Yahoo's better than expected
first-quarter
results will not help it fight off Microsoft's
hostile
takeover bid, experts reported today.
"This first-quarter performance was neither too hot nor too cold, and that
has probably set the scene for a prolonged battle for Microsoft in its bid to
takeover Yahoo," said Aleksandra Bosnjak, lead analyst at StrategyEye Digital
Media.
"By delivering earnings and revenue that surpassed market estimates, Yahoo
added more uncertainty in terms of finding the right acquisition price."
Microsoft's initial bid was $44.6bn or $31 per share. However, in evaluating
any performance, Bosnjak believes that "measuring more is easy but measuring
better is hard".
"In Yahoo's case, the growth in the first quarter is not organic and comes
from Alibaba, its Chinese investment, which is why Chinese philosophy comes to
mind," she said.
"It is all about establishing harmonious relationships, and finding a balance
between the present and the future."
It is all about finding a balance between the present and the future
Aleksandra Bosnjak StrategyEye Digital Media
Bosnjak noted that, after two months of talks, Yahoo and Microsoft need to
find their own compromise to end the negotiating stalemate.
"Regardless of its earnings results, Yahoo is in a position of weakness and
it will have to get in bed with somebody," Bosnjak added.
"It is in Yahoo's interest to resolve this bid as soon as possible since
failing to find a solution means, ultimately, no progress.
"In addition, there are pressures on Microsoft and Yahoo to combat Google,
which is now far better positioned in every single aspect of online competition
than either of them."
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