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Yahoo's 2Q results point to hurdles facing new CEO

Associated Press Modified: July 17, 2012 at 7:15 pm •  Published: July 17, 2012
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SAN FRANCISCO (AP) — Just a few hours after Yahoo ushered in Marissa Mayer as its new CEO Tuesday, the struggling Internet company's second-quarter earnings tempered some of the excitement surrounding her hiring.

The results provided a sobering reminder that Mayer is entering a situation dramatically different from what she left behind at Google, where she helped build the Internet's dominant search and advertising service during her 13-year tenure.

Instead of pulling the levers on Google's finely tuned moneymaking machine, she will now be running a financial laggard seemingly unable to devise an effective turnaround strategy.

Mayer, 37, becomes the fifth CEO in the past five years to try to salvage Yahoo.

Investors hoping to hear about Mayer's plans for Yahoo were disappointed Tuesday. She skipped the company's earnings call so she could spend more time meeting with her new management team. Yahoo didn't even provide a forecast on how it might fare in the current quarter.

"We believe it's best to give our new CEO time to get acclimated to Yahoo before providing any future guidance," said the company's chief financial officer, Tim Morse, who ran the conference call.

The second-quarter numbers largely fell in line with the ho-hum performance that investors had anticipated.

Yahoo shares shed three cents to $15.57 in Tuesday's extended trading.

As has been the case for the past year, Yahoo's Internet search partnership with Microsoft Corp. delivered disappointing returns. And the company's Internet ad prices in Europe decreased slightly as government debt woes in several countries on the continent undermined the economy.

Yahoo muddled through its latest quarter under two different CEOs, Scott Thompson and Ross Levinsohn. After Thompson stepped aside in mid-May amid an uproar over misleading information on his biography, Levinsohn began filling in as interim CEO.

Mayer's hiring marked the second time in less than a year that Yahoo has passed over Levinsohn as a candidate to become full-time CEO. He was also interested in the job after Yahoo fired Carol Bartz last September.

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