Yahoo (NASDAQ:YHOO) has been through some pretty tough times in the last couple of quarters as its core businesses are on a declining curve and its management continues to ride through waves of controversies. The top management has been reshuffled twice, after the very public and embarrassing ouster of its former CEO, Scott Thompson.
Since then, it has been focused on restructuring its business in a bid to become relevant again. Despite its massive user traffic — almost 700 million users across its online properties — Yahoo has seen its share of the display advertising market decline. The company’s primary focus in 2012 is expected to be better monetization of its digital content, which could help it generate more revenue and protect its online advertising market share.
In the last couple of months, Yahoo has been focusing on its popular content properties, and is aiming to transform itself into the premier media destination on the Internet, just like it was in its old glory days, so it can capture additional ad dollars.
It has set aside its differences with Facebook and has entered into a new advertising partnership. It also entered into content deals with the likes of Spotify and CNBC and is continuing to restructure its businesses to create a leaner, meaner, and more efficient Yahoo which can compete with the upstarts.
While there is still be a couple of months before Yahoo’s new initiatives start to show results, we will look closely at its earnings for any signs of revival.
We currently have a $18 Trefis price estimate for Yahoo, which stands nearly 20% above its market price. Display and search advertising currently generate most of its revenue. It competes in the online advertising space with the likes of Google (NASDAQ:GOOG) and Facebook (NASDAQ:FB).