<PAGE>
EXHIBIT 99.1
FOR IMMEDIATE RELEASE
YAHOO! REPORTS FOURTH QUARTER,
YEAR END 2000 FINANCIAL RESULTS
FOURTH QUARTER REVENUES INCREASE 53 PERCENT TO NEARLY $311 MILLION,
PRO FORMA EPS INCREASES 44 PERCENT TO $0.13 FROM FOURTH QUARTER 1999
SANTA CLARA, CALIF. - JAN. 10, 2001 - Yahoo! Inc. (Nasdaq: YHOO) today
reported results for the fiscal fourth quarter and the fiscal year ended Dec.
31, 2000. Net revenues for the fourth quarter increased 53 percent to
$310,873,000 from net revenues of $203,148,000 for the fourth quarter of 1999.
Pro forma net income for the fourth quarter of 2000 was $80,242,000 or $0.13 per
share diluted.1 This compares to pro forma net income of $55,703,000 or $0.09
per share diluted for the fourth quarter of 1999.1 Including pro forma charges,
which include a write-down of certain equity investments of $163,221,000, the
net loss for the fourth quarter ended Dec. 31, 2000 was $97,819,000 or $0.17 per
share diluted, compared to net income for the fourth quarter of 1999 of
$37,764,000, or $0.06 per share diluted.
Net revenues for fiscal 2000 were $1,110,178,000, representing an 88
percent increase over net revenues of $591,786,000 in fiscal 1999. Pro forma net
income for fiscal 2000 was $290,983,000 or $0.48 per share diluted compared to
pro forma net income of $138,035,000 or $0.23 per share diluted in fiscal 1999.1
Including pro forma charges, fiscal 2000 net income was $70,776,000 or $0.12 per
share diluted and fiscal 1999 net income was $47,811,000 or $0.08 per share
diluted.
"Yahoo! continued its strong performance in the final quarter of 2000,
capping a year in which we grew revenues by almost 90 percent while expanding
and strengthening the company," said Tim Koogle, chairman and CEO, Yahoo! Inc.
"By almost any measure Yahoo! continued to outperform the industry, and took
market share despite a challenging environment. Yahoo! has become increasingly
essential to consumers and businesses, and we are entering 2001 as one of the
strongest brands in the world. In the coming year, we will invest further in key
initiatives to gain still greater market share and to succeed in the long term."
GLOBAL CONSUMER AUDIENCE
Yahoo! continued to build its leading brand, now ranked among the top 40
consumer brands in the world at No. 38 (Interbrand, July 2000). During the
quarter, Yahoo! also expanded and delivered a deep array of essential
communications, commerce and media services for the world's largest Internet
audience. As a result, the company's audience size and usage reached record
levels. Yahoo!'s global audience grew to 180 million unique users during
December, up from 120 million in December 1999. A record 60 million active
registered members logged onto Yahoo!-Registered Trademark- during December
2000, up from 36 million in December 1999.
-----------------------
(1)Pro forma net income and net income per share calculations for all 2000 and
1999 periods exclude acquisition-related charges, amortization of intangibles
and stock compensation, employer payroll taxes on gains realized by employees
from non-qualified stock option exercises, the write-down of certain equity
investments, and/or the gains or losses from exchanges or sales of certain
equity investments.
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YAHOO! REPORTS FOURTH QUARTER, YEAR END 2000 FINANCIAL RESULTS/PAGE 2
Yahoo! users are consuming more services and staying longer, with usage
increasing more than 94 percent from 1999 page views. The company's traffic
increased to more than 900 million page views per day on average during December
2000. Yahoo! Japan and Yahoo! Europe's traffic, which is included in these page
view totals, increased to more than 116 million and 45 million page views per
day on average in December, respectively. In addition, Yahoo! is ranked No. 1
among the top five Web sites in average combined time spent by home and work
users, which was one hour and 37 minutes in November 2000 (Nielsen//NetRatings).
BUSINESS AND ENTERPRISE SERVICES
Throughout the year, Yahoo! launched a range of business products and
services that are becoming increasingly essential to companies, including
Corporate Yahoo!(TM), a popular customized enterprise portal solution; Yahoo!
Website Services, a turnkey serviCE enabling companies to manage their Web
presence; and most recently, Yahoo! Webcast Studio, which allows business
customers to easily create and stream their own corporate events. Corporate
Yahoo! demonstrated strong momentum during the fourth quarter. Yahoo! now has 18
major corporate clients licensed to make Corporate Yahoo! available to more than
800,000 of their employees, customers and business partners. In addition, Yahoo!
