Yahoo CEO Marissa Mayer had a blunt opening line in Tuesday’s Q2 2014 earnings release:
Our top priority is revenue growth and by that measure, we are not satisfied with our Q2 results. While several areas showed strength, their growth was offset by declines. Yahoo Search, for example, had a strong quarter, growing 6% year-over-year on a revenue ex-TAC basis and 19% year-over-year in search click-driven revenue. Our social, mobile, video and native areas also grew with significant momentum, collectively gaining nearly 90% year-over-year. However, display remains an area of investment and transition. In Q2, we saw display revenue decline, further highlighting the fact that we need to work faster to ameliorate the negative trends. I believe we can and will do better moving forward. Overall, I remain confident in Yahoo’s future, our strategy, and our return to long-term growth.
Yahoo missed earnings expectations, but the stock was still up in after-hours tradings because the company owns a large portion of Chinese ecommerce company Alibaba, which is about to IPO.