"And AT&T's bet was many, many times larger." "They hope to succeed at a time when Verizon has already admitted failure," he said. Moffett said AT&T should pay close attention to Verizon's troubles. Telecom companies are looking for alternate sources of revenue to grow in a world where most Americans already have cellphones. The biggest example is AT&T acquiring Time Warner earlier this year for $81 billion. In recent years, telecom companies have been acquiring producers of entertainment, news and other content to compete with tech giants such as Amazon, Google and Facebook. "The best one can say is that it was a relatively modest investment for a company of Verizon's size." "They tried to create an alternative revenue stream for wireless, but they have ultimately found it too hard to make advertising into what they had originally hoped," he said. The write-down "puts a period at the end of a short and inconsequential sentence," said Craig Moffett, an analyst at MoffettNathanson. The company blamed weak revenue and earnings from the two businesses, known jointly as Oath, and said the benefits from integrating Yahoo and AOL were less than expected. Now, Verizon is slicing the value of those two businesses in half, taking a $4.6 billion accounting write-down in the fourth quarter. The share-tending entity, to be renamed Altaba, Inc., will act as an investment company.The wireless company spent more than $4 billion to buy AOL and nearly $5 billion to buy Yahoo as part of an effort to compete with Facebook and Google in a growing market for digital advertising. Yahoo is selling its main operating business as a way to separate that from its more valuable stake in Chinese internet giant Alibaba. Mayer will quit the company’s board after its merger with Verizon, according to an SEC filing, though she is expected to remain with the core Yahoo business. Yahoo shares were up a little more than one percent to $42.88 in after-market trades that followed release of the earnings figures, which topped Wall Street expectations. “I’m very pleased with our Q4 results and incredibly proud of the team’s execution on our 2016 strategic plan, particularly given the uniquely eventful past year for Yahoo,” Mayer said. Mavens revenue for last year slightly topped $2 billion as compared to $1.7 billion in 2015. Mayer has been driving a shift to mobile, video, social and native advertising offerings at Yahoo, and revenue in those areas - which she dubbed “Mavens,” continued to climb. Yahoo reported a loss of $214 million for the full year on revenue that inched up to $5.2 billion from $5 billion in 2015, according to the earnings report. Revenue in the fourth quarter rose to $1.47 billion from $1.27 billion a year earlier. The earnings report showed Yahoo swung to profit a year after a massive $4.4 billion loss in the same period a year earlier, resulting from a large writedown on the value of its holdings. “I think the merger is at risk the delay would point to that as still a possibility.” “The bigger things are the breaches those have Verizon reconsidering the deal,” analyst Rob Enderle of Enderle Group told AFP. When companies are in the process of being acquired, earnings that hit or surpass targets typically don’t knock matters off course. The cyber attacks, and how notifying users was handled, has also raised concerns by investors that Verizon may seek to pay a lower price for Yahoo or even back out of the deal. The data breaches have been a major embarrassment for a former internet leader that has failed to keep up with Google, Facebook and other rising stars. The SEC’s investigation is focusing on why it took Yahoo several years to reveal the 20 attacks. It admitted another cyber attack in December, this one dating from 2013, affecting more than a billion users. Yahoo announced in September that hackers in 2014 stole personal data from more than 500 million of its user accounts. US law requires companies that fall victim to such hacks to disclose them as soon as they are deemed to affect stock prices. The US Securities and Exchange Commission has opened an investigation into whether Yahoo should have informed investors sooner about two major data breaches, The Wall Street Journal reported Sunday, citing people familiar with the matter.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |