) recently announced the acquisition of Jybe, a social
recommendation site for an undisclosed amount.
Founded in 2011 by ex-Yahoo! employees including Arnab
Bhattacharjee, former VP of Yahoo! Search Technology, Jybe has
developed an app for
) iPhone that recommends books, movies and restaurants based on
user preferences stated on social networking sites.
Following the acquisition, the Jybe team of 5 members will be
working with Yahoo. Jybe will shut down its existing app for the
iPhone and other web apps and the technology will be integrated
into Yahoo's other products.
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 and
Propeld, a location-based apps maker.
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 continues 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).
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