Categories: Enterprise

Yahoo Board Members Considering Sale Of Core Internet Business

Despite all the best efforts by CEO Marissa Mayer, it looks as though Yahoo may be nearing a decision to sell the company’s Internet services businesses completely, if reports on The Wall Street Journal are anything to go by.

Sources with inside knowledge told the newspaper that Yahoo’s board members are currently holding meeting discussing a possible sale, as well as looking at options to further spin off its $30 billion stake in Chinese e-commerce giant Alibaba.

Save Yahoo

Sources reckon one, the other, or both options may eventually happen in order to save Yahoo from its disappointing financial results as shares slid after the company’s October quarterly earnings announcement.

Mayer has worked overtime to turn the company around since her appointment in July 2012. Mayer pushed hard with a mobile, video, native and social media ad strategy in 2014, but revenues from search advertising still continued to fall. Earlier, in 2013, Mayer made the decision to buy blogging website Tumblr, which went some way in increasing Yahoo’s user base, but ultimately disappointed investors who thought the $1.1 billion acquisition was overpriced.

Despite all of this though, Yahoo still has control over one of the biggest Internet user bases in the world, with more than a billion users worldwide.

One option could be the sale of the business to Alibaba itself, which is aggressively pushing to the web space with its shopping platform and browser outside of China.

Yahoo has declined to comment on the speculations this week, but board meeting are expected to take place from Wednesday through Friday.

Yahoo, whilst retaining its large user base, just hasn’t been able to keep up with its rivals. Google boasts bigger numbers and better revenue in search and email, whilst Netflix and Amazon superseded Yahoo with online video.

Alibaba

Yahoo said it would come back to shareholders with a new plan for a post-Alibaba era in January, during its next earnings call.

“I have very aggressive expectations for Yahoo’s core business,” Mayer said in October. “We have the right talent, the right strategy, and the right assets to drive long-term sustainable growth for our investors.”

But in recent months, many senior executives at Yahoo have jumped ship, including chief development officer Jacqueline Reses and Rob Barrett, media strategy boss. Yahoo’s chief marketing officer, Kathy Savitt, also left the company earlier this year.

According to the sources, several private equity firms as well as media and telecoms companies may be interested in the Yahoo sale, which would include the firm’s Yahoo Mail and news sites.

In October 2015, Yahoo boasted user figures of 210.9 million, behind Google at 245.9 million and Facebook at 218.2 million, according to comScore statistics.

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Ben Sullivan

Ben covers web and technology giants such as Google, Amazon, and Microsoft and their impact on the cloud computing industry, whilst also writing about data centre players and their increasing importance in Europe. He also covers future technologies such as drones, aerospace, science, and the effect of technology on the environment.

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