Troubled Internet pioneer Yahoo! swung to a quarterly loss on Tuesday because of severance pay and write downs on its European properties.
Despite recording a $303 million loss in the fourth quarter, the company's results beat expectations as its revenues and operating profit held up well in the dire economic climate.
The Silicon Valley company, which is struggling to compete with Google and Microsoft in its Internet advertising core business, recorded revenue of $1.8 billion in the three-month period, compared to $1.83 billion in the year-ago quarter. The company's loss of $303 million compared to a profit of $206 million last year, and included a $108 million restructuring charge related to layoffs and a $238 million goodwill impairment charge.
Yahoo! said it expects first-quarter gross sales in the range of $1.52 billion to $1.72 billion, which would be down from $1.82 billion in the first quarter of 2008. The company declined to offer full-year earnings guidance due to uncertain economic conditions.
"We have work to do, but I am excited by Yahoo!'s opportunities and encouraged by the tremendous innovation and momentum I've seen since joining the company as CEO," Chief Executive Carol Bartz said in a statement.
Tuesday's results were the first since she took over from Yahoo! co-founder Jerry Yang, who was widely panned for rejecting a lucrative takeover offer last year from software giant Microsoft.
The two companies are now seen as likely to revive a smaller deal, which could see Yahoo! sell its search business to Microsoft. Bartz refused to be drawn on the likelihood of such an arrangement.
"It is my job to make sure that as a company we look at anything that makes sense long term for the company and creates shareholder value," Bartz said on Tuesday in a conference call with analysts. "So, yes, everything is on the table. But this is not a company that needs to be pulled apart and left for the chickens."