Struggling dot-com company Yahoo! Inc. failed to impress analysts and investors as recent revenue forecasts fell below expectations. The dot-com company, which was once one of the largest online advertising firms in the world, reported sales of $1.06 billion in the current quarter, falling below analyst estimates of $1.12 billion.
Total sales during the second quarter of the year also fell below expectations, with a total of $1.07 earned on expectations of $1.08 billion. Yahoo’s key source of revenue, advertising, has struggled to sell as increased competition from firms such as Google and Facebook for display advertisers hurt the firm’s revenue base.
Yahoo has struggled to return to its former position of dominance in recent years, as firms such as Google and Facebook captured much of the online portal’s users. Once the Internet’s largest display advertising company, Yahoo’s per-quarter revenues of just $1.06 billion put it far behind online search advertising leader Google.
Despite its sluggish advertising performance, Yahoo has benefited from a series of high-profile acquisitions. The company acquired a stake in Chinese wholesale firm Alibaba in 2005 as part of a strategic partnership with Yahoo’s Chinese office. The exporting website has grown substantially along with Chinese manufacturing.
The company has been in the spotlight recently due to controversial policies put into place by new CEO Marissa Meyer. The CEO changed Yahoo’s policy on remote working, requiring thousands of mobile employees to change their roles and start commuting to Yahoo’s network of offices around the United States.
Other controversies involve Yahoo’s slipping advertising market share, which has sunk to just 7.9 percent from 9.2 percent in 2012. Rival display network Facebook posted a two percent increase in market share, while search firm Google benefited from a three percent gain, giving it 18 percent of the online display market.
