Yahoo! Inc.

Q1’11 Financial Highlights 4.19.2011

This presentation contains forward-looking statements that involve risks and uncertainties concerning Yahoo!’s expected financial performance, and expected reimbursements from Microsoft Corporation (“Microsoft”), as well as Yahoo!’s long-term financial objectives and strategic and operational plans. Actual results may differ materially from the results predicted, and reported results should not be considered as an indication of future performance. The potential risks and uncertainties include, among others, the impact of management and organizational changes; the implementation and results of Yahoo!'s ongoing strategic and cost initiatives; Yahoo!'s ability to compete with new or existing competitors; reduction in spending by, or loss of, advertising customers; the demand by customers for Yahoo!'s premium services; interruptions or delays in the provision of our services; security breaches; acceptance by users of new products and services; risks related to joint ventures and the integration of acquisitions; risks related to Yahoo!'s international operations; failure to manage growth and diversification; adverse results in litigation, including intellectual property infringement claims; Yahoo!'s ability to protect its intellectual property and the value of its brands; dependence on key personnel; dependence on third parties for technology, services, content, and distribution; general economic conditions and changes in economic conditions; and transition and implementation risks associated with the Search and Advertising Services and Sales Agreement between Yahoo! and Microsoft (the “Search Agreement”). Yahoo!’s long-term financial objectives are necessarily based upon a variety of estimates and assumptions which may not be realized and, in addition to the risks identified above, are inherently subject to business, economic, competitive, industry, regulatory, market, and financial uncertainties, many of which are beyond Yahoo!’s control. There can be no assurance that the assumptions made in preparing the long-term financial objectives will prove accurate, and Yahoo!’s longterm financial objectives may not be achieved. All information in this presentation is as of April 19, 2011. Yahoo! does not intend, and undertakes no duty, to update this information to reflect subsequent events or circumstances; however, Yahoo! may update its business outlook, or any portion thereof, at any time in its discretion. More information about potential risk factors that could affect Yahoo!’s business and financial results is included in Yahoo!’s filings with the Securities and Exchange Commission (“SEC”) including its Annual Report on Form 10-K for the year ended December 31, 2010, which is available on the SEC’s web site at www.sec.gov.

Throughout this presentation, we have rounded numbers as appropriate. In this presentation, “year to date” (or YTD) refers to the three months ended March 31; “year-over-year” (or YOY) refers to the change from the corresponding period in the prior fiscal year to the specified period in the specified year; and “quarter-over-quarter” (or QOQ) refers to the change from the immediately preceding fiscal quarter to the specified quarter.

We periodically review and refine our methodology for monitoring, gathering, and counting Page views to more accurately reflect the total number of Web pages viewed by users on Yahoo! properties. Based on this process, from time to time we update our methodology to exclude from the count of Page views interactions with our servers that we determine or believe are not the result of user visits to Yahoo! Properties.

Yahoo! and the Yahoo! logos are trademarks and/or registered trademarks of Yahoo! Inc. All other names are trademarks and/or registered trademarks of their respective owners.

2

Definitions and Non-GAAP Financial Measures
This presentation includes the following non-GAAP financial measures: - Revenue ex-TAC is defined as GAAP Revenue less Traffic acquisition costs (TAC). TAC consists of payments to Affiliates and payments made to companies that direct consumer and business traffic to Yahoo! Properties. - Display revenue ex-TAC is defined as GAAP Display revenue less Display TAC. Search revenue ex-TAC is defined as GAAP Search revenue less Search TAC. Other revenue ex-TAC is defined as GAAP Other revenue less Other TAC. - Total expenses less TAC is defined as Total expenses (GAAP Cost of revenue plus GAAP Total operating expenses) less TAC. - Free cash flow is defined as Cash flow from operating activities (adjusted to include Excess tax benefits from stock-based awards), less Acquisition of property and equipment, net and Dividends received from equity investees. - Non-GAAP income from operations is defined as income from operations excluding certain gains, losses, and expenses that we do not believe are indicative of our ongoing operating results. - Non-GAAP net income is defined as net income attributable to Yahoo! Inc. excluding certain gains, losses, expenses, and their related tax effects that we do not believe are indicative of our ongoing results. Please refer to the Appendix for reconciliations of these non-GAAP financial measures to the GAAP financial measures the Company considers most comparable.

