Timothy Koogle, Yahoo’s chief, resigned yesterday amid warnings that the companys sales would fall far below its pessimistic prediction for the first quarter.
In a conference call late Wednesday, the Santa Clara, CA-based Internet communications company said it now expects first-quarter pro-forma EBITDA and net income to be approximately break-even. Yahoo said it anticipates its first-quarter 2001 revenue to be in the range of $170 million to $180 million. At the end of last year, analysts had expected yahoo to report $320 million in sales for the quarter, according to the New York Times. A year ago, Yahoo posted revenue of $228.4 million.
Yahoo said in a statement that its revised guidance for the quarter is primarily the result of the “weakening macroeconomic climate and the resulting shortfall in marketing spending by customers.” Also affecting expectations is the fact that the Yahoo customer base is transforming from pureplay Internet businesses to more traditional companies faster than expected, the company said.
After the announcement, company shares dropped 6% in initial trading, falling $1.38 to $2.
Yahoo also said it has begun searching for a new CEO. Koogle, will remain in his position until a successor is found and will remain as the company’s chairman.
The Yahoo board has authorized a stock repurchase program. Yahoo may acquire up to $500 million of its outstanding common stock in the open market from time to time over the next few years. As of March 1, the company had 565 million shares of common stock.
These announcements followed intense speculation Wednesday afternoon about what move the ailing company planned to make. Trading on Yahoo shares on the Nasdaq Stock Market had been halted in an unusual move yesterday after Yahoo’s CFO susan Decker canceled a scheduled appearance. Trading resumed later in the day.
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