Internet firm Yahoo has reported a drop of 19 per cent in its year-on-year net profits.
However, investors remained optimistic, in the face of the strain on the US economy and Microsoft’s recent failed takeover bid, with shares rising 2.7 per cent following the quarterly report.
Net income fell in the second quarter from $161 million to $131 million. Although turnover fell short of expectations, it still grew by 8 per cent with net revenue valued at $1.35 billion.
One of the causes for the drop in profits has been the end of Yahoo’s joint broadband internet venture with AT&T, which had added about $40 million gross profit to Yahoo’s bottom line.
Yahoo also still remains the market leader in internet based advertising services and gained market share despite a slump.
These results were released the day after Yahoo agreed to appoint Carl Icahn to its board, preventing the need for another proxy battle at its AGM and crucially making Icahn subject to a gagging order.
An analyst for Sanford Bernstein said: “Investors braced for the worst. These results are poor, but relative to what people were expecting, they’re not so bad.”