Tag Archives: yhoo

Facebook, Alphabet To Benefit As Digital Ads Overtake TV In 2017

EMarketer expects 2017 to be a watershed year for U.S. digital ad spending. The research firm says that in that year, digital will overtake spending on TV ads for the first time. Digital ad leaders Facebook ( FB ), Alphabet ( GOOGL ) subsidiary Google and Yahoo ( YHOO ) are poised to benefit. In 2016, total digital ad spending is expected to reach 35.8% of all U.S. ad spending, trailing TV ad spending’s 36.8% share, eMarketer said. But next year, digital ad spending will rise to 38.4% of total U.S. ad spending, some $77.37 billion, while TV ad spending will comprise 35.8% of total media ad spending, or $72.01 billion, says eMarketer. “We still expect positive growth for TV ad spend, driven by political advertising and the summer Olympics,” said eMarketer senior forecasting analyst Martin Utreras. “However, we see more ad dollars flowing to digital as a way of optimizing spending in what may be a challenging economic year.” Mobile is continuing to drive growth within overall digital ad spending. Mobile ad spending in the U.S. will rise 38% this year to $43.6 billion, according to the eMarketer report. Mobile will represent 63.4% of total digital ad spending in the U.S. this year, it says. “As consumers continue to increase engagement with mobile devices for daily activities and content consumption, marketers will further integrate all marketing activities — including advertising — to the mobile category,” said Utreras. Video will also gain, with spending on digital video advertising expected to rise 19% to $11.72 billion in 2017 and another 14%, to $13.39 billion, in 2018, eMarketer said. This year, market leader Google is expected to win 38.7% of all digital ad spending in the U.S., eMarketer said. Facebook will come in at No. 2 with a 15% share, while Microsoft ( MSFT ) will control 3.8% of the market. Yahoo will have 3.4% of digital ad spending this year, while Twitter ( TWTR ) will hold 2.4%, according to eMarketer. Among ad buyers committed to start buying advertising on social media sites, eMarketer said that 22% will begin advertising on Snapchat for the first time this year. eMarketer added that 12% planned to start advertising on Pinterest or Facebook’s Instagram, while 10% of respondents planned to begin advertising on Yahoo-owned Tumblr. In January, investment bank Cowen & Co. said that it expects U.S. digital advertising to overtake spending on TV advertising in 2016, a full year ahead of its prior forecast. It based its forecast on its survey of 50 senior U.S. ad buyers. Image provided by Shutterstock .

Verizon Most Likely Yahoo ‘Savior’ But Many Interested?

Expressions of interest are pouring in from dozens of groups that are eyeing buying struggling Web portal Yahoo ( YHOO ), with Verizon ( VZ ) rumored to be the most likely acquirer, said Monness Crespi Hardt analyst James Cakmak in an industry research report on Monday. “Verizon is still the most likely savior despite potential risks, in our opinion,” wrote Cakmak, who added that more than 40 expressions of interest have been made for Yahoo and that technology-focused investment banker Frank Quattrone may be positioning embattled Yahoo CEO Marissa Mayer along with the company’s core business as a package deal. But the prospects for a private industry pair-up are low, according to Cakmak. “While we have entertained the idea of private equity previously, we no longer think it’s a realistic option given Ms. Mayer’s desire to maintain a central role,” wrote Cakmak. Monness Crespi estimates the value of Yahoo’s core assets at $3 billion to $4 billion. Yahoo has received nearly 40 expressions of interest from prospective bidders including Verizon, AT&T and Time, said a report last week in the NY Post . Mayer is under intensified pressure from major investor Starboard Value, which has urged the exit of Mayer and some directors, as well as the spinoff of Yahoo’s core search business. Yahoo directors are close to offering at least two board seats to the activist hedge fund in order to avert a proxy fight, according to the New York Post’s report. Aside from forming a committee of independent directors to explore possible transactions, Yahoo announced last week that it will bring in Goldman Sachs, JPMorgan and PJT Partners as financial advisors, along with law firm Cravath, Swaine & Moore. Another company rumored to be interested in Yahoo is  Comcast ( CMCSA ). Verizon has talked up its interest in buying some Yahoo assets “at the right price,” but also said it does not want to “catch a falling knife,” referring to the state of Yahoo’s business. Rumors re-emerged last week that e-commerce giant Alibaba Group ( BABA ) might buy back a valuable stake that Yahoo now holds in the Chinese company. Yahoo’s Asian assets — comprised of its Alibaba holdings and a 35.5% stake in Yahoo Japan — represent the vast majority of Yahoo’s $32.2 billion market value. Yahoo owns a 15% stake in Alibaba, or about 384 million shares. But some observers say such a transaction is unlikely because of high tax implications for Alibaba. Analysts say Yahoo is poised to lose more ad dollars to Facebook ( FB ), Alphabet ( GOOGL )-owned Google and high-profile startups such as Snapchat and Pinterest. Yahoo stock was up 1% in midday trading in the stock market today , near 34, its highest point since late December. But concerns on the health of its core business has driven down Yahoo stock 22% since this time last year. Alibaba stock was up 2%, near 74. A Wall Street Journal report noted that the China e-commerce king’s Ant Financial Services is looking to raise up to $3 billion, pricing the subsidiary’s valuation at over $50 billion and potentially vaulting it into the Top 10 of China’s largest financial companies.  

SoftBank Divides, Lumps Sprint, Alibaba Stake Amid Debt Crunch

SoftBank Group said it will split into two companies, putting U.S.-based Sprint ( S ), its stake in China’s Alibaba ( BABA ) and other overseas operations into one entity. In its statement, SoftBank,, which is Sprint’s majority owner, did not say how the restructuring  would affect its sizable debt. Credit rating agencies have not yet commented on the move. Nikesh Arora, SoftBank Group president, will head up operations abroad, the company said. The other entity will include SoftBank’s mobile operations in Japan, including its investment in Yahoo Japan ( YHOO ). SoftBank founder Masayoshi Son will control both companies. SoftBank shares closed 1.8% lower Monday on the Tokyo stock exchange before the announcement. Sprint stock was up 1.5% in early trading in the stock market today , near 4. Sprint has struggled vs. Verizon Communications ( VZ ), AT&T ( T ) and T-Mobile US ( TMUS ). According to a Bloomberg report last week, SoftBank is set to establish a subsidiary that will inject capital into Sprint. The subsidiary will accept Sprint’s wireless equipment and part of its wireless spectrum as collateral for $3 billion to $5 billion in loans. Sprint has about $33 billion in debt. Sprint exited Q4 with about $6 billion in liquidity, but continues to burn cash. “With $2.3 billion in debt coming due in 2016 ($10 billion by 2020) and given the widening spreads in the high-yield markets, Sprint has limited options to favorably access capital markets,” said Oppenheimer in a research report. Some analysts have speculated that SoftBank will take a write-down related to the Sprint acquisition. SoftBank paid $21.6 billion for 78% of Sprint, in a deal that closed in 2013. “Sprint’s share price had risen to $4 as of March 3, and we expect SoftBank to avoid asset impairment losses on its stake in Sprint at the parent level if the share price is above the end-September 2015 level of $3.84 at end-March 2016,” said Nomura Securities in a report.