Broadcast hosted and distributed 1,067 streamed audio and video corporate events
for clients during the quarter.
MARKETING AND MERCHANT SERVICES
"The past year proved that only the companies with a leadership position,
financial strength, the best business models, the strongest talent pool, and
leading brand assets will thrive," said Koogle. He noted that while the
advertising market in the fourth quarter was impacted by a decline in spending
experienced across all media types, Yahoo! continued to broaden its client base,
particularly among top-tier advertisers:
- An increasing number of traditional companies are choosing to market on
the global Yahoo! network. Yahoo!'s advertiser count increased to 3,700
from 3,450 in the third quarter. Fortune 50 and 100 advertisers
increased to 32 and 55 respectively.
- Ninety-three percent of the company's top 200 advertisers in the third
quarter continued programs in the fourth quarter 2000. This is an
increase from the 85 percent who continued from the second to the third
quarter.
- During the fourth quarter, Yahoo! enabled $1.4 billion in commerce
transactions, a 110 percent increase compared to fourth quarter 1999.
- Yahoo! Shopping, the Internet's No. 1 shopping portal
(Nielsen//NetRatings, December 2000) enabled 13,000 merchants to sell
directly to Yahoo!'s audience during December.
"The fundamental power of the Internet remains unchanged and it continues
to hold significant advantages over other media in that it is the only medium
that enables businesses to build direct, interactive relationships with their
target audiences and measure results," said Jeff Mallett, Yahoo!'s president and
chief operating officer. "Yahoo! continues to focus on leveraging its assets to
expand its range of services that businesses and consumers find truly essential.
To achieve that, in 2001 our global organization is focused on four strategic
objectives: turning visitors into members, information into services, customers
into partners, and managers into leaders."
"We are very proud of Yahoo!'s performance in the fourth quarter and for
the full year," said Sue Decker, Yahoo!'s chief financial officer and senior
vice president of Finance and Administration. "Yahoo!'s performance in 2000 puts
it among the best-positioned companies to emerge from the
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YAHOO! REPORTS FOURTH QUARTER, YEAR END 2000 FINANCIAL RESULTS/PAGE 3
current market environment in an even stronger competitive position.
Additionally, our track record of profitability, the strength of our balance
sheet and our conservative fiscal discipline, provides us with the ability to
invest in our platform and deliver increasing value for our shareholders,
consumers and business partners."
Financial highlights for 2000 include the following:
- Fiscal year 2000 revenues grew to $1.1 billion, up 88 percent from
1999, while fourth quarter revenue reached nearly $311 million, a 53
percent increase from the same period in 1999.
- Non-U.S. operations represented 15 percent of total consolidated
revenues during the full year, excluding the company's 34 percent
interest in Yahoo! Japan. Business services accounted for 10 percent of
consolidated revenue.
- Pro forma earnings before interest, tax, depreciation and amortization
(EBITDA) was $411 million for the year, up 117 percent from 1999.
- EBITDA margins were 37 percent for fiscal year 2000 and 36 percent for
the fourth quarter.
- Cash and marketable debt securities were approximately $1.7 billion at
year end.
BUSINESS OUTLOOK
"We are more confident than ever in the fundamental power of the Internet
and how Yahoo!'s core business strategies position it to capitalize on future
Internet growth. It is the most significant and effective medium ever created
for consumers and businesses, and its commercial importance will continue to
increase in the coming years, driving further growth for leaders such as
Yahoo!," Decker said. "Over the next year, we expect to see some short-term
effects from the apparent softening economy and the continued realignment of our
client base. However, when we exit 2001, Yahoo! will be well on its way to
becoming the Internet's leading global consumer and business services company."
Yahoo! will continue to invest in and extend its global leadership position
and take advantage of opportunities to build market share. In addition to its
core efforts to aggressively expand its communications, commerce and media
areas, the company will invest in its ongoing effort to deliver essential
marketing and merchant services, business and enterprise solutions, and premium
consumer services.
For the full year 2001, Yahoo! expects revenues to be $1.2 billion to $1.3
billion, with marketing services and commerce accounting for 80 percent to 85
percent of revenues, and business services growing to 15 percent to 20 percent.
