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Previous: YAHOO INC, 8-K, 2000-01-12 |
Next: YAHOO INC, 8-K, 2000-01-12 |
FOR IMMEDIATE RELEASE
Yahoo! Reports Fourth Quarter and
1999 Fiscal Year-End Financial Results
Audience Doubles in 1999 to More Than 120 Million Unique Users
SANTA CLARA, Calif.—Jan. 11, 2000—Yahoo! Inc. (Nasdaq:YHOO) today reported net revenues totaling $201,083,000 for the fourth quarter ended Dec. 31, 1999 compared to net revenues of $91,277,000 for the fourth quarter of 1998, an increase of 120 percent. Pro forma net income for the fourth quarter of 1999 was $57,555,000 or $0.19 per share diluted, excluding acquisition-related amounts and employer payroll taxes on gains realized by employees from non-qualified stock option exercises. This compares with pro forma net income of $12,874,000 or $0.04 per share diluted for the fourth quarter of 1998, excluding acquisition-related charges. Including these charges, net income for the fourth quarter of 1999 was $44,738,000 or $0.15 per share diluted as compared to net income for the fourth quarter of 1998 of $3,840,000 or $0.01 per share diluted.
Net revenues for fiscal 1999 were $588,608,000 compared to $245,100,000 in fiscal 1998, an increase of 140 percent. Pro forma net income for fiscal 1999 was $142,756,000 or $0.48 per share diluted compared to pro forma net income of $14,734,000 or $0.05 per share diluted in fiscal 1998. Pro forma results exclude acquisition-related charges, and employer payroll taxes on gains realized by employees from non-qualified stock option exercises. Including these charges, fiscal 1999 net income was $61,133,000 or $0.20 per share diluted and the fiscal 1998 net loss was $12,674,000 or $0.06 per share diluted.
In a separate announcement today, Yahoo! said its Board of Directors has approved a 2-for-1 common stock split effective Feb. 14, 2000. The above per share calculations do not reflect the effect of the 2-for-1 stock split.
"We exited 1999 as one of the top three global branded networks. Yahoo! has clearly established itself as a leading mass global communications, commerce and media platform," said Tim Koogle, chairman and CEO, Yahoo!. "Throughout the year, we leveraged the inherent scale in our business and carefully managed our business model to deliver superior results to our users, clients, partners and stockholders. We are well-positioned to continue our leadership position in the year ahead, and will continue to invest in growing our business on all fronts."
"In the fourth quarter, as in the rest of 1999, we focused on two significant objectives—serve the world's largest audience through integrated communications, commerce and media services, and provide the most effective interactive marketing platform for advertisers and merchants to connect with our users," said Jeff Mallett, president and chief operating officer, Yahoo!. "As a result, we achieved the most successful quarter in our company's history in terms of record revenues and number of users and customers."
Since its inception, Yahoo!'s core strategy has been to establish relationships with the largest audience of Web users. During December 1999, Yahoo!'s global audience grew to more than 120 million unique users, double the 60 million users it served in the same period in 1998. Yahoo!'s user base outside the United States now exceeds 40 million. In addition, Yahoo!'s non-U.S. operations represented 13 percent of total consolidated revenues during the fourth quarter.
In 1999, Yahoo! continued toward its goal to build the only place anyone in the world needs to go to find information, get connected to anyone or to buy anything.
During 1999, the company significantly grew its media business, while providing an independent distribution platform for leading content and services providers, advertisers and merchants worldwide. Most recently, the company began augmenting its core media business with the Web's largest offering of audio and video content and services. In addition, Yahoo! has formed an extensive network of relationships with an array of ISP, hardware, software, personal digital assistant, and wireless device providers to make Yahoo!® content and services available from any device or access point around the world, at any time.
Yahoo!'s global communications platform, which has scaled to become one of the largest in the world, now provides services locally in 12 languages. During the fourth quarter, the company expanded its popular communications services, providing consumers with the best of voice services over the Web.
Also key to Yahoo!'s core business strategy is to be the world's largest enabler of transactions by providing buyers and sellers with the most diverse set of commerce services on the Web. During the fourth quarter, Yahoo! established itself as one of the major commerce destinations on the Web. Yahoo!'s users conducted more than an estimated $6.7 billion of transactions on the Internet during the fourth quarter, according to research conducted for Yahoo! by InsightExpress.
Yahoo! has established itself as a global leader in interactive advertising, marketing, and transaction services for advertisers and merchants. During the quarter, Yahoo! continued to expand and execute upon its Fusion Marketing Online™ (FMO) platform of services designed to enable clients to take advantage of Yahoo!'s media, direct services and communication tools to meet their marketing goals. Yahoo! and Ford recently joined their powerful online and offline brands through highly-integrated FMO programs to leverage each other's strengths to benefit users of Yahoo! Autos and owners of Ford vehicles.
