If life imitated art, new Yahoo! (NASDAQ:YHOO) CEO Carol Bartz would've walked into last night's earnings conference call like David Caruso in CSI: Miami. She would be surveying the scene and adjusting her shades, delivering a hokey one-liner like:

  • "Call off the search engine, and call in the search party."
  • "2001 called. It wants its income statement back."
  • "It's the dot-com before the storm."

After all, Bartz has nothing to do with Yahoo!'s fourth-quarter report. Her hands are clean. She's just been assigned the case. Her job now is to identify the cadaver and solve the crime.

And don't let the market's favorable reaction to last night's report kid you. There was a crime committed here. It was another lackluster quarter for the sluggish search engine. Revenue before traffic acquisition costs fell by 2% to $1.375 billion, smacked down by a head-scratching 10% decline in international revenue. Free cash flow fell a sharp 34%. Yahoo! posted a loss as a result of one-time hits in severance payments for displaced workers, a goodwill impairment charge, and costs related to last year's fruitless haggling with Microsoft (NASDAQ:MSFT).

The upside in Yahoo!'s report is that it posted an adjusted profit of $0.17 a share once you back away most of the one-time noise. It's a healthier showing than the $0.13 a share that Mr. Market was expecting. It's actually the company's largest non-GAAP profit in two years.

The end result doesn't excuse the company from the fact that it once again lost market share -- at least on a revenue basis -- to Google (NASDAQ:GOOG).

Don't cry for Bartz, though. She is going to get a free pass over the next few quarters. Heck, she wasn't even at the company when the current quarter started earlier this month.

She also has all of the ingredients in place to make a difference.

  • Expectations are low.
  • Yahoo! has $3.5 billion in cash, which it can use to acquire the necessary puzzle pieces or aggressively repurchase stock.
  • Yahoo! has chunky stakes in Yahoo! Japan, China's Alibaba, and South Korea's Gmarket (NASDAQ:GMKT) that can be cashed in or spun off to increase shareholder value.

So take your time on the crime scene investigation, Bartz. Just don't wait for the body to get too cold, because ineffective CEOs have a limited shelf life at Yahoo!.

The world according to Yahoo!:

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Longtime Fool contributor Rick Munarriz thinks that Microhoo will inevitably happen before the end credits roll. He does not own shares in any of the stocks in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.