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Search Advertising Boosts Yahoo Performance, Will Ask Jeeves Follow?

Search Advertising Boosts Yahoo Performance, Will Ask Jeeves Follow?

Last night Yahoo, the online search, content and community giant, posted first quarter reports that were astonishing. According to the Yahoo performance reports, Yahoo earned $101 million, or 14 cents a share, compared with $47 million, or 8 cents, a year ago.

The driving force behind such a strong financial showing by Yahoo was search engine advertising. Last year Yahoo purchased Overture, the pioneer of paid search sponsored link advertising. Besides profiting from base Overture earnings, Yahoo has also successfully integrated Overture Contextual keyword advertisements into many parts of the Yahoo portal; including Sports, Shopping, and Yahoo Groups.

Yahoo also launched their own search engine last quarter, dumping Google as the source of Yahoo search results. The new search technology uses a hybrid paid inclusion/pay-per-click system dubbed Overture SiteMatch, which is believed to also have helped with the first quarter earnings which nearly doubled to $550 million for its first quarter ended March 31.

Such earnings potential for 2004 will put Yahoo well over the 2003 benchmark when their global online advertising revenues, at $1.2 billion, represented 12.8% of worldwide online advertising revenues. After just one quarter in 2003, Yahoo is at half of last year’s earning level already.

Another publicly traded search engine player which made big news in the first quarter of 2004 was Ask Jeeves. Jeeves and Co. surprised a large part of the search market by gobbling up Interactive Search Holdings Inc. for about $328 million.

The Ask Jeeves acquisition of Interactive Search Holdings opened the Ask Jeeves umbrella over their new BIG and branded properties- iWon, Excite and My Search. The acquisition of iWon, Excite and MySearch essentially doubled the Ask Jeeves’ market share to 7 percent of the search engine industry (figure from CNN). Between all of its brands, Interactive Search had 700 million searches in the fourth quarter of 2003- 20 million more than the 680 million searches that Ask Jeeves pulled in over the same time span.

Among the hype, Ask Jeeves will announce its first quarter 2004 financial results on Tuesday, April 20, 2004. The search engine community will be listening.

Category SEO
SEJ STAFF Loren Baker Founder at Foundation Digital

Loren Baker is the Founder of SEJ, an Advisor at Alpha Brand Media and runs Foundation Digital, a digital marketing ...

Search Advertising Boosts Yahoo Performance, Will Ask Jeeves Follow?

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