(MoneyWatch) Yahoo (YHOO) announced second-quarter earnings of $331 million, a 46 percent jump, aided by its operations in Asia, a number that was better than Wall Street had predicted.
Revenues came in at $1.135 billion, down 7 percent year over year and less than analysts had expected.
In after-hours trading, Yahoo shares were down slightly. Lack of revenue growth has been the bane of the company for years, and these latest earnings suggest the problem continues. In addition, other numbers also offer discouraging news.
As Don Reisinger pointed out on CNET, Marissa Mayer was appointed to her post one year ago today. In that time, the stock has risen almost 75 percent to more than $27 a share.
However, the biggest problem Yahoo has faced is lack of growth. While cost cutting can push up profits, revenue is the real metric for the company, and a 7 percent drop suggests that advertisers haven't warmed to Mayer's attempts to revivify the company, including the purchase of blogging site Tumblr.
Mayer said she was encouraged by Tuesday's numbers.
Income from operations was up 150 percent, from $55 million to $137 million, but in the second quarter last year, Yahoo took a restructuring charge of $129 million. Adding that number back in would have made last year's income from operations higher, and that is with a 9 percent year-over-year drop in the number of employees.
Display ad sales, a critical category for Yahoo because it goes to the heart of how the company makes money, were down 11 percent year over year. The number of ad sales was down 2 percent and the price per ad down 12 percent.
Yahoo has been a company in a rut for years. It has replaced several CEOs in an attempt to find someone who can return the company to the growth it enjoyed early on. Mayer will need to break the mold if she expects to remain at the helm for long.