Yahoo beat Wall Street’s financial estimates for the last three months of 2016 — but, more importantly, it says that the planned sale to Verizon is on track, although it will close later than expected.
The internet company says that it’s “working expeditiously to close the transaction as soon as practicable in Q2,” back from its original plan to wrap up the $4.8 billion deal by the end of March.
Yahoo shares are up about 1% in post market trading.
As for Q4, Yahoo says it generated $162 million in net earnings — up from $4.43 billion loss in the period a year ago, which included a $4.46 billion impairment charge — on $1.47 billion in revenues, up 15%.
The top line beat the Street’s expectations for $1.38 billion. Adjusted earnings, at 25 cents a share, topped predictions for 21 cents.
“With our 2016 and Q4 financial results ahead of plan, and the continued stability in our user engagement trends, the opportunities ahead with Verizon look bright,” CEO Marissa Mayer says.
She indirectly addressed Yahoo’s disclosures that its services had been hacked over the last few years. The internet company said in December that an “unauthorized third party” stole information from more than 1 billion accounts in 2013. In September, it disclosed that 500 million accounts had been hacked in 2014.
“In addition to integration planning, our top priority continues to be enhancing security for our users,” Mayer says. “With security protocols and password changes in place, approximately 90% of our daily active users have already taken or do not need to take remedial action to protect their accounts, and we’re aggressively continuing to drive this number up. Our commitment to our users is unwavering, and we continue to be encouraged by their loyalty to us and their ongoing patronage of our products.”
Not including traffic acquisition costs, search revenues fell 14% to $333.8 million with the number of paid clicks down 21% while revenue per click rose 18%.
Display ad sales, not including traffic acquisition costs, increased 5% to $496.7 million. The number of ads sold increased 4% but the price per ad fell 10%.