In the first quarter of 2001, Yahoo! expects revenues between $220 million and
$240 million, which reflects a changing customer mix, an expectation of slower
advertising expenditures, and a continuation of current general economic
conditions.
For the full year 2001, Yahoo! expects pro forma EBITDA margins to average
between 25 percent and 30 percent. In the 2001 first quarter, EBITDA margins are
estimated at 16 percent to 20 percent. Based on these assumptions and its
strategic growth initiatives, the company expects pro forma earnings per share
(EPS) of $0.33 to $0.43 for the full year 2001. Pro forma EPS for the first
quarter 2001 is expected to be in the range of $0.04 to $0.07 per share.
The company expects depreciation to be approximately $15 million to $16
million in the first quarter and $75 million to $85 million for fiscal year
2001. Charges related to amortization are expected to be approximately $14
million to $15 million in the first quarter and $50 million to $55 million for
the full 2001 year. These figures include the pending acquisition of Kimo, which
accounts for approximately
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YAHOO! REPORTS FOURTH QUARTER, YEAR END 2000 FINANCIAL RESULTS/PAGE 4
$7 million and $30 million in the first quarter and the full year 2001,
respectively. In the event that Yahoo! makes additional acquisitions of
companies during 2001, among other factors, expected amortization charges could
change significantly. The company expects its pro forma tax rate for the fiscal
year 2001 to be 39 percent.
Due to its growing mix of advertising revenues from traditional and
international marketing clients, Yahoo! expects that its days sales outstanding
levels going forward will trend toward those of the best-managed traditional
media companies, which tend to be in the 30 to 50 days range.
Capital spending for the first quarter and the full year 2001 is expected
to be approximately $70 million to $80 million and $170 million to $200 million,
respectively. Of these expenditures, $40 million in the first quarter and $50
million for the full year 2001 are attributable to Yahoo!'s planned move to a
new headquarters facility during the first half of 2001.
These business outlook statements, as well as the statements regarding
Yahoo!'s future market share, plans to invest, business strategy, prospects for
the Internet generally, and expenditures for advertising specifically, are based
on current expectations as of today only. Due to economic and advertising market
variables, among other factors, actual results could be above or below the
stated outlook. Yahoo!'s business outlook will be available on its Investor
Relations Web site throughout the current quarter. Yahoo! makes these statements
as of today and undertakes no obligation to update these statements. It is
currently expected that these business outlook statements will not be updated
until the release of Yahoo!'s next quarterly earnings announcement. The company
reserves the right to update the outlook for any reason during the quarter,
including the occurrence of material events.
QUARTERLY CONFERENCE CALL
Yahoo! will host a conference call today to discuss fourth quarter and fiscal
year 2000 results at 5:00 p.m. Eastern Time. A live Webcast of Yahoo!'s
conference call can be accessed at http://webevents.broadcast.com/yahoo/
q400earnings. In addition, a replay of the call will be available for
48 hours following the conference call and can be accessed through the
"Conference Calls" area of the company's Investor Relations Web site at
www.yahoo.com/info/investor, or by calling (800) 633-8284, reservation No.
16498855.
ABOUT YAHOO!
Yahoo! Inc. is a global Internet communications, commerce and media company
that offers a comprehensive branded network of services to more than 180 million
individuals 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. Yahoo! is the most recognized and valuable
Internet brand globally, and is ranked the No. 38 leading consumer brand
worldwide. The company also provides online business and enterprise services
designed to enhance the productivity and Web presence of Yahoo!'s clients. These
services include Corporate Yahoo!, a popular customized enterprise portal
solution; audio and video streaming; store hosting and management; and Web site
tools and services. The company's global Web network includes 24 World
properties. Yahoo! has offices in Europe, the Asia Pacific, Latin America,
Canada and the United States, and is headquartered in Santa Clara, Calif.
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YAHOO! REPORTS FOURTH QUARTER, YEAR END 2000 FINANCIAL RESULTS/PAGE 5
The matters discussed in this release contain forward-looking statements
that involve risks and uncertainties. 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 slower spending environment for advertising sales, including
the lack of access to capital to fund early stage companies; the actual
increases in demand by customers for Yahoo!'s branded services; the ability to
successfully change the customer mix among Yahoo!'s advertising customers;
general economic conditions; and the dependence on third parties for technology,
content and distribution. More information about potential factors that could
affect the company's business and financial results is included in the company's
Annual Report on Form 10-K for the year ended Dec. 31, 1999, and Yahoo!'s
quarterly report on Form 10-Q for the three- and nine-month periods ended Sept.
