Yahoo Revenue Tops $1 Billion Due to Paid Search Advertising
Yahoo announced on Tuesday its quarterly profit doubled on paid search advertising growth and Yahoo issued a healthy forecast for the current quarter, boosting shares as the market opens. Paid subscriptions at Yahoo also boosted revenue bringing in $148.9 million. Page views hit the roof with over 100 billion page views in March alone.
Topping most forecasts, Yahoo’s first-quarter revenue escalated to $1.17 billion, which was up 55 percent from $757.8 million in the first quarter of 2004. It is the first time in Yahoo’s history that quarterly revenue exceeded $1 billion. After all of the numbers were crunched, Yahoo posted net income of $205 million, or 14 cents a share, in the first quarter, up from $101 million, or 7 cents a share, a year earlier.
Yahoo is engaged in an intense battle for advertising dollars with Google, the Mountain View search engine. Google, which reports first-quarter earnings Thursday, has also prospered, largely because of text ads that appear next to search results.
Yahoo’s other business category, fees, accounted for $148.9 million in revenue. The category includes subscriptions for fantasy sports leagues, online dating and broadband Internet access in conjunction with several telecommunication companies. In all, Yahoo had 8.9 million paid subscriptions as of March 31.
“Yahoo is off to a terrific start in 2005,” said CEO Terry Semel. He underscored the company’s strategy to offer more features on its Web portal to get users to view more pages and thereby generate more advertising revenue. Yahoo’s users visited 100 billion pages on the portal in March.
Yahoo deepened its offering during the quarter. Among the highlights were the acquisition of photo-sharing service Flickr, the premiere of a test version of Yahoo’s social networking and blog service Yahoo 360, and new features for mobile telephones.