UPDATE: The relief over the Alibaba news didn’t last long. Yahoo shares are now down 2.4% following management’s call with analysts who mostly focused on the company’s lousy Q2 results — and execs ratcheted back their Q3 guidance. CEO Marissa Mayer said it will take “multiple years” to turn things around, although she called the Q2 numbers a “short term set back.” CFO Ken Goldman says that “clear we need to operate with a greater sense of urgency” as he projected that Q3 numbers will look a lot like Q2’s.

PREVIOUS, 1:16 PM: Yahoo only has to sell 140M of its Alibaba shares after the Chinese e-retailer goes public, down from their previous agreement that required Yahoo to unload 208M shares. That led to a 2.5% jump in Yahoo’s stock price in early post market trading — not bad considering what looks at first glance to be tepid financial results in Q2. Yahoo generated $272.6M in net income, -18.6% vs the period last year, on revenues of $1.04B (not including traffic acquisition costs), -2.9%. The top line is a hair lower than analysts expected. Net earnings at 37 cents a share were a penny light of the consensus forecast.

The Q2 results will do little to assuage investors who are wondering when CEO Marissa Mayer — who’s been at the company for two years — will show solid improvements at Yahoo’s core ad-supported businesses. The stock is down nearly 12% so far in 2014 as people lose patience, and fear what will happen now that it has to reduce its 24% stake in Alibaba, which is seen as a success.

That’s why investors are pleased that Yahoo now only has to sell 6.4% of its stake in the company when it goes public, expected later this year. Yahoo is “committed to return at least half of the after-tax IPO proceeds to shareholders,” CFO Ken Goldman says.

Mayer says that she’s “not satisfied with our Q2 results” — especially in display ads. Revenue from the business (not including traffic acquisition costs) fell 7% to $394M. A 24% drop in the price-per-ad outweighed the 24% increase in the number of ads sold.

Search advertising (again, without TAC) increased 6% to $428M. Paid clicks were up 3% while the price-per-click was up 15%.

“I believe we can and will do better moving forward,” Mayer adds. “Overall I remain confident in Yahoo’s future, our strategy, and our return to long-term growth.”