‘Q2 was one of the most productive in
the history of Yahoo! We basically reached a pace of launching a new product
every week’ – Marissa Mayer, President and CEO
Product
Releases and launches in Q2
Yahoo! launched a beautiful weather app
for iOS including stunning photos from Flicker. At the end of Q2 Yahoo! Weather
was the number one ranked weather app in 23 countries, has held a strong 4.5
star rating in the App Store and received the prestigious Apple Design Award.
This product sets the standard for the visual beauty and ease of use that Yahoo!
is striving for in all of their products and since launch daily users have
increased by 150%.
Yahoo! Mail is also an important driver
of business and was a focus in Q2, following December mail launches, and the
management optimized Yahoo! Mail for mobile and in Q2, the Yahoo! Mail app for
tablets was launched. This beautiful magazine like reading experience has
contributed to daily active users being up 120% across Yahoo! mobile mail
applications.
Also launched redesigned Yahoo! app for
iOS and Android, complete with some integration; as a result of this launch, Yahoo!
saw 55% increase in daily active users and a 60% increase in time spent using
the application.
At the beginning of May, Yahoo! launched
two new monetization products; Yahoo! Stream app and Homepage Billboard. In
both cases it is still early but the reception from advertisers has been warm.
In May, Yahoo! delivered the new Flickr,
puts photos front and center bringing them to life and beautiful full
resolution. Yahoo! also pulled off an engineering marvel giving their Flickr
users one terabyte of space each for free. That space for more than half a
million photos of original, full resolution, pixel perfect quality. Since the
launch, Yahoo! has seen daily photo upload increase by a factor of 3 and
occasionally by a factor of 7 across Flickr desktop and mobile.
Yahoo! Sports app was refreshed with
more content, faster performance and a more modern design. Yahoo! has already
seen 50% growth in daily users from Q1 to Q2 driven by this launch.
Yahoo! introduced a completely
redesigned Search Results page; the new design combines beauty with utility. The
company placed search results high on the page and were delivering them faster
and are doing essentially an experiment each day more than 130 this past
quarter to improve the user experience and deliver revenue and that's in
addition to the work Microsoft is doing on their end.
In Q2 the company also redesigned Yahoo!
News, easier to user and features a personalized news stream. This new design
is the first step towards creating a more consistent and modern content
experience across Yahoo!.
Partnerships
Yahoo! has strengthened partnerships
with major tact players including Apple, Microsoft, Google, Facebook and this
quarter Twitter. In Q2, Yahoo! integrated tweets into their homepage newsfeed.
On the media side, Yahoo! extended their
partnerships with leading news entertainment brands like ABC News, CNBC and
Condé Nast adding breadth to the company’s portfolio of partner content. And
also on the content front, the management intends to bring the complete
Saturday Night Live archives to Yahoo!, all 38 years. Through a partnership
with NBC Entertainment and Broadway Video, Yahoo! will be one of the most
comprehensive digital homes for Saturday Night Live content.
People
In Q2 Yahoo! saw a 59% decrease in
attrition year-over-year. The management has not only inspired Yahoo!
internally, people are applying to work in record numbers. In Yahoo’s peak week,
they received nearly 10,000 resumes.
With aggressive hiring and strategic
acquisitions, Yahoo! has grown their dedicated mobile team by a factor of six
in the past 12 months. Yahoo! has gone from having dozens of engineers to now
having hundreds of engineers dedicated to mobile.
Acquisitions
In Q2 alone Yahoo! closed a number of key
acquisitions including Summly, Astrid, Go Poll Go, Milewise, Loki Studios,
Rondee, Ghostbird Software, PlayerScale and of course Tumblr . ‘These companies
bring sophisticated technology and intellectual property to strengthen our
product portfolio and they bring great engineering and product talent to
Yahoo!’ said Marissa Mayer.
Tumblr
And in May Yahoo! acquired Tumblr. As
one of the fastest growing media networks in the world, Tumblr has an
incredibly engaged community of younger users to complement Yahoo’s core
audience. Since the deal, Tumblr’s growth has seen acceleration with almost a quarter
of a million new blogs being set up each day. While Tumblr is now officially
part of Yahoo!, the Tumblr team will continue to operate independently. They
will continue on their mission to empower creators and curators alike to do
what they love, create.
As part of the Yahoo!, Tumblr gains
access to its sophisticated personalization technologies to improve serendipity
and discovery. Meanwhile, the potential to integrate Tumblr content into
Yahoo's product will create more compelling experiences for its users.
Business
Outlook and Guidance
Traffic improvement is taking shape, the
company also needs to increase its emphasis on monetization and take steps to
optimize pricing and improve the sell through rate.
For Q3, Yahoo! expects revenue excluding
TAC to be in the range of 1.06 billion to 1.1 billion. Adjusted EBITDA to be
between 330 million and 350 million and non- GAAP operating income to be
between 165 million and 185 million.
Relative to annual guidance, Yahoo! is adjusting
its revenue anticipation modestly with the confident results in the first half
of the year. The management is adjusting their EBITDA and operating income
expectations down to account for the lower revenue, investments and expenses
primarily related to Tumblr. They expect full year revenue excluding TAC to be
4.45 billion to 4.55 billion, adjusted EBITDA to be 1.55 billion to 1.65
billion and non-GAAP operating income to be 900 million to 1.0 billion.