) recently announced the acquisition of social news start-up
Snip.it. First reported by AllThingsD, the news was later
confirmed in a Snip.it blog post. The terms of the acquisition
have not been disclosed, but media reports suggest that it will
cost Yahoo more than $10 million.
Founder Ramy Adeeb started the company in 2011 with funds from
True and Khosla Ventures as well as other investors. Snip.it is a
social platform that allows users to collect, organize and share
articles. Users can check other collections, add another
collection into their own and share their collection on other
social media platforms like Twitter,
) Google+ and others.
Following the acquisition, Snip.it's 10-member team will be
working with Yahoo. The service from Snip.it will be shut down
but users have the option of downloading their data up to Feb 21,
Yahoo is marching ahead with its plan to acquire struggling
start-up companies. Before Snip.it, it acquired another small
startup, OnTheAir specializing in broadcasting video chats or
interviews to online audiences.
The idea behind acquiring these start-ups is to pick up
engineering talent, key technologies and products offered by
them. These acquisitions could help Yahoo get into the emerging
social marketing segment, where its rivals have already made a
In fact, Yahoo's leadership position in display advertising
has been lost to Facebook and Google. With search advertising
revenues on a secular decline - not only because of Google but
), Yahoo needs to focus on the other major growth area. As per an
Internet survey, it was found that 65.0% of Internet users in the
U.S. used social networking sites, an indication of the growing
popularity of the platform.
In the third quarter of fiscal 2012, Yahoo generated revenue
of $1.20 billion, which was down 1.3% sequentially and 1.2% year
over year. Traffic acquisition cost (TAC) was down 17.7%
sequentially and 22.2% from last year. Excluding these costs in
all periods, net revenue was essentially flat on a sequential
basis and up 1.6% from last year, in line with the consensus
Yahoo has a Zacks Rank #1 (Strong Buy).
FACEBOOK INC-A (FB): Free Stock Analysis
GOOGLE INC-CL A (GOOG): Free Stock Analysis
MICROSOFT CORP (MSFT): Free Stock Analysis
YAHOO! INC (YHOO): Free Stock Analysis Report
To read this article on Zacks.com click here.