Yahoo may increase revenue to fend off Microsoft bid

(Xinhua)
Updated: 2008-03-19 15:40

LOS ANGELES -- Yahoo told its investors Tuesday that the company could increase revenue by more than 50 percent and double cash flow in coming years, in an attempt to justify its earlier rejection of the unsolicited buyout bid from Microsoft.

The Yahoo headquarters in Sunnyvale, California are seen here in this file photo. [Agencies]

The Silicon Valley search engine, in a presentation filed with the US Securities and Exchange Commission, said it is expecting much of its growth from Internet display advertising, including banners and video advertising, as opposed to traditional search advertising.

Yahoo is poised for "accelerated financial growth" in 2009 and 2010, said Chief Executive Jerry Yang in a separate news release, which highlighted the company's key assets of powerful consumer brand, large global audience and profitable business.

Yahoo had been a traditional leader in Internet advertising, but found it struggling to catch up with Google in the area in recent years.

Industry analysts said the company was also losing market shareto other new competitors, such as popular social networking websites like Myspace and Facebook.

In the financial presentation filed with the stock market watchdog, Yahoo said that a merger with Microsoft would move the software giant from sub-scale position to strong position in Internet search and display business.

It also said that Yahoo's stakes in Asian businesses such as AliBaba.com and Yahoo Japan are valuable because "Asia is an important source of growth for Microsoft."

Microsoft announced its 44.6-billion-dollar takeover bid for Yahoo on February 1, but the offer was rejected by Yahoo as it said the price undervalues the company. However, the two companies reportedly met last week to informally discuss a possible merger.