Yahoo has posted a 11% rise in net income to $237 million for April-June 2011. The company had registered a net income of $213 million in the second quarter ended June 30, 2010. However net revenues fell by 5% vis-a-vis the year-ago period to $1.08 billion in the quarter under review, dragged down by a drop in display advertising sales.
Yahoo, which had entered into a search tie-up with Microsoft as part of efforts to streamline its operations, said sharing 12% of advertising revenue generated on Yahoo sites with the software giant under the partnership was the primary cause of the second quarter decline in revenue.
The company said excluding Microsoft revenue sharing and other items, net revenue would have grown by 1% during the April-June period of 2011, compared to the year-ago quarter.
Looking ahead, Yahoo expects a net revenue of between $1.05 billion and $1.1 billion in the third quarter, while analysts have been looking at a net revenue of $1.12 billion.
The stock of Yahoo Inc closed up 1.2% to $14.59 in tuesday's trade. At the current market price the company commands a market value of $19 billion and is trading at an estimated PE multiple of over 18 times.