In addition, certain margin information is presented on a non-GAAP basis: - Operating margin ex-TAC is calculated as Operating income divided by Revenue ex-TAC; and - Net margin ex-TAC is calculated as Net income attributable to Yahoo! Inc. divided by Revenue ex-TAC. Please refer to the Appendix for presentations of the most comparable margins calculated on a GAAP basis.

Return on invested capital (ROIC) is calculated as: (Operating income x (1- Effective tax rate))/(average Stockholder’s equity + average Net debt – average Investments in equity interests), where the average of such items is calculated as the average of the amounts at the beginning and ending of the 12-month period. Effective tax rate for the period is calculated as (Provision for income taxes)/(Income before income taxes and earnings in equity interests). Net debt is calculated as (Total debt) – ((Cash & cash equivalents) + (Short term and Long term marketable debt securities)).

Please refer to the Company’s earnings release for definitions of other terms appearing in this presentation, and for more information regarding the Company’s non-GAAP financial measures.

3

Key Takeaways
 Revenue ex-TAC of $1,064 million was above the midpoint of our guidance and consensus.  Operating income of $190 million, was 31% above the midpoint of our guidance and 29% ahead of consensus.  Display revenue ex-TAC grew 10%, the fifth quarter in a row of double-digit growth. On an underlying basis, Display revenue ex-TAC grew 17%.  Yahoo! users were up 15% in Q1, page views on our media properties were up 8%.

4

Financials and Key Metrics at a Glance
$ in millions, except per share amounts GAAP Revenue Revenue ex-TAC Operating income Operating margin ex-TAC Q1’10 $1,597 $1,130 $188 17% Q1’11 $1,214 $1,064 $190 18% YOY (24%) (6%) 1% +120bps

Net income attributable to Yahoo! Inc.
Net margin ex-TAC EPS attributable to Yahoo! Inc. – diluted ROIC – last 12 months Ending employees

$310
27% $0.22 7.5% 14,200

$223
21% $0.17 12.4% 13,300

(28%)
-650bps (23%) +490bps (6%)

5

Engagement Metrics
YOY Growth Unique visitors Worldwide visitors to Yahoo!-branded sites (1) Worldwide visitors to Yahoo! Properties (2) Page views (3) Communications & communities Media properties Search Minutes (2) (4) Communications & communities Media properties Search queries (5) US Core search -10% 2% 30% 34% 26% -27% -8% -27% -1% -27% 11% -26% 5% -10% 17% 4% -6% -4% -2% -8% -4% -4% -5% -1% -2% -2% 6% -6% 8% 3% 1% 2% 5% 4% 5% 6% 5% 6% 13% 15% Q1’10 Q2’10 Q3’10 Q4’10 Q1’11

Source: (1) Source: comScore. (2) Derived from comScore data, excludes visitors from China and Japan where Yahoo!-branded sites are operated by third-party licensees. (3) Source: internal data from Yahoo! Properties. “Communications & communities” primarily includes Mail, Login/Registration, Wretch, Flickr and Groups. “Media Properties” primarily includes Homepage, Mobile Web and apps (excluding IMAP mail and SMS), News, Sports, Finance, and Entertainment, as well as Local, Marketplaces and other properties. “Search” page views are Web pages viewed by users on Yahoo! Properties resulting from search queries. (4) Reflects Yahoo!’s minutes in standard comScore categories (other than Search) grouped into Communications & Communities and Media Properties. (5) Source: comScore Core Search (US only). Note: For Unique visitors, year-over-year growth presents change in average monthly comScore amounts during the period. Commencing in May 2010, Yahoo! Properties began transitioning from comScore’s panel-only methodology to comScore’s unified methodology; YOY comparisons of Unique visitors and Minutes spanning such date include growth attributable to the change in methodology.