30, 2000, including (without limitation) under the captions, "Risk Factors" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations," which are on file with the Securities and Exchange Commission.
Additional information will also be set forth in those sections in Yahoo!'s
Annual Report on Form 10-K for the year ended Dec. 31, 2000, which will be filed
with the Securities and Exchange Commission by March 31, 2001.
# # #
Yahoo!, Corporate Yahoo!, and the Yahoo! logos are trademarks and/or
registered trademarks of Yahoo! Inc. All other names are trademarks and/or
registered trademarks of their respective owners.
CONTACTS:
Diane Hunt, Corporate Communications, Yahoo! Inc., (408) 731-3441,
[email protected]
Nicki Dugan, Corporate Communications, Yahoo! Inc., (408) 992-7361,
[email protected]
Andrea Klipfel, Investor Relations, Yahoo! Inc., (408) 731-3402,
[email protected]
<PAGE>
YAHOO! INC.
FOURTH QUARTER 2000 OPERATING HIGHLIGHTS
JAN. 10, 2001
During 2000, Yahoo! achieved strong growth of the Yahoo! brand, its
audience, services and customers.
THE YAHOO! BRAND
- The Yahoo! brand is now ranked the No. 38 leading consumer brand in the
world and is valued at more than $6.3 billion. In addition, Yahoo! has
become the most valuable Internet brand globally (Interbrand, July
2000).
- Yahoo! now has the highest brand awareness, both aided and unaided,
among all Internet portal brands in North America (IDC, September
2000).
AUDIENCE GROWTH, USAGE AND LOYALTY
- Yahoo! continues to be the No. 1 ranked network worldwide, with the
highest reach globally. With a 51 percent reach of home users, Yahoo!
is a clear leader among all Internet companies (Nielsen//NetRatings,
November 2000).
- The Yahoo! network reaches 62.6 percent of the combined U.S. home/work
audience, and is ranked No. 1 among work users (69.4 percent reach) and
No. 2 among home users (55.4 percent reach) according to
Nielsen//NetRatings (November 2000).
- Yahoo!'s audience size and usage achieved record levels during the
fourth quarter. Yahoo!'s global audience grew to more than 180 million
unique users during December 2000, up from 120 million in December
1999. A record 60 million active registered members logged into Yahoo!
during December 2000, up from 36 million in December 1999.
- Yahoo! users consume more and stay longer, with usage increasing more
than 94 percent from 1999 page views. The company's traffic increased
to more than 900 million page views per day on average during December
2000. Yahoo! Japan and Yahoo! Europe's traffic, which is included in
these page view totals, increased to more than 116 million and 45
million page views per day on average in December, respectively.
- Yahoo! is ranked No. 1 among the top five Web sites in average combined
time spent by home and work users, which was one hour and 37 minutes in
November 2000 (Nielsen//NetRatings). And, according to Media Metrix's
custom research, Yahoo! is ranked No. 1 in month-to-month visitor
retention (79.1 percent) among the top six Web domains
(October-November 2000).
CONSUMER SERVICES
During the fourth quarter, Yahoo! continued to build the only place
anyone needs to go to find anything, get connected to anyone, or buy anything,
by expanding and delivering a broad and deep array of essential content,
commerce and communications services for the world's largest Internet audience.
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YAHOO! FOURTH QUARTER 2000 OPERATING HIGHLIGHTS/PAGE 2
- In a move to enhance the quality of consumers' online experience,
Yahoo! recently introduced modifications to its U.S. commerce platform,
including a Buyer Protection Program to protect purchases made on
Yahoo! Auctions and Yahoo! Shopping; a nominal listing fee and new
monitoring program on Yahoo! Auctions; and refined commerce guidelines
prohibiting items associated with groups that promote or glorify hatred
and violence.
- Yahoo! also launched Yahoo! ShoppingVision, a rich media service
enabling consumers to view streaming video content and simultaneously
purchase contextually relevant merchandise from one interface.
- Yahoo! broadcast several key events during the quarter, including the
post-premiere party for THE GRINCH; Yahoo! Sports Invitational -
Division I Basketball; live nationwide coverage of Election Night 2000;
and the Webcast launch of Disney's Touchstone Pictures movie
UNBREAKABLE. Yahoo! also entered an agreement to stream ABCNews.com
content.
