How is Yahoo! making money?

PH01

I thought dot.coms were suppose to lose money and not make profits? Yahoo seem to be bucking the trend, but how are they doing it?

Can anyone explain it?

And is it time to get back into IT?

Yahoo posts higher than expected quarterly profit
Reuters 10-04-03, 09:21

Internet media company Yahoo has reported better-than-expected first-quarter results and said full-year revenues would be at least 5 per cent higher than earlier forecast due to a rebound in advertising and growth in broadband services.

Yahoo also said it had increased its paying subscribers by about a third to 2.9 million as it works toward diversifying its revenue beyond the advertising-only model of its early years.

Shares in Yahoo rose on the news, reaching $23.69 in after-hours trade on Instinet.

Sunnyvale, California-based Yahoo posted a profit for the March-ended quarter of $46.7 million, or 8 cents per share, compared with a year-earlier loss of $53.6 million, or 9 cents per share. The average estimate of analysts surveyed by Multex had been for earnings per share of 6 cents with a high estimate of 7 cents.

Revenue was $282.9 million, compared with $192.7 million a year earlier. The highest Wall Street estimate tracked by Multex had been $281 million.

Yahoo's first-quarter earnings before interest, taxes, depreciation and amortization, or EBITDA, a key metric for media companies, was $84.1 million, compared with $18.8 million a year earlier.

Outside the US, Yahoo did even better, with EBITDA more than doubling from the prior quarter on revenue that jumped more than 70 per cent year over year.

Revenue from Yahoo's fee-generating business, which includes the company's Internet access deal with SBC Communications Inc., rose 61 per cent to $63.7 million.

dmeehan

you already had the answers:

full-year revenues would be at least 5 per cent higher than earlier forecast due to a rebound in advertising and growth in broadband services.

Yahoo also said it had increased its paying subscribers by about a third to 2.9 million as it works toward diversifying its revenue beyond the advertising-only model of its early years.

irlhost

Yahoo now charges all companies for a listing in their directory, and they also charge for ads on their webpages.

Victor

Originally posted by PH01
I thought dot.coms were suppose to lose money and not make profits?

Part of it is they are (a) big enough (b) diversifying revenue streams. The tie-up with SBC Communications means they are charging customers to look at ads that they ar ebeing paid for anyway.