6

Revenue ex-TAC Trends
Revenue ex-TAC Microsoft's 12% Revenue Share
Begin Rev Share with MSFT $1,237(1) $1,205 $1,050 Q1’11 HEADWINDS
YOY growth in Revenue exTAC was negatively impacted in Q1’11 by:

$ in millions

$1,130

$1,128

$1,124 $1,100(1) $1,064

1) $36M from MSFT’s 12% rev share, 2) $27M from step-downs in broadband deferred revenue amortization and certain fee rates and the impact of divested business lines. Adjusting for these headwinds, Revenue ex-TAC would have been flat in Q1’11 vs. Q1’10.

Q1'10
GAAP Revenue :
(1)

Q2'10
$1,601

Q3'10
$1,601

Q4'10
$1,525

Q1'11
$1,214

$1,597

Revenue ex-TAC including Microsoft’s 12% revenue share of $36 million and $32 million is presented for Q1’11 and Q4’10, respectively, to provide comparable results as if we had not shared any revenue with Microsoft. Please refer to slide 14 for more detailed information.

7

Revenue ex-TAC by Source
$ in millions Display revenue ex-TAC Q1’10 $427 Q2’10 $445 Q3’10 $448 Q4’10 $567 Q1’11 $471

YOY Growth

18%

17%

17%

16%

10% (1)

Search revenue ex-TAC YOY Growth

$440 (11%)

$438 (4%)

$428 (5%)

$388 (18%)

$357 (19%) (2)

Other revenue ex-TAC YOY Growth

$263 (12%)

$245 (19%)

$248 (16%)

$250 (15%)

$237 (10%)

Total revenue ex-TAC YOY Growth
(1) (2)

$1,130 (2%)

$1,128 (1%)

$1,124 (1%)

$1,205 (4%)

$1,064 (6%) (1)(2)

YOY Growth in Display revenue ex-TAC and Total revenue ex-TAC were negatively impacted by a one-time benefit in Q1’10 from transitioning some large customers from cash-basis accounting to accrual accounting. YOY Growth in Search revenue ex-TAC and Total revenue ex-TAC were negatively impacted in Q1’11 by $36M and $63M in headwinds, respectively.

8

Geographic Segment Data
$ in millions Americas Revenue ex-TAC Direct costs(1) Contribution Americas contribution margin(2) EMEA Revenue ex-TAC Direct costs(1) Contribution EMEA contribution margin(2) Asia Pacific Segment Revenue ex-TAC Direct costs(1) $169 (34) $187 (45) 11% 29% $88 (31) $58 65% $97 (31) $66 68% 9% (1%) 14% 300bps $873 (145) $728 83% $781 (136) $645 83% (11%) (6%) (11%) 0bps Q1’10 Q1’11 YOY

Contribution
Asia Pacific contribution margin(2)
(1) (2)

$134
80%

$142
76%

6%
(400bps)

Direct costs for each segment include cost of revenue (excluding TAC) and other operating expenses that are directly attributable to the segment. Contribution margin is calculated as Contribution divided by Revenue ex-TAC for each segment.

9

Total Expenses less TAC
Depreciation, Amortization, and Stock-based compensation
$942(1) $953 $985 $935 $875

$ in millions

Q1'10
(1)

Q2'10

Q3'10

Q4'10

Q1'11

Total expenses less TAC for Q1’10 includes $43 million of net transition cost reimbursements from Microsoft.

10

Operating Income
Net transition cost reimbursements from Microsoft
$220 $188(1) $175 $189 $190

$ in millions

Q1'10
Op. margin ex-TAC :
(1)

Q2'10
16%

Q3'10
17%

Q4'10
18%

Q1'11
18%

17%

Operating income for Q1’10 includes $43 million of net transition cost reimbursements from Microsoft. See Appendix Table 5 for presentation of Non-GAAP Operating income.

