Yahoo Turns to Search Engine Giant, Google, for Help


After reporting financial losses for the third quarter, Yahoo recently announced that it would begin to use Google to help boost some of its search results and advertising. According to Yahoo’s chief executive, Marissa Mayer, the tech company is still in search (no pun intended) of a viable turnaround plan. According to Mayer []:

Our Q3 results were largely within our forecasted expectations — our GAAP revenue grew 7% year-over-year and our Mavens revenue grew 43%.  As we move into 2016, we will work to narrow our strategy, focusing on fewer products with higher quality to achieve improved growth and profitability. In addition to sharpening focus within core business growth, our top priority is the planned spinoff of Aabaco Holdings. This is an important moment for the Company, and we continue to strive to complete the spin as quickly as we can.

Narrowing Their Focus

Part of Yahoo’s said turnaround plan involves narrowing their strategy, and the first area to feel the effects was Yahoo’s video programming, which is taking a $42 million write-off. You can also likely expect some lay-offs, and scaling back in other areas of the company’s operations.

Making a Deal with Google

Earlier this week, Yahoo signed a mobile search and web deal with Google. The 3-year deal allows Google to supply advertising and search results for some of the search queries made by Yahoo users. And according to Yahoo, this partnership will only serve to bolster their search capabilities as well as complement the search services already provided by Microsoft.

There will also, likely, be a shift towards mobile search initiatives. According to the Yahoo Q3 investor report [], mobile revenue represented 24 percent of traffic-driven revenue, a 4% increase from 2014. As more companies and brands shift the focus to mobile search from desktop search, Mayer reiterated the point that 90 percent of time on phones are spent in mobile apps, not in the browser. Therefore, audiences may see more online experiences driven by mobile apps.

Turning towards Google for help with search results and advertising is a bandaid that may make investors happy for the moment. However, Mayer’s plan to streamline and focus the company remains to be seen.

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