Yahoo's negative financial evolution stopped by "world's biggest retailer"?

Yahoo's negative financial evolution stopped by "world's biggest retailer"?

Search engine Yahoo has seen its turnover decrease again in the third quarter, with not many signs of improvement on the horizon.  There is just one: Chinese Alibaba’s approaching IPO might be the silver lining Yahoo has been waiting for.

Declining search engine market share

In its most recent quarter, Yahoo had to settle for a turnover of a mere 1.08 billion dollars (840 million euro): even lower than the same quarter last year, which resulted in 1.09 billion dollars (890 million euro). Google’s overpowering position is killing off Yahoo, as its market share in search results is dwindling, taking its advertising revenue with it.

 

Not only Google is stealing market share, Microsoft’s Bing is also taking away market share: Yahoo had a July market share of only 11.3 % in the United States. It is hoping to heighten that number by adding a few new features, but their success is far from certain.

 

Saved by the “world’s largest retailer”?

Soon however, Yahoo may be getting its share of good news, as it owns quite a few shares of Chinese e-commerce giant Alibaba. That company is currently negotiating with several stock markets; an IPO would probably result in a quite large financial surge for Yahoo.

 

Alibaba aims to become the world’s largest retailer company by 2016. Currently, it is the world's largest e-tailer and is larger than eBay and Amazon put together, but it wants to surpass the current offline leader, Walmart, within the next three years. Reuters was told by CEO Jonathan Lu that Alibaba’s number of transactions should triple by 2016, pushing its turnover to some 3 trillion yuan (360 billion euro). 

 

Alibaba has recently invested hugely in ShopRunner, hoping to expand into the United States as part of its strategy. It still plans to invest more in China, with 12 billion euro spent in logistics and assistance of Chinese retailing by 2020.

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