- In communications, Yahoo! launched an encrypted e-mail delivery feature
for Yahoo! Mail. Yahoo! also introduced Personal Address, which is
available to users for $35 per year and includes registration of a
personalized domain name and five e-mail addresses for that domain. In
France, Yahoo! Minitel will be launched, making Yahoo! Mail available
to 15 million Minitel users at home and work.
- During the fourth quarter, Yahoo! launched several new free
voice-enabled services, including Yahoo! By Phone, which provides
access to popular My Yahoo!-Registered Trademark- content over the
telephone. Yahoo! Mail now incorporates voice telephony, which
allows users to listen to their email over the phone. And, an
updated version of Yahoo! Messenger gives consumers the ability to
place PC-to-phone calls to anywhere within the continental United
States.
- Yahoo! and the National Football League (NFL) entered a multi-faceted
content and distribution agreement, including live audio play-by-play
Webcasts of virtually all of this season's regular season NFL games via
Yahoo! Sports, the No. 1 ranked sports site on the Web (Media Metrix
custom report, November 2000). The agreement marks the first time
football fans can access live NFL game audio for free on the Internet
at NFL.com and includes access to NFL content.
Further extending the growth of key business areas globally, Yahoo! signed a
number of strategic agreements and launched several new services with device and
wireless providers in the United States and across Europe, Asia and Latin
America.
- Yahoo! Europe and Packard Bell, the Consumer Division of NEC Computers
International and the leader in the European home personal computer
(PC) market, entered an agreement to deliver Yahoo! content and
services through one-touch access on more than one million Packard Bell
PCs in Germany, France, Spain, Italy, Sweden, Denmark and Norway.
- Yahoo! launched mobile commerce services on Web-enabled phones,
including Yahoo! Shopping, Yahoo! PayDirect and Yahoo! Local Sales.
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YAHOO! FOURTH QUARTER 2000 OPERATING HIGHLIGHTS/PAGE 3
- The company teamed with Motient and WebLink Wireless to deliver Web
content and services to two-way messaging devices.
- Yahoo! entered wireless agreements with Telesp Celular in Brazil,
Shinsegi Telecom in Korea, and Hutchinson/Orange in Hong Kong.
- In Turkey, Yahoo! and SuperOnline, Turkey's largest Internet service
provider, teamed to provide SuperOnline users with access to Yahoo!
personal information management content and services in Turkish through
a Yahoo! module on SuperOnline's homepage, which also will include
links to www.yahoo.com.
BUSINESS AND ENTERPRISE SERVICES
Yahoo! launched a range of business products and services during 2000 that
are becoming increasingly essential to companies.
- Corporate Yahoo!, a popular customized enterprise portal solution,
demonstrated strong momentum during the fourth quarter. Yahoo! now has
18 customers licensed to make Corporate Yahoo! available to more than
800,000 of their employees, customers and business partners. Major new
customers include Bayer AG, Corio, Government Securities Clearing
Corporation, Hall Kinion & Associates, Health Net Inc., Janus Capital
Corporation, McDonald's Corporation, Merck Sharp & Dohme, Reuters,
Seagate Technology and JLT Services.
- Yahoo! recently introduced new Corporate Yahoo! features, including
wireless access capabilities with Yahoo! PortalBuilder 2.0 software, as
well as additional technology, developer and channel agreements with
Accenture (formerly Andersen Consulting), Corio, EnfoTrust Networks,
Intraware, Novell, nQuire and Reuters.
- Yahoo! Broadcast hosted and distributed 1,067 streamed audio and video
corporate events for clients during the quarter, including key new
accounts such as the American Bar Association, Amgen, Deere & Co. (John
Deere), Kellogg Company, Kohler Company, Owens Corning, Tenneco
Automotive, WorldCom and Xilinx.
- Yahoo! Broadcast also launched Yahoo! Webcast Studio, a new Webcast
production platform that streamlines delivery of rich, interactive
events, enabling business services customers to easily stream their own
corporate events.
INTERACTIVE MARKETING AND MERCHANT SERVICES
- Yahoo! served 3,700 advertisers and merchants during the third quarter,
including more than 1,400 clients outside the United States. New
accounts and major traditional brands served in the fourth quarter
include Columbia House, First Union Corporation, Mitsubishi, Sir
Speedy, The Weather Channel, TowerRecords.com, Uniroyal Tires and
Veritas Software.
