Carol Bartz cautious on Yahoo financial returns

Yahoo's chief executive has urged patience and caution following mixed financial reports from the company.

Carol Bartz said in a call with analysts that Yahoo is still working to reinvent itself and realise the full advantages of its ongoing remodelling.

"First you walk, then you run, then you fly," she said. "Once we get the right things in place, we can really fly."

Yahoo reported an 80 per cent rise in income from operations compared to the same quarter in 2009, but saw revenues increase by just two per cent.

Display advertising revenues rose 17 per cent on the quarter, but search advertising revenues fell seven per cent, a drop credited in part to the company's transition to Microsoft's Bing search platform.

Bartz remained optimistic about Yahoo's chances in the coming months and years, noting the opening of a new datacentre in New York along with larger projects to overhaul core services and platforms as well as the Microsoft integration.

The result, according to Bartz, will be a Yahoo platform better equipped to serve advertisers and extend its social media and web application offerings.

"To do a blogging event was an extremely hard engineering feat," Bartz said of Yahoo's old platform. "You just can't have that if you are trying to move with the marketplace."

Yahoo expects to log between $1.125bn and $1.225bn (£716m and £780m) of revenue over the coming quarter, with $30m (£19m) going to Microsoft as part of a revenue sharing deal. Total operating income is forecast to be $200m to $280m (£127m to £178m).

Bartz would not comment on rumours of a possible buyout from suitors including AOL and News Corp.