11

Key Balance Sheet Metrics
$ in millions Q1’10 Q2’10 Q3’10 Q4’10 Q1’11

Cash & marketable debt securities (1)

$4,244

$3,799

$3,455

$3,629

$3,528

Accounts receivable, net

$900

$922

$939

$1,029

$933

Current deferred revenue Market value of 35% ownership in Yahoo Japan (at 3/31/11) (2) Market value of 29% ownership in Alibaba.com (at 3/31/11) (2)(3)

$352

$347

$314

$255

$247

$7,322

$2,545

(1) (2) (3)

Cash & marketable debt securities is comprised of Cash and cash equivalents, Short-term marketable debt securities, and Long-term marketable debt securities. These pre-tax market values are based on public market share prices for Yahoo Japan and Alibaba.com on March 31, 2011. Yahoo!’s 29% stake in Alibaba.com is held indirectly through its equity interest in Alibaba Group, and the market value presented above does not include estimates for the values of Alibaba Group’s privately held businesses.

12

Key Cash Flow Highlights
$ in millions Q1’10 Q2’10 Q3’10 Q4’10 Q1’11

Share repurchases

$385

$496

$868

$0

$137

Net cash provided by operating activities

(1)

$144

$347

$346

$403

$208

Acquisition of property and equipment, net

$113

$190

$164

$247

$168

Free cash flow (1)

$64

$127

$250

$155

$59

(1)

Microsoft search operating cost reimbursements and transition cost reimbursements were recognized on the income statement, but not yet received as cash in Q1’10.

13

Example – Impact of change in GAAP revenue presentation and revenue share related to Search Alliance (1)
Pre-Search Alliance Transition GAAP Revenue Presentation – “Gross” basis
Yahoo! Properties Affiliate (70% TAC)

Post-Search Alliance Transition GAAP Revenue Presentation – “Net” basis Yahoo! Properties
Search transactions in AdCenter(2) Less: TAC Less: 12% MSFT revenue share(3) $100 ($5)

Total

Affiliate (70% TAC)
$100 ($70)

Total

GAAP Revenue Less: TAC

$100 ($5)

$100 ($70)

$200 ($75)

$200 ($75)

($11)

($4)

($15)

Revenue ex-TAC

$95

$30

$125

GAAP Revenue

$84

$26

$110

(1) (2) (3)

The numbers presented in this slide are for illustration purposes only and do not reflect actual amounts or actual average TAC rates. Represents dollar value of search transactions in Microsoft’s AdCenter platform attributed to Yahoo! Properties and Affiliate sites. Under the Search Agreement, Yahoo! is entitled to an 88% post-TAC revenue share and Microsoft is entitled to a 12% post-TAC revenue share in transitioned markets.

14

Business Outlook
$ in millions Q2’11 Current Outlook $1,075 – 1,125 Revenue ex-TAC

Total expenses less TAC

$915 – 935

Operating income

$160 – 190

Note: The above business outlook is based on information and expectations as of April 19, 2011. Yahoo! does not intend, and undertakes no duty, to update this business outlook to reflect subsequent events or circumstances; however, Yahoo! may update this business outlook or any portion thereof at any time at its discretion.

