) recently announced its acquisition of Summly, a news app for
which Yahoo paid $30 million according to AllThingsD.
Summly was created by 17-year-old Nick D'Aloisio and launched
) iPhone. The app works as a news condenser i.e. it narrows down
a full-length article or news to 350-400 words thus making it
easier for readers to grasp the gist of the news.
Following the acquisition, Nick D'Aloisio is set to join Yahoo
as its youngest employee. The Summly app will close down and the
technology will be integrated into Yahoo's mobile platform.
Yahoo is marching ahead with its plan to acquire struggling
start-up companies. Its recent purchases include Stamped, a
mobile review app maker; OnTheAir, which specializes in
broadcasting video chats or interviews to online audiences;
Snip.it, which is a kind of clipping service for the web;
Propeld, a location-based apps maker and Jybe, a social
The acquisitions are a part of a strategy to broaden and
strengthen Yahoo's expertise in the mobile segment as adoption of
mobile devices such as smartphones and tablets continue to
With these acquisitions, Yahoo is picking up a whole lot of
engineering talent as well as key technologies and products at a
cheaper rate. These acquisitions can help Yahoo enter the
emerging social marketing segment, where its rivals have already
The acquisition of these small start-up companies is a part of
Yahoo's strategy to strengthen its mobile offerings as it has
lost its leadership position in display advertising to
). With search advertising revenues on a decline not only because
of Google but also Microsoft, Yahoo needs to focus on other major
growth markets and emerging geographies.
In the third quarter of fiscal 2012, Yahoo generated revenues
of $1.20 billion, which were 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 #3 (Hold).
APPLE INC (AAPL): Free Stock Analysis Report
FACEBOOK INC-A (FB): Free Stock Analysis
GOOGLE INC-CL A (GOOG): Free Stock Analysis
YAHOO! INC (YHOO): Free Stock Analysis Report
To read this article on Zacks.com click here.