Yahoo (YHOO) Whipsawed After-hours as Investors Analyze Q4 Results, Outlook

January 28, 2013 5:20 PM EST
Shares of Yahoo, Inc. (NASDAQ: YHOO) were volatile in after-hours trading on Monday following the company’s Q4 earnings report. The report showed Yahoo grew revenue for the first time in 4 years, while bottom line results beat analysts' views.

In comments CEO Marissa Mayer stressed the company progress made in transforming Yahoo's culture, energy and execution. She also said “I'm proud of Yahoo!'s 2012 and fourth quarter results”. Investors overlooked the touchy-feely comments and focused on the data.

GAAP revenue for the quarter grew 2 percent year over year to $1.35 billion. Revenue excluding traffic acquisition costs (TAC) was $1.22 billion compared to estimates of $1.21 billion. Ex-TAC display revenue declined 5 percent year-over-year, which was offset by a 14 percent increase in search.

On the earnings front, Yahoo reported Q4 EPS of $0.32, $0.04 better than the analyst estimate of $0.28. This was driven in part by an increase in ad costs and price-per-click compared to last year.

In after-hours trading, shares of Yahoo initially climbed in response to the results, but bulls could not hold onto gains as FY mid-point revenue guidance fell short. Yahoo sees Q1 revenues ex-TAC of $1.07-$1.1 billion versus the consensus of $1.12 billion. Yahoo sees FY2013 revenues ex-TAC of $4.5 to $4.6 billion vs $4.59 billion expected.

Shares of Yahoo last traded up 1.7% to $20.66.

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