Yahoo 2008 Annual Report Download - page 69

Download and view the complete annual report

Please find page 69 of the 2008 Yahoo annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 132

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132

Yahoo! Inc.
Notes to Consolidated Financial Statements—(Continued)
Company reports revenue, for which it is the primary obligor in the arrangement and for which it provided a
product or service, at the gross amount.
Marketing services revenues are generated from several offerings including the display of graphical
advertisements (“display advertising”), the display of text based links to an advertiser’s Website (“search
advertising”), listing based services, and commerce based transactions.
The Company recognizes revenues from display advertising on Yahoo! Properties as “impressions” are
delivered. An “impression” is delivered when an advertisement appears in pages viewed by users. Arrangements
for these services generally have terms of up to three years and in the majority of cases, the terms are less than
one year or may be terminated at any time by the advertiser. Certain advertising agreements often involve
multiple elements (arrangements with more than one deliverable).
The Company also recognizes revenues from search advertising, which are placed on Yahoo! Properties. Search
advertising revenue is recognized as “click-throughs” occur. A “click-through” occurs when a user clicks on an
advertiser’s listing.
Marketing services revenues also includes listings and transaction revenues. Listings revenues are generated from
a variety of consumer and business listings-based services, including access to the Yahoo! HotJobs database and
classified advertising such as Yahoo! Autos, Yahoo! Real Estate, and other services. The Company recognizes
listings revenues when the services are performed. Transaction revenues are generated from facilitating
commercial transactions through Yahoo! Properties, principally from Yahoo! Travel and Yahoo! Shopping. The
Company recognizes transaction revenues when there is evidence that qualifying transactions have occurred, for
example, when travel arrangements are booked through Yahoo! Travel.
In addition to delivering search and display advertising on Yahoo! Properties, the Company also generates
revenues from search and/or display advertising offerings on Affiliate sites. The Company pays Affiliates for the
revenues generated from the display of these advertisements on the Affiliates’ Websites. These payments are
called traffic acquisition costs (“TAC”). The revenues derived from these arrangements that involve traffic
supplied by Affiliates are reported gross of the payment to Affiliates. These revenues are reported gross due to
the fact that the Company is the primary obligor to the advertisers who are the customers of the advertising
service.
Fees revenues consist of revenues generated from a variety of consumer and business fee-based services,
including Internet broadband services, royalties received from joint venture partners, premium mail, music and
personals offerings as well as services for small businesses. The Company recognizes fees revenues when the
services are performed.
Current deferred revenue primarily comprises contractual billings in excess of recognized revenues and payments
received in advance of revenue recognition. Long-term deferred revenue includes amounts received from
customers for which services will not be delivered within the next 12 months.
Restructuring Charges. The Company has developed and implemented restructuring initiatives to improve
efficiencies across the organization, reduce operating expenses, and better align its resources to market
conditions. As a result of these plans, the Company has recorded restructuring charges comprised principally of
employee severance and associated termination costs related to the reduction of its workforce, office closures,
losses on subleases and contract termination costs. These activities have been accounted for primarily in
accordance with Statement of Financial Accounting Standards (“SFAS”) No. 146, “Accounting for Costs
Associated with Exit or Disposal Activities” (“SFAS 146”). SFAS 146 requires that a liability for costs
63