15

Appendix

Table 1 – Revenue ex-TAC Calculation by Segment
Reconciliations of GAAP Revenue to Revenue ex-TAC
$ in millions Americas GAAP Revenue TAC Revenue ex-TAC EMEA $1,155 (282) $873 $1,133 (282) $851 $1,147 (292) $855 $991 (102) $889 $819 (38) $781 Q1’10 Q2’10 Q3’10 Q4’10 Q1’11

GAAP Revenue
TAC Revenue ex-TAC Asia Pacific GAAP Revenue

$142
(53) $88

$141
(50) $90

$133
(49) $84

$164
(58) $106

$154
(58) $97

$300

$328

$322

$371

$241

TAC
Revenue ex-TAC Worldwide GAAP Revenue TAC

(131)
$169

(141)
$187

(136)
$185

(160)
$211

(54)
$187

$1,597 (467)

$1,601 (473)

$1,601 (477)

$1,525 (320)

$1,214 (150)

Revenue ex-TAC

$1,130

$1,128

$1,124

$1,205

$1,064

17

Table 2 – Revenue Details
Reconciliations of GAAP Revenue to Revenue ex-TAC by Source
$ in millions
Display GAAP Display revenue YOY Growth Display TAC Display revenue ex-TAC Search GAAP Search revenue YOY Growth Search TAC $841 (3%) (401) $842 2% (404) $839 1% (410) $640 (27%) (252) $455 (46%) (98) $491 18% (64) $427 $514 16% (70) $445 $514 16% (66) $448 $635 14% (68) $567 $523 6% (52) $471

Q1’10

Q2’10

Q3’10

Q4’10

Q1’11

Search revenue ex-TAC
Other GAAP Other revenue YOY Growth Other TAC Other revenue ex-TAC Total GAAP Revenue YOY Growth TAC Revenue ex-TAC

$440

$438

$428

$388

$357

$265 (12%) (1) $263

$245 (19%) (0) $245

$248 (16%) (0) $248

$250 (16%) (0) $250

$237 (11%) (0) $237

$1,597 1% (467) $1,130

$1,601 2% (473) $1,128

$1,601 2% (477) $1,124

$1,525 (12%) (320) $1,205

$1,214 (24%) (150) $1,064

18

Table 3 – Revenue and Direct Costs by Segment
$ in millions Q1’10 Q1’11

Revenue by segment:
Americas EMEA Asia Pacific Total revenue $1,155 142 300 1,597 $819 154 241 1,214

TAC
Total revenue ex-TAC Direct costs by segment: Americas EMEA

(467)
$1,130

(150)
$1,064

$145 31

$136 31

Asia Pacific
Global operating costs(1) Restructuring charges, net Depreciation and amortization Stock-based compensation

34
502 4 165 61

45
458 11 160 35

Income from operations
(1)

$188

$190

Global operating costs include product development, service engineering and operations, marketing, customer advocacy, general and administrative, and other corporate expenses that are managed on a global basis and that are not directly attributable to any particular segment.

19

Table 4 – Total Expenses
Reconciliations of Total Expenses to Total Expenses less TAC
$ in millions Total expenses less TAC: Q1’10 Q2’10 Q3’10 Q4’10 Q1’11

Total expenses

$1,409

$1,426

$1,412

$1,305

$1,025

Less: Traffic acquisition costs (“TAC”)

467

473

477

320

150

Total expenses less TAC

$942

$953

$935

$985

$875

20

Table 5 – Non-GAAP Operating Income Calculation
Reconciliation of GAAP Operating Income to Non-GAAP Operating Income, with Details on Adjustments
Quarterly Data
$ in thousands
GAAP Operating income (a) Transition costs, net of reimbursements from Microsoft(1) (b) Incremental costs for advisors related to strategic alternatives and related matters(2) (c) Restructuring charges, net Non-GAAP Operating income GAAP Operating margin Non-GAAP Operating margin(3)

Year Ended
Q4’10
$219,976 –

Q1’10
$188,021 (43,300)

Q2’10
$175,372 –

Q3’10
$189,155 –

Q1’11
$189,745 –

12/31/09
$386,692 43,300

12/31/10
$772,524 (43,300)

7,159

4,412 $149,133 12% 9%

10,052 $185,424 11% 12%

5,758 $194,913 12% 12%

37,735 $257,711 14% 17%

10,575 $200,320 16% 16%

126,901 $564,052 6% 9%

57,957 $787,181 12% 12%

(1) (2) (3)

Non-GAAP Operating income excludes reimbursements for prior periods. The net reimbursement adjustment of $43 million in Q1'10 is equal to the transition costs of $11 million and $32 million incurred in Q3’09 and Q4’09, respectively, in connection with the Search Agreement. Includes incremental costs for advisors related to Microsoft's proposals to acquire all or a part of the Company, other strategic alternatives, including the Google agreement, the proxy contest, and related litigation defense. Non-GAAP Operating margin is calculated as Non-GAAP Operating income divided by GAAP Revenue.

