Ching ching! Yahoo! coins it in

NEWS Yahoo! reported a profit of $50.8m on $321.4m in revenue for the quarter ending 30 June. That compares with a profit of $21.4m on $225.8m in revenue during the same period last year. Although Wall Street analysts commended Yahoo! for showing another strong quarter, some raised warning flags over Yahoo!'s failure to meet the Street's standard of success by beating expectations. Shares of Yahoo! slipped nearly seven per cent in after hours trading from their $35.29 close to $33. Analysts were also deflated by what they expected to be stronger signs of a steady online advertising turnaround, anticipating that a strong quarter from Yahoo! would indicate that that marketers were looking at the internet as a must-buy medium. This quarter did little to boost their hopes. Yahoo!'s online advertising business grew 12 per cent from last year and nine per cent from last quarter, according to Deutsche Banc Alex Brown equity analyst Jeetil Patel. But that's less than analysts expected. "We're still waiting it out and seeing some improvement, but it's just a little slower than expected," Patel said. Nevertheless, Yahoo! also raised its financial expectations for 2003. It now expects revenue to hit between $1.26bn and $1.31bn for the year. The results mark the fifth consecutive quarter that Yahoo! has posted a profit in earnings. The company has reaped financial benefits from its partnership with commercial search provider Overture Services, which pays Yahoo! every time someone clicks on its sponsored search result on the web portal. Yahoo! also showed continued growth in its paid services and core online advertising revenue streams. Jim Hu writes for CNET News.com