Audience and Brand Highlights
Commerce Highlights
Communications Highlights
Media Highlights
Advertiser and Merchant Services Highlights
About Yahoo!
Yahoo! Inc. is a global Internet communications, commerce and media company that offers a comprehensive branded network of services to 120 million users each month worldwide. As the first online navigational guide to the Web, www.yahoo.com is the leading guide in terms of traffic, advertising, household and business user reach, and is one of the most recognized brands associated with the Internet. The company also provides online business services designed to enhance Yahoo!'s clients' Web services, including audio and video streaming, store hosting and management, and Web site tools and services. The company's global Web network includes 21 World properties. Yahoo! has offices in Europe, the Asia Pacific, Latin America, Canada and the United States, and is headquartered in Santa Clara, Calif.
This announcement contains forward-looking statements that involve risks and uncertainties, including those relating to the company's ability to grow its user and advertiser bases, its advertising and commerce revenues, and to continue to generate profits and positive cash flow from operations. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of future performance. The potential risks and uncertainties include, among others, the increasingly competitive and constantly changing environment for advertising sales and for Yahoo! branded services, uncertainties associated with the Web as an advertising and commerce medium, the company's dependence on advertising revenues and on third parties for technology, content, and distribution, and the company's ability to successfully integrate its acquired companies. More information about potential factors that could affect the company's business and financial results is included in the company's Current Report on Form 8-K dated July 20, 1999 and amended on Dec. 23, 1999, the Annual Report on Form 10-K for the year ended Dec. 31, 1998, and the Quarterly Report on Form 10-Q for the period ended Sept. 30, 1999, including (without limitation) under the captions, "Management's Discussion and Analysis of Financial Condition and Results of Operations," and "Risk Factors," which are on file with the Securities and Exchange Commission (http://www.sec.gov). Many of the electronic commerce transactions described in this release do not result in revenues to Yahoo!. In addition, overall revenues from electronic commerce transactions have not been significant to Yahoo! in the past. Nothing can or should be inferred about Yahoo!'s future revenues or financial results from the information contained in this press release. The accompanying condensed consolidated statements of operations and balance sheets are an integral part of this announcement.
# # #
Yahoo!, the Yahoo! logo, and Fusion Marketing Online are trademarks and/or
registered trademarks of Yahoo! Inc.
All other trademarks and/or registered trademarks are the property of their respective owners.
Contacts:
Gary
Valenzuela
Chief Financial Officer and
Senior Vice President, Finance & Administration
Yahoo! Inc.
(408) 731-3350
[email protected]
Diane Hunt
Senior Director, Corporate Communications
Yahoo! Inc.
(408) 731-3441
[email protected]
Yahoo! Inc.
Unaudited Pro Forma Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
| |
Three Months Ended December 31, |
Year Ended December 31, |
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| |
1999 |
1998 |
1999 |
1998 |
||||||||
| Net revenues | $ | 201,083 | $ | 91,277 | $ | 588,608 | $ | 245,100 | ||||
| Cost of revenues | 27,204 | 15,823 | 92,334 | 48,608 | ||||||||
| Gross profit | 173,879 | 75,454 | 496,274 | 196,492 | ||||||||
| Operating expenses: | ||||||||||||
| Sales and marketing | 64,744 | 42,655 | 208,991 | 124,734 | ||||||||
| Product development | 19,291 | 10,827 | 64,097 | 33,917 | ||||||||
| General and administrative | 10,113 | 8,495 | 35,286 | 24,154 | ||||||||
| Total operating expenses | 94,148 | 61,977 | 308,374 | 182,805 | ||||||||
| Income from operations | 79,731 | 13,477 | 187,900 | 13,687 | ||||||||
| Investment income, net | 11,008 | 7,839 | 37,699 | 18,806 | ||||||||
| Minority interests in operations of consolidated subsidiaries | (809 | ) | (297 | ) | (2,542 | ) | 68 | |||||
| Income before income taxes | 89,930 | 21,019 | 223,057 | 32,561 | ||||||||
| Provision for income taxes | 32,375 | 8,145 | 80,301 | 17,827 | ||||||||
| Pro forma net income | $ | 57,555 | $ | 12,874 | $ | 142,756 | $ | 14,734 | ||||
| Pro forma net income per share—diluted | $ | 0.19 | $ | 0.04 | $ | 0.48 | $ | 0.05 | ||||
| Shares used in per share pro forma calculation—diluted | 303,001 | 292,909 | 298,395 | 275,369 | ||||||||
Note: The above unaudited pro forma condensed consolidated statements of operations exclude the effects of the following:
The above also assumes a 36% effective tax rate for the pro forma presentation of the three months and year ended December 31, 1999.
