The Industry Standard - Yahoo! misses Q1 earnings, Microsoft drops bid, then swoops back in - Comments

Man, Tom, you should post

Eric Hill113600 — Mon, 17 Mar 2008 13:29:21 -0700

Man, Tom, you should post that idea as a Suggestion! Really interesting idea.

While this scenario is

Tom C — Thu, 13 Mar 2008 14:43:36 -0700

While this scenario is possible, any activity that would drive the price down will attract other potential buyers - say, Apple, for instance.

That combination would be a rather startling addition to the evolving/future user application market. MS has spent large sums of money on server class products and a failed desktop OS rollout (probably the last in the company history). They want to get into the fight with Google and can't get out of their own way to make a play in the SaaS model world. They can't even come close to catching up with Google unless they leverage all of their horsepower to build a Google-like delivery capability.

Apple could buy their way into that game and shoot past MS. They would immediately have a 2nd place slot behind Google and block MS from quickly getting into that game (translation = MS will have to spend time and money after changing their corporate culture to properly deliver a SaaS user experience).

Apple can leverage the Yahoo engines, the Zimbra (open source) mail engine, and their own BSD based desktop operating system to create a seamless user experience (interface and guts). I would bet many of the Yahoo shareholders would take any offer from Apple over a MS low-ball offer any day of the week.

God Bless Competition! And

Louis Anasinis — Thu, 13 Mar 2008 14:42:48 -0700

God Bless Competition!
And bless also the corporate dominance of companies that not just can... BUT DO ! ! !
Say what anyone will about MS. They are the gorilla and they have eanred it.
MS made a remarkably FAIR bid for Yahoo (which has now become more synomous with the NOUN than the exclamatory!) and their provincial, non-shareholder value positioning, will/has squash/ed the value down to $25 a share. What a corporate mass of boobs! And they truly abandoned their fiduciary role on behalf of shareholders and health of the corporation. It may be that Yahoo will recover and someday become a heavy-weight once again, but business and competition DON'T WORK THAT-A-WAY! It's always about cost of capital... and if there is a management team with a competitive vision that is willing to PAY for something for a flailing company, then the MARKET SAYS, go for it. Do IT!
I hope MS washes Yahoo's collective boards' faces in it when they finally take over the company at perhaps an even more greatly reduced value point than $25.
Lou - Lighthouse/Watersone Consulting

Microsoft takes a dump on

deb walkup — Thu, 13 Mar 2008 13:55:06 -0700

Microsoft takes a dump on the Internet.

I think this is a match made in hell. The cultures are oil and water and Microsoft just doesn't get how the web works. In my mind what they are really doing is wrecking a decent internet company, devaluing their own company and leaving a big stinking pile of pooh on the internet where yahoo used to be. Maybe someday they'll come around to, "If you can't beat them join them." Right now it's the same old style of thinking. Beat them, beat them again and then beat them until they're dead.

Yahoo! misses Q1 earnings, Microsoft drops bid, then swoops back in

The Standard — Wed, 12 Mar 2008 14:02:32 -0700

Looks like the community was right -- today Yahoo! beat expectations. Total revenue for the quarter was $1.8 billion, net revenues were $1.35 billion. Net Income was $542 million, or $0.37 per share. Therefore, the first condition of this prediction has not been met. --The Industry Standard

Henry Blodget, via Kara Swisher, lays out the following possible scenario:

“Microsoft goes about its business until early April--nominating its slate of board members, preparing for a hostile shareholder meeting--and then, just after Yahoo reports a horrendous first quarter, pulls its offer for the company. Yahoo's stock collapses, costing shareholders 40% overnight. Jerry & Co. are pummeled with shareholder complaints and lawsuits, and Yahoo's employee and shareholder morale hit all-time low. Then, just when all hope seems lost, Microsoft comes charging back and saves the day with a $25 bid, and Yahoo owners flatten Jerry & Co. in a stampede to tender their shares.”

This is a prediction that must meet three conditions in order to be judged favorably:

First, Yahoo misses its Q1 earnings estimates.
Second, MSFT withdraws its current bid for Yahoo!
Third, MSFT brings forth a new bid in the $23-27 range.

These conditions do NOT require that Yahoo! actually accept the new bid (although in that case it would seem likely). Above Blodget says that MSFT will “save the day” – but again, the success or lack thereof of the new bid is outside of the scope of this prediction.