Yahoo 2001 Annual Report Download

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Yahoo! 2001 Annual Report

Table of contents

  • Page 1
    Yahoo! 2001 Annual Report

  • Page 2
    One team. Working in unison. Building a great company. The Internet playing field has changed. And so have the strategies for winning. During 2001, Yahoo! rose to the challenge, aligning the right businesses, the right structure and the right people to drive our long-term growth. In the process, we'...

  • Page 3
    ...agencies and traditional marketers, as well as a sales team that required more depth. In addition, with 44 different business areas and sub-areas, the Company itself was difficult to manage. While Yahoo! had achieved extraordinar y success in its first five years by providing the broadest set of Web...

  • Page 4
    ... a package, in order to increase sales and grow usage across the network. It's also a great way for Yahoo! to provide increased value to our paying customers, both businesses and consumers. In 2001, we star ted to provide bundled por tal and broadcast ser vices to our Enterprise Solutions customers...

  • Page 5
    ... 2000. During 2001, our transition in customer base from pure play One goal. Your success. Passionately delivered. A lot has been written about Internet adver tising in the past year. Unfor tunately, a lot of it has been wrong. Because while it's true that demand for conventional buttons and banner...

  • Page 6
    ... and increase the efficiency of its PepsiStuf f customer loyalty program and under taking highly visible branding programs on the Yahoo! network. > Working with Nestlé Purina PetCare Company to create Purina TV, a single source multi-media site that provides pet care information in streamed video...

  • Page 7
    ... more than 22% over year-end 2000 . Page views increased 47% from 900 million per day in December 2000 to more than 1.3 billion per day in December 2001. > In Februar y 2002, Nielsen // Net Ratings ranked Yahoo! as the No. 1 desti- nation on the Internet for the 21st straight month, recognizing...

  • Page 8
    ...a "for-pay" business, with excellent results. In 2002, we plan to aggressively pursue multiple-listing adver tisers - such as auto dealers and real estate agents - with a variety of cost-effective solutions, including some bundled ser vices. Working with the top Yellow Pages adver tising agencies in...

  • Page 9
    ... long-term profits. The nation's No. 1 DSL provider. In November 2001, we announced the first of our initiatives to enter the broadband access market through a strategic alliance with SBC Communications Inc., the nation's leading DSL Internet provider. In 2002, Yahoo! and SBC will launch for-pay, co...

  • Page 10
    ... business traveler, bringing together the best travel information and ser vice providers in one place. Throughout 2001, Yahoo! Travel developed new product features, direct marketing programs and personalized ser vices to provide one-stop access to its network of 700 airlines, 50 car rental agencies...

  • Page 11
    ... the sale of for-pay ser vices, such as for-pay mail ser vices and advanced, for-pay Web hosting ser vices to complement our existing suite of Yahoo! Sherr y Willhoite Producer Yahoo! Personals GeoCities' Web hosting packages. In 2001, Yahoo! Communications transformed Yahoo! Personals from a free...

  • Page 12
    ...! Finance offers consumers and businesses a wide variety of ser vices to help them manage their finances, including for-pay ser vices such as Yahoo! Bill Pay and Yahoo! PayDirect, safe and convenient ways to manage bills and make payments online. During 2001, Yahoo! also introduced Money Manager...

  • Page 13
    ... help our high-volume clients broadcast hundreds of events with even greater ease and cost efficiency. We provide small business services to small- and medium-sized businesses (SMBs) looking to create a Web presence, sell online and promote their products and ser vices. Yahoo! has cultivated billing...

  • Page 14
    ... balance shor t-term profitability and long-term growth. As we work to better monetize our vast and loyal user base, we will be adding incremental revenue streams, leaving us better diversified in our business mix and financial exposure. Despite difficult economic conditions throughout 2001, we made...

  • Page 15
    ... stock compensation expenses and restructuring charges. 569,724 550,657 516,237 440,131 391,542 569,724 610,678 599,558 440,131 391,542 December 31, 2001 2000 1999 1998 1997 Cash, cash equivalents and investments in marketable debt securities Restricted cash and restricted long-term...

  • Page 16
    ... worldwide. Through Yahoo! Enterprise Solutions, we also provide online business and enterprise ser vices designed to enhance the productivity and Web presence of our clients. Our global Web network includes 24 world properties. Headquartered in Sunnyvale, California, we have offices in the United...

  • Page 17
    ...provide. These ser vices primarily include Small Business Ser vices, Yahoo! Por tal Solutions, broadcasting live and on-demand events, Yahoo! Personals, and cer tain Search and Director y ser vices. Fees and listings revenues in 2001 increased $24.0 million, or 20%, as compared to 2000. The increase...

  • Page 18
    ... 2000, these costs related primarily to the acquisition of eGroups. During 1999, these costs related to the acquisitions of Encompass, GeoCities, Online Anywhere, broadcast.com, ONElist, Inc., Log-Me-On, and ISSG. Due to the elimination of the pooling-of-interests method of accounting for business...

  • Page 19
    ... as we invested in our international operations. Acquisitions In Januar y 2001, we completed the acquisition of Kimo.com, a Taiwanese Internet communications and media company, for a total purchase price of $157.4 million. During 2001, we also acquired other companies, for an aggregate purchase...

  • Page 20
    ... the Financial Statements for fur ther discussion of acquisitions that we have made in 2001, 2000 and 1999. In Februar y 2002, we completed the acquisition of HotJobs.com, Ltd., ("HotJobs"), a leading provider of comprehensive online recruiting solutions for employers, staffing firms and job seekers...