The above share and per share calculations do not reflect the effect of the 2-for-1 stock split announced on January 11, 2000.
Yahoo! Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
| |
Three Months Ended December 31, |
Year Ended December 31, |
|||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| |
1999 |
1998 |
1999 |
1998 |
|||||||||
| |
(unaudited) |
(audited) |
|||||||||||
| Net revenues | $ | 201,083 | $ | 91,277 | $ | 588,608 | $ | 245,100 | |||||
| Cost of revenues | 27,204 | 15,823 | 92,334 | 48,608 | |||||||||
| Amortization of purchased technology | 2,291 | 1,667 | 9,465 | 3,546 | |||||||||
| Total cost of revenues | 29,495 | 17,490 | 101,799 | 52,154 | |||||||||
| Gross profit | 171,588 | 73,787 | 486,809 | 192,946 | |||||||||
| Operating expenses: | |||||||||||||
| Sales and marketing | 64,744 | 42,655 | 208,991 | 124,734 | |||||||||
| Product development | 19,291 | 10,827 | 64,097 | 33,917 | |||||||||
| General and administrative | 10,113 | 8,495 | 35,286 | 24,154 | |||||||||
| Payroll taxes on option exercises(1) | 10,345 | — | 10,345 | — | |||||||||
| Amortization of intangibles | 3,676 | 1,469 | 13,815 | 2,628 | |||||||||
| Acquisition-related costs(2) | (945 | ) | 5,898 | 87,542 | 21,234 | ||||||||
| Total operating expenses | 107,224 | 69,344 | 420,076 | 206,667 | |||||||||
| Income (loss) from operations | 64,364 | 4,443 | 66,733 | (13,721 | ) | ||||||||
| Investment income, net | 11,008 | 7,839 | 37,699 | 18,806 | |||||||||
| Minority interests in operations of consolidated subsidiaries | (809 | ) | (297 | ) | (2,542 | ) | 68 | ||||||
| Income before income taxes | 74,563 | 11,985 | 101,890 | 5,153 | |||||||||
| Provision for income taxes | 29,825 | 8,145 | 40,757 | 17,827 | |||||||||
| Net income (loss) | $ | 44,738 | $ | 3,840 | $ | 61,133 | $ | (12,674 | ) | ||||
| Net income (loss) per share—diluted(3) | $ | 0.15 | $ | 0.01 | $ | 0.20 | $ | (0.06 | ) | ||||
| Shares used in per share calculation—diluted | 303,001 | 292,909 | 298,395 | 219,995 | |||||||||
Note: The above share and per share calculations do not reflect the effect of the 2-for-1 stock split announced on January 11, 2000.
Yahoo! Inc.
Condensed Consolidated Balance Sheets
(audited, in thousands)
| |
December 31, 1999 |
December 31, 1998 |
|||||
|---|---|---|---|---|---|---|---|
| ASSETS | |||||||
| Cash, cash equivalents, and investments in marketable debt securities | $ | 961,116 | $ | 626,804 | |||
| Accounts receivable, net | 54,426 | 34,089 | |||||
| Property and equipment, net | 58,111 | 31,007 | |||||
| Investments in marketable equity securities | 250,966 | 1,910 | |||||
| Other assets | 145,202 | 87,209 | |||||
| Total assets | $ | 1,469,821 | $ | 781,019 | |||
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
| Liabilities: | |||||||
| Accounts payable | $ | 13,457 | $ | 9,986 | |||
| Accrued expenses and other liabilities | 100,561 | 52,977 | |||||
| Deferred revenue | 90,708 | 39,796 | |||||
| Total liabilities | 204,726 | 102,759 | |||||
| Minority interests in consolidated subsidiaries | 3,790 | 1,248 | |||||
| Stockholders' equity: | |||||||
| Common Stock | 1,144,179 | 748,015 | |||||
| Accumulated deficit | (11,553 | ) | (71,861 | ) | |||
| Accumulated other comprehensive income | 128,679 | 858 | |||||
| Total stockholders' equity | 1,261,305 | 677,012 | |||||
| $ | 1,469,821 | $ | 781,019 | ||||
Yahoo! Reports Fourth Quarter and 1999 Fiscal Year-End Financial Results
Audience Doubles in 1999 to More Than 120 Million Unique Users
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