Yahoo had a disappointing second quarter, the company said Tuesday, with revenue of $1.084 billion, down from $1.135 billion a year ago.
Marissa Mayer, the ex-Google superstar who joined Yahoo as CEO in July 2012 to try and revive the company, said she wasn't happy with the results.
"While several areas showed strength, their growth was offset by declines," she said in a release. Yahoo Search had a strong quarter, she says, growing 6% year-over-year.
"However, display remains an area of investment and transition," Mayer adds. Yahoo's display revenue declined, "further highlighting the fact that we need to work faster to ameliorate the negative trends. I believe we can and will do better moving forward."
Yahoo earned $270 million, or 26 cents per share, in the quarter, down from $331 million, or 30 cents per share, in the same period a year earlier. Adjusted earnings were 37 cents per share.
The tech giant's share of the $140 billion digital ad market will fall from 2.86% in 2013 to 2.52% this year, projects eMarketer. Google dominates the market, with 31.45%, says eMarketer.
Yahoo has been trying to bounce back with advertisers via high-profile talent deals (Katie Couric is Yahoo's chief anchor) and reviving TV shows (NBC's canceled Community).
In a conference call with analysts, Mayer said she was focused on "transforming" Yahoo, but it's a long-term play. "We believe a transformation of this size and scale will take multiple years."
Investors wanted to know how Yahoo would handle its 22% investment in Chinese internet giant Alibaba, which is expected to begin selling shares in August.
Yahoo said it would sell 6% of its investment, a move Scott Kessler, an analyst with S&P Capital IQ, applauds. Investors wanted Yahoo to keep a large chunk, so they can "participate in the upside," of an IPO. The small percentage "makes people feel good."
Contributing: The Associated Press
Lionel Cironneau, AP