Yahoo's second quarter on target; outlook light

Yahoo reported second quarter earnings of 11 cents a share on revenue of $1.24 billion, a tally that was in line with Wall Street's expectations. But the outlook for the next quarter and year looks light.

Yahoo projected third quarter revenue of $1.17 billion to $1.2 billion. For the year, Yahoo projected revenue of $4.89 billion to $5.19 billion. According to Thomson Financial, Yahoo is expected to report third quarter results of 13 cents a share on revenue of $1.29 billion. For the year Yahoo is expected to report earnings of 49 cents a share on revenue of $5.18 billion. This outlook isn't surprising and most analysts were expecting guidance to be cut.

CEO Jerry Yang said in a statement:

"I am focused on doing everything we need to do to strengthen our business, capture long-term growth opportunities and create increased value for our shareholders. By sharpening our focus, speeding execution, building our technology and talent, and investing in key growth areas, we can put Yahoo! on a clear path to fulfill its potential as an Internet leader."

By the numbers:

• Operating income for the second quarter was $185 million, down 19 percent from a year ago. Net income was $161 million, or 11 cents a share.
• Cash flow from operating activities in the quarter was down 6 percent from a year ago to $474 million.
• The revenue tally including traffic acquisition costs was $1.7 billion. On that basis, Yahoo's U.S. revenue was $1.2 billion, up 5 percent from a year ago. International revenue was $579 million, up 15 percent.