Yahoo!'s Mixed Bag of Tricks: Fool by Numbers

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On July 17, Motley Fool Stock Advisor pick Yahoo! (Nasdaq: YHOO) released second-quarter earnings for the period ended June 30.

• For Internet giant Yahoo!, it's never strictly numbers. Gain insight into the company's business operations with our Foolish take.
• Revenues increased by 7.7% to $1.7 billion, thanks to strong performance from the company's owned and operated sites.
• While domestic revenues increased only 5%, the international segment saw 15% growth year over year.
• Excluding traffic acquisition costs, Yahoo! lowered its fiscal year revenue guidance from between $4.95 billion and $5.45 billion, to between $4.89 billion and $5.19 billion.
• Yahoo! is a two-star stock in CAPS, our free interactive stock database. The other two Internet detectives -- Google (Nasdaq: GOOG) and Microsoft (Nasdaq: MSFT) -- also perch on two stars.

(Figures in millions, except per-share data.)

Income Statement Highlights

	Q2 2007	Q2 2006	Change
Sales	$1,697.9	$1,575.9	7.7%
Net Profit	$160.6	$164.3	(2.3%)
EPS	$0.11	$0.11	0%
Diluted Shares	1,403.8	1,476.6	(4.9%)

Get back to basics with the income statement.

Margin Checkup

	Q2 2007	Q2 2006	Change*
Gross Margin	59.8%	59%	0.8
Operating Margin	10.9%	14.6%	(3.7)
Net Margin	9.5%	10.4%	(1.0)

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets	Q2 2007	Q2 2006	Change
Cash + ST Invest.	$2,391.1	$2,688.6	(11.1%)
Accounts Rec.	$891.6	$792.5	12.5%
Inventory	N/A	N/A	N/A

Liabilities	Q2 2007	Q2 2006	Change
Accounts Payable	$142.6	$139.4	2.3%
Long-Term Debt	$749.6	$750.0	(0%)

The balance sheet reflects the company's health.

Cash Flow Highlights

	Q2 2007	Q2 2006	Change
Cash From Ops.	$405.6	$429.7	(5.6%)
Capital Expenditures	$144.7	$175.1	(17.4%)
Free Cash Flow	$260.9	$254.6	2.5%

Free cash flow is a Fool's best friend.

Related Foolishness:

• Flickr of Hope at Yahoo!
• Three Giants, One Market, No Mercy

Yahoo! is a Motley Fool Stock Advisor recommendation. Microsoft is a Motley Fool Inside Value pick. Grab a free 30- day trial of either newsletter to begin your search for great investing opportunities.

Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean. This data has been provided by Netscribes. To provide feedback on this article, please click on the "feedback" button below.