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Yahoo earnings confirm Google taking substantial market share

Yahoo's announced earnings confirm that Google continues to take substantial search advertising revenue and profit share in the first full quarter of financial results since the DOJ blocked the Google-Yahoo Ad Partnership as anti-competitive.

  • Yahoo's owned and operated search advertising revenues fell 3% compared to Google-site search advertising revenues which grew 9% -- a 12% differential -- signalling significant market share gain by Google at Yahoo's expense.
  • Yahoo's affilitate (syndicated) advertising search revenues fell 16% compared to Google-site syndicated advertising search revenues which fell 3% -- a 13% differential -- again signalling significant and comparable market share gain by Google at Yahoo's expense.

Google's dominance of search advertising profit share is even greater than that of revenues because historically the only other publicly-traded search advertising players with significant search advertising revenues: Microsoft, AOL, and IAC/ all consistently lose money in this search advertising segment.

  • Since the only two profitable search advertising franchises of any significance have now reported, Google with GAAP net income of $1.42b and Yahoo with GAAP net income of $118m, we now can calculate that Google commanded ~92% share of search advertising profits. Yes ~92%.

Most all the evidence coming in from reported earnings, ComScore and Hitwise, indicate Google is steadily increasing its dominance of the search advertising marketplace.