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Computer Technology

Yahoo May Be A Web Pioneer That Has Failed To Reinvent Itself In The Smartphone Age

Yahoo office

Yahoo’s Future Doesn’t Look Too Promising

For the last decade, Yahoo has struggled to find its reason for being. Under the leadership of Marissa Mayer, a highly vaunted Google executive brought in a couple years ago to drive Yahoo’s latest turnaround effort, the company has spent billions of dollars on acquisitions like Tumblr and Polyvore that have yet to prove their value. And in October 2015, Yahoo announced it was writing off $42 million that it had wasted on an ill-fated foray into original video programming.

Though Yahoo has been suffering through various financial troubles for some time, the past few months have been especially tough. According to a December 10, 2015, Nasdaq article, Yahoo’s board of directors have decided to sell off Yahoo’s core internet assets, including Yahoo mail, Yahoo search, and the Yahoo homepage — a value estimated to be $2 to $4 billion. However, it seems potential buyers are not flocking to Yahoo’s doors, in particular since any takeover would include serious tax implications.

Brian Wieser, an analyst at Pivotal Research, noted recently:

The saving grace for Yahoo is that it still has a relatively large user base that is reliant on the platform so long as they maintain email addresses there. It also has a still relatively strong (and still relatively large) sales force. As long as both of those factors remain in place, there would be time for an acquirer to establish new strategies and develop products while the property continues to generate cash flow.

Yahoo’s troubles are continuing in 2016. On January 6, Business Insider carried a report from Reuters that Yahoo will be cutting at least 10% of its workforce. Then, just a few days ago, the Silicon Valley Business Journal had more discouraging news about Yahoo in an in-depth report titled, More Calls for Yahoo to Stop Burning Cash, Sell Core Business.


A look at Yahoo in its heyday…

Yahoo heyday graph


A look at how some key tech stocks have vaulted past Yahoo…

Yahoo in the dust

 

 

About Gary Reiner

thinking, reading, and writing about whatever's going on in the world...

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