A few days ago, the world was made aware of the Panama Papers. The documents expose people creating huge tax havens. Now there are documents out there called the Yahoo Books. They expose Yahoo’s dire economic situation.
This book is given to potential buyers to help them make a bid. I’ve reported before that Yahoo, one of the Internet’s first companies, was in a downward spiral. This book shows just how bad things are. According to this book, Yahoo’s revenue is down 15%. Their earnings are down 20%. The cash flow is drying up. So is their labor force. In December 2014, their roster consisted of 12,500 employees. By December 2015, it was 10,500. By December 2016, the roster is expected at 9,000. Yet CEO Marissa Mayer is paying her top exec and assistants double, just to keep them from leaving. Now, another $200 million vanished thanks to failed dealings with China’s Alibaba group. The future isn’t looking bright. In 2017, Yahoo expects to lose another $120 million due to another bad business deal from Japan. I’m no mathematician or anything, but some articles say Yahoo is buying revenue from companies like Mozilla and Oracle. We’re talking hundreds of millions of dollars worth. Buyers are asking questions about Tumblr, sales declines, and media unit cuts. These are questions no Yahoo exec entertains, and the first bids for Yahoo are due Monday.
From where I’m sitting, Yahoo reminds me of what used to be the best house in town, the house everyone went to, the house you knew you’d get treated right. Years later, you walk by and see that house in shambles. It’s barely staying upright. The homeowners are trying to repair the house, hoping it would stay afloat. But every repair they make seems to make things worse. Now, there’s no other choice but to get someone to buy the house. But it’s so bad that even buyers are weary of acquiring it. Would you invest in this Yahoo house?