Yahoo! Projects Doubling Of Cash Flow In 3 Years

Yahoo! has released an investor presentation that outlines the company's long-term financial plan. According to their press release, this financial plan was generated before Yahoo! received a hostile takeover bid from Microsoft. You'll forgive me if I have my doubts about that. Because unless Yahoo! cures cancer or has a secret unicorn farm somewhere, I can't see how this projection of revenues is anything but wishful thinking. Wishing for a higher bid from Microsoft, that is.

The presentation supports the unanimous determination by the Company's board of directors that Microsoft's January 31, 2008 unsolicited acquisition proposal substantially undervalues Yahoo!. The board cited Yahoo!'s global brand, large worldwide audience, significant recent investments in advertising platforms and future growth prospects, free cash flow and earnings potential, as well as its substantial unconsolidated investments, as factors in its decision. Yahoo!'s board of directors is continuing to evaluate all of its strategic alternatives to maximize value for Yahoo! stockholders.

Yahoo!'s management today also reaffirmed its outlook for the first quarter 2008 and full year 2008, as previously provided on January 29, 2008.

Key sources of projected growth in revenue and operating cash flow cited in the presentation include $1.9 billion in added revenue ex-TAC over the next three years from display/video advertising, as Yahoo! expects its growth to outpace the currently anticipated market rate of growth in online display/video advertising. The Company also expects $1.4 billion in added search revenue, implying growth essentially in line with the anticipated market rate of growth in search advertising.

"Yahoo! is positioned for accelerated financial growth - we have a powerful consumer brand, a huge global audience and a highly profitable operating model," said Jerry Yang, the Company's co-founder and chief executive officer. "With industry-leading tools, technology, people and platforms, Yahoo! is poised to capture growth in display advertising where we believe growth will be greatest. Combined with our recent progress in search monetization, Yahoo! is well positioned to provide the broadest range of products to our advertisers while delivering the most compelling experiences to users."

I have selfish reasons for wanting Microsoft to purchase Yahoo!. I know that if Microsoft's bid is accepted, boring old Microsoft will make Yahoo! drop the ridiculous exclamation point at the end of their name, and I won't have to type it any more, or try to figure out if you put a period after the exclamation point at the end of a sentence. And maybe I won't have to read press releases typed in light purple text any longer, either. At least there was no sparkle.
Tags:  Yahoo, ECT, cash, flo, pro, EA, AR, project
Comments
frg1 6 years ago

 yahoo must have a pretty high opinion of its self if it thinks it can do that in three years

ice91785 6 years ago

Yeah i don't think this is very feasible either -- those are some high numbers. Perhaps if yahoo's homepage had a single textbox for searching and tons of adds surrounding this one text box.................wait Huh? it already does

frg1 6 years ago

even if microsoft accuired them how much good would it really do look at msn what makes it stand out nothing really 

Kamrooz 6 years ago

Even though I love some of yahoo's services..I don't think this would happen..They are losing ground to google after all. =P 

Anonymous 6 years ago

a lot of people use the Yahoo messenger service

frg1 6 years ago
[quote user="Kamrooz"]

Even though I love some of yahoo's services..I don't think this would happen..They are losing ground to google after all. =P 

[/quote]  iguess if they grew this much imagine how much google would grow especailly with android coming out
AjayD 6 years ago

[quote user="News"]The Company also expects $1.4 billion in added search revenue, implying growth essentially in line with the anticipated market rate of growth in search advertising.[/quote] 

Assuming Yahoo's revenue increased proportionate to anticipated market growth, the prospect of doubling their annual revenue within the next three years isn't as far fetched as it initially would seem. I do agree however, that the release of this information, after Microsoft's recent buyout offers is no coincidence. I also believe projected market growth rates are shady at best and given Google's superiority I would envision their growth taking a  sizable bite out of whatever Yahoo's actual growth will be. As blatant of an attempt at raising the corporate value of Yahoo as this is, I doubt it has been anything but beneficial in possibly helping to secure a higher bid from Microsoft.

frg1 6 years ago

 if i was microsoft i would spend that money making msn better

Anonymous 6 years ago

I guess the msn messenger service is much more better than yahoo,because there are much less hacks

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