21

Table 6 – Free Cash Flow Calculation
Reconciliation of GAAP Cash Flow from Operating Activities to Free Cash Flow
$ in millions Free cash flow: Q1’10 Q2’10 Q3’10 Q4’10 Q1’11

Cash flow from operating activities Excess tax benefits from stock-based awards Acquisition of property & equipment, net

$144

$347

$346

$403

$208

33

31

68

(1)

18

(113) –

(190)

(164) –

(247) –

(168) –

Dividends received from equity investees

(61)

Free cash flow

$64

$127

$250

$155

$59

22

Table 7 – Non-GAAP Net Income Per Share Calculation
Reconciliation of GAAP Net Income Attributable to Yahoo! Inc. and GAAP Net Income Attributable to Yahoo! Inc. Common Stockholders Per Share – Diluted to Non-GAAP Net Income and Non-GAAP Net Income Per Share – Diluted
$ in millions, except per share amounts GAAP Net income attributable to Yahoo! Inc. Adjustments Non-GAAP Net income GAAP Revenue GAAP Net margin Non-GAAP Net margin(1) GAAP Net income attributable to Yahoo! Inc. common Stockholders per share – diluted Non-GAAP Net income per share – diluted Diluted shares outstanding
(1)

Q1’10 $310 (90) $220 $1,597 19% 14% $0.22 $0.16 1,413

Q2’10 $213 7 $220 $1,601 13% 14% $0.15 $0.16 1,390

Q3’10 $396 (175) $221 $1,601 25% 14% $0.29 $0.16 1,343

Q4’10 $312 29 $341 $1,525 20% 22% $0.24 $0.26 1,312

Q1’11 $223 33 $256 $1,214 18% 21% $0.17 $0.19 1,320

Non-GAAP Net margin is calculated as Non-GAAP Net income divided by GAAP Revenue.

Note: All per share amounts are based on fully diluted share counts. Please refer to Appendix Table 8 for details on Adjustments.

23

Table 8 - Non-GAAP Net Income Calculation
Reconciliation of GAAP Net Income Attributable to Yahoo! Inc. to Non-GAAP Net Income, with Details on Adjustments
$ in thousands GAAP Net income attributable to Yahoo! Inc. (a) Transition costs, net of reimbursements from Microsoft (b) Restructuring charges, net (c) Gain on sale of HotJobs (d) Gain on sale of Zimbra, Inc.
(1)

Q1’10 $310,191 (43,300) 4,412 – (66,130) –

Q2’10 $213,321 – 10,052 – – –

Q3’10 $396,131 – 5,758 (186,345) – –

Q4’10 $312,020 – 37,735 – – –

Q1’11 $222,992 – 10,575

– 25,981

(e) Yahoo!’s Non-cash loss related to impairment of an investment held by Yahoo Japan, net of tax, which is included in earnings in equity interests
(f) To adjust the provision for income taxes to reflect the tax impact of items (a)-(d) Non-GAAP Net income
(1)

14,684 $219,857

(3,271) $220,102

5,223 $220,767

(9,205) $340,550

(3,239) $256,309

Non-GAAP Net income excludes reimbursements for prior periods. The net $43 million reimbursement adjustment in Q1'10 is equal to the transition costs of $11 million and $32 million incurred in Q3’09 and Q4’09, respectively, in connection with the Search Agreement.

