CEO vows to get 'pathetic' Yahoo back on 'tippy toes'
Friday 30 October 2009
With its stock in a three-year funk, Yahoo set out yesterday to persuade investors the internet company's struggles are nearly over.
"We have fallen and we really want to get back up," Yahoo chief executive Carol Bartz said as she kicked off an all-day meeting with financial analysts. "We really want to get back on our tippy toes."
Bartz vowed to make the company more profitable, and said she hoped the session would win back some of the respect that the company lost as two previous CEOs were unable to deliver on their turnaround promises.
As a first step, Yahoo pledged to boost its operating profit margin to a range of 15 per cent to 20 per cent by 2012, up from just 6 per cent this year - a performance Bartz derided as "pathetic".
Although it didn't set a specific timetable for hitting a target, Yahoo said it believes it could increase its annual revenue by nearly $1.5 billion (£907 million). The company, based in Sunnyvale, thinks it can rake in the extra money doing a better job of capitalising on a marketing shift to the internet in the US and expanding its market share internationally.
Yahoo expects its revenue this year to be about $6.4 billion (£3.8 billion), a decline of roughly 11 per cent from 2008. Management also plans to increase profits by weeding out expenses, simplifying its computer coding and eliminating wasteful spending. Yahoo already has trimmed its work force by 13 per cent, or 2000 jobs, during the past year.
Yahoo also is expecting big things from a proposed internet search partnership with rival Microsoft.
Under the proposed alliance, Microsoft will process users' internet search requests on Yahoo's website and provide much of the advertising tied to those inquiries. The deal, which still requires regulatory approval, is supposed to lower Yahoo's expenses, freeing the company to focus on luring more traffic to its website.
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