New Chief Executive Carol Bartz Tuesday ruled out wholesale dismemberment of Yahoo as the company swung to a fourth quarter loss after taking goodwill impairment and other charges.
In after-hours trading, Yahoo shares tacked on $.17, or 1.5 percent, to $11.34, as investors cheered the first major performance of Ms. Bartz, who joined the company eight days ago, in the earnings conference call.
Declining to directly address persistent rumors of deals involving Time Warner’s AOL unit and Microsoft, Ms. Bartz stressed the value of Yahoo’s search business and the need to “get value” if any transaction were consummated.
Yahoo reported a net loss of $303 million, or $.22 per diluted share compared to net income of $206 million, or $.15 per diluted share in the year-ago period. Weighing on the latest quarter’s results, however, were goodwill impairment charges of $488 million related to Yahoo’s European operations, charges of $108 million for severance and other restructuring costs and a $7 million charge for advisors tied to Microsoft’s failed 2008 bid to acquire the company, a proxy fight and related issues.
Citing the economic downturn, Yahoo declined to offer full-year guidance, but projected first quarter revenue of $1.525 billion to $1.725 billion.
At the outset of the conference call, Ms. Bartz said she did not take the Yahoo job in order to flip the company.
“Did I come to Yahoo to sell the company? The answer is: No,” she said. She also tweaked Microsoft, whose Chief Executive Steve Ballmer has expressed continued interest in a deal involving Yahoo’s search unit. Yahoo’s search business, Ms. Bartz noted, remains almost three times as large as "the number of the No. 3 player,” Microsoft.
When a Wall Street analyst, who suggested Yahoo buy The New York Times company, inquired about strategic initiatives, Ms. Bartz took a sarcastic turn.
“I thought I’d buy The New York Times tomorrow,” she said breezily. “Just kidding.”
Ms. Bartz did leave open the door for selling off some of Yahoo’s broad portfolio of Internet businesses to achieve better focus. Analysts have speculated that Yahoo might sell its stake in Asian Internet properties, including Alibaba.com, which are valued at $6.50 per Yahoo share.