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YAHOO! FOURTH QUARTER 2000 OPERATING HIGHLIGHTS/PAGE 4
- Yahoo! launched the Yahoo! Buzz Index, an interactive market research
system developed by Yahoo! to measure public engagement with brands,
products, people and technologies on the Internet. Part of Yahoo!'s
Fusion Marketing suite of services, the Yahoo! Buzz Index leverages the
speed of the Internet by capturing trends nearly immediately and
provides insight into the interests of the world's largest connected
audience, helping marketers to continually ensure the effectiveness of
their online and offline campaigns.
- Yahoo! also introduced Yahoo! Full Service, an interactive suite of
data-driven tools and services, which enhances a media program and
enables marketers to more easily achieve their objectives. Many of
Yahoo!'s clients are taking advantage of Yahoo! Full Service's
unparalleled media targeting, advanced analysis and measurement
capabilities, including Ford Motor Company, Honda and Weblink Wireless.
- Yahoo!'s commerce platform, which includes Yahoo! Shopping, the No. 1
ranked shopping portal in 2000 (Nielsen//NetRatings, December 2000)
enabled more than 13,000 merchants in December to sell directly to
Yahoo!'s consumer audience.
- Yahoo! enabled more than $1.4 billion of online transactions through
its commerce platform, including Yahoo! Japan during the fourth
quarter, a 110 percent increase compared to fourth quarter 1999.
- Domestically, Yahoo! Shopping order volume doubled during the 2000
holiday shopping season, and increased more than six times outside the
United States.
- Brand name merchants that joined or renewed agreements with Yahoo!
Shopping during the fourth quarter include Avon, Circuit City, Compaq,
Crutchfield, Handspring, JCPenney, the NBA Store, Saks Fifth Avenue,
Target, and others. Yahoo! also conducted co-marketing promotions with
The Gap (in 1,600 stores), Eddie Bauer, Subway (in 8,000 stores), NBA,
Sam Goody and FAO Schwartz.
GLOBALIZATION
- Yahoo! remained committed to broadening its global footprint and
maintaining a leadership position worldwide. During the quarter, the
company strengthened its reach and position across Greater China and
acquired Kimo.com, the leading Web portal in Taiwan. In addition,
Yahoo! made a minority investment in Australia's carsales.com.au Ltd,
which provides comprehensive car listings to users of Yahoo! Australia
& New Zealand.
- Yahoo! also launched Yahoo! Canada en francais, an Internet guide
designed specifically for Quebecois and Francophones in Canada
# # #
Yahoo!, Corporate Yahoo!, My Yahoo! and the Yahoo! logos are trademarks
and/or registered trademarks of Yahoo! Inc. All other names are trademarks
and/or registered trademarks of their respective owners.
<PAGE>
YAHOO! INC.
Unaudited Pro Forma Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
------------------------------- -----------------------------------
2000 1999 2000 1999
------------ ------------ -------------- --------------
<S> <C> <C> <C> <C>
Net revenues $ 310,873 $ 203,148 $ 1,110,178 $ 591,786
Cost of revenues 40,071 27,712 149,744 93,181
------------ ------------ -------------- --------------
Pro forma gross profit 270,802 175,436 960,434 498,605
------------ ------------ -------------- --------------
Operating expenses:
Sales and marketing 122,252 66,970 407,854 213,846
Product development 29,179 19,836 102,382 65,309
General and administrative 17,974 11,637 65,511 38,900
------------ ------------ -------------- --------------
Total operating expenses 169,405 98,443 575,747 318,055
------------ ------------ -------------- --------------
Pro forma income from operations 101,397 76,993 384,687 180,550
Investment income, net 27,901 10,852 89,939 37,672
Minority interests in operations
of consolidated subsidiaries 124 (809 (5,298) (2,542)
------------ ------------ -------------- --------------
Pro forma income before income taxes 129,422 87,036 469,328 215,680
Provision for income taxes 49,180 31,333 178,345 77,645
------------ ------------ -------------- --------------
Pro forma net income $ 80,242 $ 55,703 $ 290,983 $ 138,035
============ ============ ============== ==============
Pro forma net income per share - diluted $ 0.13 $ 0.09 $ 0.48 $ 0.23
============ ============ ============== ==============
Shares used in per share pro forma
calculation - diluted 599,518 609,136 610,678 599,558
============ ============ ============== ==============
---------------------------------------------------------------------------------------------------------------------------------
SUPPLEMENTAL FINANCIAL DATA
Pro forma EBITDA (1) $ 111,077 $ 71,253 $ 410,605 $ 189,586
Pro forma after tax cash earnings (2) $ 90,897 $ 53,687 $ 322,546 $ 150,795
Pro forma after tax cash earnings
per share - diluted $ 0.15 $ 0.09 $ 0.53 $ 0.25
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>
Notes: All notes are in thousands.
