Yahoo! Posts Downbeat Q2 Earnings, But Revenue Surges

Shares of Yahoo! Inc. (NASDAQ: YHOO) declined around 2 percent in after-hours trading after the company reported weaker-than-expected earnings for the second quarter on Tuesday.

The Sunnyvale, California-based company reported a quarterly net loss of $21.6 million, or $0.02 per share, versus earnings of $269.7 million, or $0.26 per share, in the year-ago quarter. Its adjusted earnings came in at $0.16 per share for the latest quarter.

Its sales rose to $1.24 billion from $1.08 billion. However, analysts were expecting earnings of $0.18 per share on revenue of $1.03 billion.

The average estimate among 141 Estimize users was for earnings of $0.18 per share and revenue of $1.03 billion.

Cost of acquiring traffic climbed to $200.2 million, compared to $43.8 million, in the year-ago quarter.

GAAP search revenue climbed 22 percent to $521 million for the second quarter. The number of Paid Clicks rose around 13 percent year-over-year in the second quarter, while price-per-click gained approximately 4 percent.

GAAP display revenue gained 15 percent to $500 million for the second quarter. The number of Ads Sold rose approximately 9 percent year-over-year, while price-per-ad surged approximately 10 percent.

As of June 30, 2015, the company had $7.0 billion in cash, cash equivalents, and marketable securities, versus $10.2 billion as of December 31, 2014.

"I'm extremely pleased with our achievements in Q2, with revenue growing 15% year-over-year, marking our most substantial GAAP revenue growth in almost 9 years," said Marissa Mayer, CEO of Yahoo. "Our Mavens investment businesses across mobile, video, native and social grew to nearly $400 million in revenue this quarter, delivering 60% GAAP growth year-over-year. Further, our display business saw the most substantial revenue growth since 2010. Yahoo's transformation continues to make great progress."

Yahoo shares fell 1.94 percent to $38.96 in the after-hours trading session.