Yahoo sees profits jump 28 percent in first quarter

Published:  18 Apr at 6 PM

As reported by the BBC, struggling Internet company Yahoo has watched its profit climb 28% during the first three months of 2012. The California-based company reported a net income of $286 million for revenue of about $1.08 billion in the quarter.

Yahoo has around 700 million users, but has failed to compete with Google in the search engine sector, while its webmail has been outdone by social media including Twitter and Facebook. In after hours trade at the New York Stock Exchange, its shares went up by 2%, reaching $15.32 per share.

CEO Scott Thompson, the ex president of PayPal, seized the reins in January. Despite the positive data, Benchmark CO analyst Clayton Moran says that Yahoo continues struggling in the web advertising space.

Investors seem anxious to hear about how Thompson can turn it around, and are quite sceptical that he can do it, says Moran. It will be difficult for him to convey a convincing comeback strategy, but investors are eager to hear about it, he added.

Earlier in April, the firm announced plans to cut 2,000 staff, or 14% of its workforce. Yahoo expects its cost-slashing programme to save $375 million (£236 million) per year.