The above unaudited pro forma condensed consolidated statements of
operations are not a presentation in accordance with generally accepted
accounting principles as they exclude the effects of the following:
- Acquisition-related costs are primarily composed of charges related to
the acquisitions of eGroups, broadcast.com, GeoCities, and Log-Me-On
in the amounts of $22,370, $22,125, $56,125, and $9,775 in the
quarters ended September 30, 2000, September 30, 1999, June 30, 1999,
and March 31, 1999, respectively.
- Employer payroll taxes assessed on stock option gains realized by
employees.
- Stock compensation expense.
- Amortization of purchased technology and goodwill.
- Investment income related to gains from the exchanges of certain
equity investments of $730, $5,017, and $40,656 in the quarters ended
December 31, 2000, September 30, 2000, and March 31, 2000,
respectively.
- Investment losses of $163,221 related to the write-down and $2,126
related to the sale of certain equity investments in the quarter ended
December 31, 2000.
- Goodwill amortization, included in investment
income, related to the Yahoo! Japan equity investment of $1,786 in the
quarter ended December 31, 2000 and $1,455 in each of the quarters
ended September 30, 2000 and June 30, 2000.
The above also assumes 38% and 36% effective tax rates for the pro forma
presentation of the periods ended December 31, 2000 and 1999, respectively.
(1) Defined as income from operations before depreciation and amortization,
stock compensation expense, and acquisition-related charges.
(2) Defined as pro forma net income before depreciation but after payroll
taxes on option exercises.
<PAGE>
YAHOO! INC.
Condensed Consolidated Statements of Operations
(in thousands, except per share amounts)
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEAR ENDED
DECEMBER 31, DECEMBER 31,
------------------------------------- --------------------------------------
2000 1999 2000 1999
----------------- ---------------- ------------------- ---------------
(UNAUDITED) (AUDITED)
<S> <C> <C> <C> <C>
Net revenues $ 310,873 $ 203,148 $ 1,110,178 $ 591,786
Cost of revenues 40,071 27,712 149,744 93,181
Amortization of purchased technology 2,243 2,291 8,675 9,465
-------------- ------------- --------------- --------------
Total cost of revenues 42,314 30,003 158,419 102,646
-------------- ------------- --------------- --------------
Gross profit 268,559 173,145 951,759 489,140
-------------- ------------- --------------- --------------
Operating expenses:
Sales and marketing 122,252 66,970 407,854 213,846
Product development 29,179 19,836 102,382 65,309
General and administrative 17,974 11,637 65,511 38,900
Payroll taxes on option exercises (1) 2,566 10,345 14,856 10,345
Stock compensation expense 3,708 5,515 20,898 10,389
Amortization of intangibles 5,418 3,676 19,653 13,815
Acquisition-related costs (2) - (444) 22,785 88,043
-------------- ------------- --------------- --------------
Total operating expenses 181,097 117,535 653,939 440,647
-------------- ------------- --------------- --------------
Income from operations 87,462 55,610 297,820 48,493
Investment income (loss), net (3) (138,502) 10,852 (33,701) 37,672
Minority interests in operations
of consolidated subsidiaries 124 (809) (5,298) (2,542)
-------------- ------------- --------------- --------------
Income (loss) before income taxes (50,916) 65,653 258,821 83,623
Provision for income taxes 46,903 27,889 188,045 35,812
-------------- ------------- --------------- --------------
Net income (loss) $ (97,819) $ 37,764 $ 70,776 $ 47,811
============== ============= =============== ==============
Net income (loss) per share - diluted $ (0.17) $ 0.06 $ 0.12 $ 0.08
============== ============= =============== ==============
Shares used in per share calculation
- diluted 559,872 609,136 610,678 599,558
============== ============= =============== ==============
</TABLE>
Notes: All notes are in thousands.
