Yahoo 2005 Annual Report Download - page 3

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To Yahoo!’s shareholders, users,
partners, customers and employees:
As I look back on my fifth year as Chairman and
CEO of Yahoo!, I am immensely proud of all
we’ve accomplished as a company. When I
joined the company in 2001, I was convinced that
our tremendous global reach, strong brand, and
enormously talented people clearly positioned
Yahoo! to become a leading 21st century Internet
media company. I am very proud to report that
our hard work is paying off, reflected in broader
and deeper user engagement, expanded
relationships with advertisers, and our growing
global presence, all of which contributed to our
success in 2005.
Strong Financial Results
Our leadership and influence in the online world
contributed significantly to our strong financial
results in 2005. Full year 2005 revenue was $5.3
billion, an increase of 47% from the $3.6 billion of
revenue reported in 2004. We delivered record
revenues each quarter, reflecting robust growth in
both our advertising and premium services
offerings. Equally important, we converted our
growing revenue into improved profitability and
exceptional cash generation for our shareholders.
Yahoo!’s balance sheet became even stronger in
2005, with a year end balance of $4 billion in cash
and marketable debt securities, up from
$3.7 billion at 2004 year end, despite more
than $2 billion invested in acquisitions and share
repurchases. Our growing cash balance is a
testament to the high cash productivity of our
business model. We have been deliberate and
persistent in committing the appropriate resources
to both internal operations and acquisitions and
our healthy cash position provides us with
flexibility to pursue additional investments and
share repurchases, as appropriate.
Product Innovation
In 2005, we accelerated our pace of innovation
and intensified our focus on meeting the evolving
needs of our users and advertisers. No list of
our many accomplishments can do justice to all
the tremendous product development and
enhancement efforts of the nearly 10,000 Yahoo!
employees. I offer just a few highlights below.
Search Continuing to make search more useful,
engaging, and relevant for our users is Yahoo!’s top
priority. We have incorporated search into multiple
verticals including audio, video, image and local
search; enhanced Yahoo! HotJobs with an Internet
job search engine; and introduced Yahoo! Desktop
Search, enabling users to quickly locate files, emails,
archived instant messages, contacts and more.
Terry Semel