Yahoo tops 340M monthly mobile users, suffers Q2 revenue decline


Yahoo now welcomes 340 million mobile users each month, increasing from 300 million in April and 200 million at the close of 2012, CEO Marissa Mayer revealed during the company's second quarter earnings call Tuesday.

"I grade our progress in mobile as an 'A' over the past year," Mayer said, according to a Seeking Alpha transcript. "Back in October, I noted that our No. 1 priority was a cohesive mobile strategy. At that time, the company was severely underinvested in mobile delivering fragmented and unfocused products. Given the growth of phones and tablets, we needed to have a winning strategy and great execution. We invested heavily and we are seeing incredible growth as a result… Mobile is a strong growth driver, and with the right mobile ad units, we believe that mobile will be a large revenue driver. Yahoo's future is mobile and we are delivering our products mobile-first."

Mayer credited Yahoo's mobile gains in part to its aggressive M&A strategy: In recent months, the company has scooped up a number of mobile startups including Summly, Jybe, Alike, Stamped, Astrid, GhostBird Software and Qwiki. The company also purchased social network Tumblr for $1.1 billion. "Our investment in mobile enabled us to grow that team by a factor of six," she said.

Mayer also noted improvements in the company's core mobile apps. "Following our December mail launches we optimized Yahoo! Mail for mobile," she said. "And in Q2 we launched the Yahoo Mail app for tablets. This beautiful magazine-like reading experience has contributed to daily active users being up 120 percent across our mobile mail applications… We also launched our redesigned Yahoo app for iOS and Android complete with some integration. As a result of this launch we saw a 55 percent increase in daily active users and a 60 percent increase in time spent using the application."

Yahoo's mobile growth offset revenue declines: The company reported second-quarter revenues of $1.13 billion, down 7 percent year-over-year. Yahoo's display ad revenue, which represents roughly 40 percent of Yahoo's sales, dropped 12 percent, and search ad revenues slipped 9 percent. "Now that we are actually growing traffic across our network when you consider PC and mobile, we see the opportunity to run more ads," Mayer said. "And so while that hasn't translated to revenue growth yet, we think that it ultimately will and that will happen more in Q4."

For more:
- read this release
- read this Seeking Alpha article
- read this Wall Street Journal article

Related articles:
Yahoo buys iOS video sharing app Qwiki for a reported $50 million
Yahoo scoops up iOS photo app maker GhostBird Software to boost Flickr
Yahoo revamps Flickr for Android, offers free terabyte of photo storage
Yahoo buys Tumblr for $1.1 billion in bid for social media relevance
Yahoo continues mobile shopping spree, buys Astrid to-do app
Yahoo: We now have 300 million mobile monthly users