Cost-cutting results Yahoo triple in profits

Yahoo said net profit surpassed analysts' forecasts, soaring more than 244 per cent in the third quarter to $186 million, or 13 cents per share, from $54m, or four cents per share over the same period a year ago.

Financial analysts had been expecting earnings of only seven cents per share for the quarter which ended September 30 and revenue of $1.12 billion for Yahoo. But the company said that it expected fourth-quarter revenue of between $1.6 billion and $1.7 billion.

The unexpected performance by the company is the result of aggressive cost-saving tactics employed by Carol Bartz, who replaced Jerry Yang in January as Yahoo's chief executive.

Among Bartz's finest moves include the sale of Hong Kong-listed e-commerce company Alibaba.com and the forging of a 10-year advertising partnership with Microsoft to battle internet rival Google.

The company also reduced its headcount by some 2000 during the past year and presently has some 13,200 employees.

Overall search advertising revenue, however, fell 19 percent in the third quarter while display advertising revenue was down eight percent.

"Our efforts to reposition Yahoo are still in the early stages, but we're confident that our investments in the business will enable us to capitalize on growth opportunities as the economy recovers. We still believe we can close in early 2010," Yahoo chief financial officer Tim Morse said.

"We'll continue to innovate in the search experience," he said, "without spending the billions needed to keep up."