24

Table 9 – Business Outlook Reconciliations
Reconciliations of Outlook for GAAP Revenue to Revenue ex-TAC and Total expenses to Total expenses less TAC
$ in millions Revenue ex-TAC: GAAP Revenue (1) Less: TAC (1) Revenue ex-TAC Total expenses less TAC: Total expenses (GAAP Cost of revenue + GAAP Total operating expenses) Less: TAC (1) Total expenses less TAC
(1)

Q2’11 Current Outlook

$1,230 – 1,290 155 – 165 $1,075 – 1,125

$1,070 – 1,100 155 – 165 $915 – 935

As a result of the required change in revenue presentation and the revenue share with Microsoft in transitioned markets, Yahoo!’s Q2’11 business outlook at the midpoint of the ranges for GAAP Revenue and TAC is lower than it otherwise would have been by approximately $220 million and $190 million, respectively.

Note: The above business outlook is based on information and expectations as of April 19, 2011. Yahoo! does not intend, and undertakes no duty, to update the business outlook to reflect subsequent events or circumstances; however, Yahoo! may update the business outlook or any portion thereof at any time at its discretion.

25

Table 10 – Additional Reconciliations
1. YOY Growth in Display revenue ex-TAC adjusted to exclude Q1’10 benefit of transitioning automotive advertisers back to accrual accounting: GAAP Display revenue was $491M in Q1’10 and $523M in Q1’11, an increase of 6%. Excluding Display TAC of $64M in Q1’10 and $52M in Q1’11, and the Q1’10 benefit of transitioning our automotive advertisers back to accrual accounting ($23M), Display revenue ex-TAC (adjusted) in Q1’10 and Q1’11 would have been $404M and $471M, respectively, an increase of 17%. YOY Growth in Operating Income adjusted to exclude Q1’10 net transition cost reimbursements from Microsoft: Q1’10 Operating Income ($188M calculated on a GAAP basis), adjusted to exclude net transition cost reimbursements from MSFT ($43M), was $145M. Q1’11 GAAP Operating Income of $190M represents a 31% increase over such Q1’10 Operating Income (adjusted) of $145M. YOY Growth in Operating Margin ex-TAC adjusted to exclude Q1’10 net transition cost reimbursements from Microsoft: Q1’10 Operating Income ($188M calculated on a GAAP basis), adjusted to exclude net transition cost reimbursements from MSFT ($43M), was $145M, yielding Q1’10 Operating Margin ex-TAC of 13% (calculated as Operating Income (adjusted) of $145M divided by Revenue ex-TAC of $1,130M). Q1’11 Operating Margin ex-TAC of 18% represents a 5 point increase over such Q1’10 Operating Margin ex-TAC (adjusted) of 13%. YOY Growth in EPS adjusted to exclude certain items: GAAP EPS for Q1’11 and Q1’10 were $0.17 and $0.22, respectively, a decrease of 23%. Excluding the impairment charge ($26M, which had a per share impact of -$0.02) in Q1’11, the net transition cost reimbursements from Microsoft ($43M, which had a per share impact of $0.02) in Q1’10 and the gain on sale of Zimbra, Inc. ($66M, which had a per share impact of $0.05) in Q1’10, EPS (adjusted) in Q1’11 and Q1’10 would have been $0.19 and $0.15, respectively, an increase of 23%. YOY Growth in Revenue ex-TAC adjusted to exclude certain items: GAAP Revenue was $1,597M in Q1’10 and $1,214M in Q1’11. Excluding TAC of $467M in Q1’10 and $150M in Q1’11, the revenue share with Microsoft ($36M) in Q1’11 and the impact of divestitures, step-downs in broadband deferred-revenue amortization and certain fee rate reductions (net impact of $27M in Q1’10), Revenue ex-TAC (adjusted) in Q1’10 and Q1’11 would have been $1,103M and $1,100M, respectively, essentially flat yearover-year. 2.

3.

4.

5.

26

Sign up to vote on this title
UsefulNot useful