  • Page 21
    .... For 1999, cash provided by financing activities was $284.1 million and was primarily due to proceeds from the issuance of Common Stock pursuant to stock option exercises. Operating Leases. During 1999, we entered into agreements for the development of an office complex in Sunnyvale, California...

  • Page 22
    ... if forced to sell securities which have declined in market value due to changes in interest rates. Rent obligations for our Sunnyvale, California office complex bear a direct relationship to the lessor's carr ying costs of $258.4 million. Our rent expense is based on a floating LIBOR interest rate...

  • Page 23
    ...become marketable equity securities upon the investees completing initial public offerings. Such investments, most of which are in the Internet industr y, are subject to significant fluctuations in fair market value due to the volatility of the stock market, and are recorded as long-term investments...

  • Page 24
    ... sheets Consolidated statements of cash flows December 31, (in thousands, except par value) 2001 2000 Years Ended December 31, (in thousands) 2001 2000 1999 Assets Current assets: Cash and cash equivalents Restricted cash Shor t-term investments in marketable securities Accounts receivable...

  • Page 25
    ... Internet business and consumer ser vices company that offers a comprehensive branded network of properties and ser vices to millions of worldwide users daily. The Company, a Delaware corporation, commenced operations in 1995. Stock Split. The consolidated financial statements for 2000 and 1999...

  • Page 26
    ... 2001, 2000, and 1999. Benefit Plan. The Company maintains a 401(k) Profit Sharing Plan (the "Plan") for its full-time employees. Each par ticipant in the Plan may elect to contribute from 1% to 17% of his or her annual compensation to the Plan. The Company matches employee contributions at a rate...

  • Page 27
    ...-for-sale securities, net of tax, and the cumulative foreign currency translation adjustment. Recent Accounting Pronouncements. In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards No. 141 ("SFAS 141"), "Business Combinations" which...

  • Page 28
    ...(in thousands) Note 3. Investments 2001 2000 The following tables summarize the Company's investments in available-for-sale securities (in thousands): December 31, 2001 Gross Amortized Costs Gross Unrealized Gains Gross Unrealized Losses Estimated Fair Value Proper ty and equipment: Computers and...

  • Page 29
    .... Online Anywhere GeoCities Encompass, Inc. August 31, 2000 Februar y 29, 2000 July 20, 1999 May 28, 1999 May 28, 1999 May 26, 1999 3,425 594 57,294 906 43,281 1,390 2001 Kimo.com Other acquisitions 2000 VivaSmar t, Inc. 1999 Log-Me-On.com LLC Yahoo! Canada Innovative Systems Ser vices Group, Inc...

  • Page 30
    ...! Japan") was formed to establish and manage in Japan a Japanese version of the Yahoo! Internet Guide, develop related Japanese online navigational services, and conduct other related business. The investment in Yahoo! Japan is being accounted for using the equity method. As of December 31, 2001...

  • Page 31
    ... at the rate of one Right for each share of Common Stock held by stockholders of record as of the close of business on March 20, 2001. The Rights Plan was not adopted in response to any effor t to acquire control of the Company. The Rights will expire on March 1, 2011. Stock Repurchase Program. In...

  • Page 32
    ... value method. If the fair value based method had been applied in measuring stock compensation expense, the pro forma effect on net income (loss) and net income (loss) per share would have been as follows (in thousands, except per share amounts): 2001 2000 1999 Range of Exercise Prices Number...

  • Page 33
    ...): 2001 2000 1999 Years Ended December 31, Years Ended December 31, 2001 2000 1999 Net revenues: United States International Total net revenues Segment EBITDA: United States International Total segment EBITDA Corporate and unallocated operating costs and expenses: Stock compensation expense...

  • Page 34
    ... ty rights, and a variety of claims arising in connection with the Company's email, message boards, auction sites, shopping ser vices, and other communications and community features, such as claims alleging defamation or invasion of privacy. Currently, our subsidiar y Launch Media, Inc. ("Launch...

  • Page 35
    ... million of stock options exchanged, and direct transaction costs of approximately $7.0 million. The value of the common stock and stock options was determined based on the average market price of the Company's common stock over the 5-day period before and after the terms of the exchange offer were...

  • Page 36
    ... President, Chief Sales Officer Christine Castro Senior Vice President, Chief Communications Officer James L. Brock Senior Vice President, Access and Distribution Toby R. Coppel Senior Vice President, Corporate Development James A. Fanella Senior Vice President, Enterprise Solutions Geoff Ralston...

  • Page 37
    ... First Avenue Toronto, Ontario M5A 1E1 Canada Yahoo! Latin America 95 Merrick Way, Suite 200 Sunnyvale, CA 94089 Other U.S. Operations 3715 Northside Parkway N.W. Yahoo! Singapore 520 Northbridge Road #05-01 Wisma Alsagoff Coral Gables, FL 33134 U.S.A. Building 300, Suite 800 Atlanta, GA 30327...

  • Page 38
    ...! Italy Sunnyvale, CA 94089 A copy of this annual report can be found online at: http://www.yahoo.com/info/investor Annual Stockholders Meeting The annual meeting of stockholders will be held on April 26, 2002, at 10:00 a.m., at the Santa Clara Strategic design communications: Turner & Associates...

  • Page 39
    Yahoo! Inc. 701 First Avenue Sunnyvale, CA 94089 w w w.yahoo.com