

  • GAAP search revenue was $703 million for the third quarter of 2016 compared to $516 million for the third quarter of 2015. Excluding the impact of the Change in Revenue Presentation, which contributed $258 million to search revenue in the third quarter of 2016, search revenue decreased by 14 percent compared to the third quarter of 2015.
  • Gross search revenue was $752 million for the third quarter of 2016, a decrease of 14 percent compared to the third quarter of 2015. The Change in Revenue Presentation does not impact gross search revenue.
  • Cost of revenue - TAC associated with search revenue was $384 million for the third quarter of 2016. Excluding the impact of the Change in Revenue Presentation, which contributed $258 million to cost of revenue - TAC in the third quarter of 2016, cost of revenue – TAC associated with search revenue increased by 6 percent compared to the third quarter of 2015.
  • The number of Paid Clicks decreased 22 percent compared to the third quarter of 2015.
  • Price-per-Click increased 9 percent compared to the third quarter of 2015.

Display Revenue:

  • GAAP display revenue was $476 million for the third quarter of 2016, a 7 percent decrease compared to the third quarter of 2015.
  • Cost of revenue - TAC associated with display revenue was $63 million for the third quarter of 2016, a 39 percent decrease compared to the third quarter of 2015.
  • The number of Ads Sold decreased 5 percent compared to the third quarter of 2015.
  • Price-per-Ad increased 1 percent compared to the third quarter of 2015.

GUIDANCE:

Yahoo! sees Q4 2016 revenue of $1.36-1.40 billion, versus the consensus of $1.37 billion.

Yahoo! sees FY2016 revenue of $5.06-5.10 billion, versus the consensus of $5.06 billion.

For earnings history and earnings-related data on Yahoo! (YHOO) click here.



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