(1) In September 1999, the FASB issued a Staff announcement which requires
employer payroll taxes assessed on stock option gains realized by
employees to be recorded in the income statement.
(2) Acquisition-related costs are primarily composed of charges related to
the acquisitions of eGroups, broadcast.com, GeoCities, and Log-Me-On
in the amounts of $22,370, $22,125, $56,125, and $9,775 in the
quarters ended September 30, 2000, September 30, 1999, June 30, 1999,
and March 31, 1999, respectively.
(3) Investment income includes losses of $163,221 related to the
write-down and $2,126 related to the sale of certain equity
investments in the quarter ended December 31, 2000 and gains from the
exchanges of certain equity investments of $730, $5,017, and $40,656
in the quarters ended December 31, 2000, September 30, 2000, and March
31, 2000, respectively. Investment income also includes goodwill
amortization related to the Yahoo! Japan equity investment of $1,786
in the quarter ended December 31, 2000 and $1,455 in each of the
quarters ended September 30, 2000 and June 30, 2000.
<PAGE>
YAHOO! INC.
Consolidated Summary Balance Sheet Data
(in thousands)
<TABLE>
<CAPTION>
December 31, DECEMBER 31,
2000 1999
-------------------------- -------------------------
<S> <C> <C>
ASSETS
Cash, cash equivalents, and investments
in marketable debt securities $ 1,688,666 $ 1,004,301
Accounts receivable, net 90,561 56,454
Property and equipment, net 109,781 60,798
Investments in marketable equity securities 87,545 250,966
Other assets, net 293,023 147,610
--------------------- ----------------------
Total assets $ 2,269,576 $ 1,520,129
===================== ======================
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Accounts payable $ 26,040 $ 14,341
Accrued expenses and other liabilities 200,144 107,303
Deferred revenue 117,165 90,790
--------------------- ----------------------
Total liabilities 343,349 212,434
--------------------- ----------------------
Minority interests in consolidated subsidiaries 29,313 3,790
Mandatory redeemable convertible preferred stock - 52,173
Stockholders' equity:
Common Stock 1,831,088 1,148,903
Retained earnings (accumulated deficit) 42,480 (25,842)
Accumulated other comprehensive income 23,346 128,671
--------------------- ----------------------
Total stockholders' equity 1,896,914 1,251,732
--------------------- ----------------------
$ 2,269,576 $ 1,520,129
===================== ======================
</TABLE>
<PAGE>
YAHOO! INC.
Consolidated Summary Cash Flows Data
(in thousands)
<TABLE>
<CAPTION>
Three Months Ended Year Ended
December 31, December 31,
---------------------------------- --------------------------
2000 1999 2000 1999
---------------- ---------------- ------------ ------------
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (97,819) $ 37,764 $ 70,776 $ 47,811
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 19,907 10,572 69,102 42,661
Tax benefits from stock options 46,991 24,718 172,525 32,202
Other non-cash items 166,805 7,524 144,822 23,906
Change in working capital (56,946) 7,077 52,482 57,916
------------- ------------ ------------ -----------
Net cash provided by operating activities 78,938 87,655 509,707 204,496
------------- ------------ ------------ -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of property and equipment (28,628) (20,166) (94,413) (52,426)
Purchases of equity securities (16,989) (15,368) (106,675) (67,747)
Sales of equity securities 15,200 - 15,200 -
Other 4,287 - 11,368 -
------------- ------------ ------------ -----------
Net cash used in investing activities (26,130) (35,534) (174,520) (120,173)
------------- ------------ ------------ -----------
CASH FLOWS FROM FINANCING ACTIVITIES AND OTHER:
Proceeds from issuance of Capital Stock, net 29,379 155,509 352,279 281,055
Other (3,991) 4,156 (3,101) 2,844
------------- ------------ ------------ -----------
Net cash provided by financing activities and other 25,388 159,665 349,178 283,899
------------- ------------ ------------ -----------
Net change in cash, cash equivalents, and marketable
debt securities 78,196 211,786 684,365 368,222
Cash, cash equivalents, and marketable debt securities
at beginning of period 1,610,470 792,515 1,004,301 636,079
------------- ------------ ------------ -----------
Cash, cash equivalents, and marketable debt securities
at end of period $ 1,688,666 $ 1,004,301 $ 1,688,666 $ 1,004,301
============= ============ ============ ===========
</TABLE>
