Despite a hacking breach, its alleged invasion of users' privacy and doubts surrounding a major deal with Verizon, Yahoo! Inc. (YHOO) beat investors expectations with a relatively positive third quarter earnings report on Tuesday. The company posted third quarter earnings per share (EPS) of $0.20 on revenues of $1.31 billion, compared to $0.09 for the previous quarter and $0.15 for the third quarter last year.
Chief Executive Officer Marissa Meyer said she was “pleased” with the results, and added, in a nod to the company’s recent hacking debacle and email-scanning scandal, that Yahoo leaders “take deep responsibility in protecting our users and the security of their information,” according to a company press release. “We’re working hard to retain their trust and are heartened by their continued loyalty as seen in our engagement trends.”
Yahoo’s revenue rose 6.5 percent over the past year, to $1.31 billion from $1.23 billion for the quarter ending in September 2015. It dipped slightly, however, from the previous quarter, by about $2 million. Zacks Investment Research had predicted the California-based company would post an EPS of $0.05 for the quarter, while analysts polled by Thomson Reuters forecasted an EPS of $0.14.
Yahoo did not hold its traditional conference call upon releasing its earnings for the third quarter, leaving investors in the dark on issues that plagued the company in recent months, such as the hacking of 500 million users' accounts in September, and the company's own scanning of users' emails at part of an FBI terrorist hunt.
In a press release prior to the third quarter earnings announcement, Yahoo attributed the decision to keep quiet on its pending $4.8 billion deal with Verizon Communications, which last week signaled its intentions to renegotiate the acquisition afterYahoo’s drop in value following the data breach. Verizon intends to combine Yahoo’s messenger, search engine, email and advertising tools with the company’s AOL branch.
Yahoo’s share price jumped from a close of $41.68 to $42.25 in the after-hours on Tuesday following its 4 p.m. earnings announcement.