SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 DATE OF REPORT: July 9, 1998 --------------------------- YAHOO! INC. (Exact name of registrant as specified in its charter) 0-26822 (Commission File Number) CALIFORNIA 77-0398689 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 3420 CENTRAL EXPRESSWAY SANTA CLARA, CALIFORNIA 95051 (Address of principal executive offices, with zip code) (408) 731-3300 (Registrant's telephone number, including area code) ITEM 5. OTHER EVENTS On July 9, 1998, Yahoo! Inc., a California corporation ("Yahoo!") announced (i) Yahoo!'s financial results for the quarter ended June 30, 1998, (ii) a 2-for-1 stock split, and (iii) a $250 million private placement of Common Stock to SOFTBANK Holdings, Inc. A copy of Yahoo!'s press releases announcing these matters are attached as Exhibits 99.1, 99.2, and 99.3 hereto and incorporated by reference herein. The press releases filed as exhibits to this report include "safe harbor" language, pursuant to the Private Securities Litigation Reform Act of 1995, indicating that certain statements about the Company's business contained in the press release are "forward-looking" rather than "historic." The press release also states that a more thorough discussion of factors affecting the Company's operating results is included in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1997, and the Company's Current Report on Form 8-K dated June 18, 1998, filed with the Securities and Exchange Commission. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. (c) EXHIBITS. 99.1 Press Release dated July 8, 1998. 99.2 Press Release dated July 8, 1998. 99.3 Press Release dated July 8, 1998. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. YAHOO! INC. Date: July 9, 1998 By: /s/ Gary Valenzuela ----------------------------------- Gary Valenzuela Senior Vice President, Finance and Administration, and Chief Financial Officer YAHOO! INC. INDEX TO EXHIBITS Exhibit Number Description - -------------- ----------- 99.1 Press Release dated July 8, 1998. 99.2 Press Release dated July 8, 1998. 99.3 Press Release dated July 8, 1998.
FOR IMMEDIATE RELEASE YAHOO! REPORTS SECOND QUARTER FINANCIAL RESULTS SECOND QUARTER PRO FORMA NET INCOME OF $0.15 PER SHARE SANTA CLARA, CALIF. - JULY 8, 1998 - Yahoo! Inc. (NASDAQ: YHOO) today reported revenues totaling $41.2 million for the second quarter ended June 30, 1998, a 192 percent increase over the same period in 1997. Pro forma net income for the second quarter of 1998 was $8.1 million, or $0.15 per share diluted, before the effect of a $44.1 million non-recurring charge for in-process R&D purchased in the acquisition of Viaweb Inc. The pro forma net income for the current quarter compares with a pro forma net loss of $0.3 million or $0.01 per share diluted, excluding the effect of a $21.2 million non-recurring, non-cash charge incurred during the second quarter of 1997. In separate announcements today, Yahoo!-Registered Trademark- said its Board of Directors has approved a 2-for-1 common stock split and that it has entered into an agreement for a $250 million private placement of common stock to SOFTBANK Holdings, Inc. Yahoo! today also announced that its traffic grew to an average of 115 million page views per day during the month of June 1998, compared to the 95 million page views per day average during March 1998. Yahoo! Japan, which is included in the above page view totals, increased to an average of approximately 8 million page views per day during the month of June 1998 from an average of approximately 6 million per day in March 1998. A page view is defined as one electronic page of information displayed in response to a user request. Yahoo! also announced that its registered user base grew to more than 18 million members, compared to more than 12 million as of March 1998, reflecting the number of people who have submitted personal data for Yahoo!'s universal registration process. In addition, Yahoo! was recently ranked No. 1 in reach among all Web sites with 54.1 percent of work users accessing Yahoo!. The company's reach among home users has grown to 44.4 percent, and is second only to AOL's reach by 1 percent (Media Metrix, May 1998). "While we maintained our leadership position in audience reach among work users and continued to experience popularity among home users, we had significant growth in the number of registered Yahoo! members during the quarter," said Tim Koogle, president and CEO, Yahoo!. "We continued to build on the strong distribution platform we deliver to advertisers, merchants, and content providers. As a result, we were able to sign several key agreements during the quarter and experienced strong revenue growth. As always, we are continuing to focus on building our strong brand, delivering quality content and services, and aggressively growing our global audience as well as our advertising and commerce revenue." MERCHANT AND SHOPPING SERVICES During the second quarter, Yahoo! expanded its online merchant services. The company acquired Viaweb Inc. and launched Yahoo! Store to provide small and medium-sized online merchants with a complete, easy-to-use service to create, design, host, manage and promote online stores. In addition, Yahoo! launched Impulse Deals, a new merchandising platform where merchants can offer targeted shopping bargains on the Web. Also during the quarter, AutoConnect joined Yahoo! - MORE - YAHOO! REPORTS SECOND QUARTER FINANCIAL RESULTS/PAGE 2 Autos' (autos.yahoo.com) featured merchant button program, providing users with easy access to shop for and purchase cars. AT&T and JFAX joined Yahoo!'s premier merchant program to provide traditional communication services and unified messaging services, respectively. The Fragrance Counter is now enabling Yahoo! users to purchase designer fragrances and cosmetics in relevant areas throughout the Yahoo! network of properties. PROGRAMMING Yahoo! further expanded its programming during the quarter. The company announced that Inktomi will become Yahoo!'s integrated default search results provider beginning in the third quarter. Yahoo! introduced Yahoo! Computers (computers.yahoo.com), offering users news, product reviews, shareware downloads, shopping services and chats. The company launched Yahoo! Movies (movies.yahoo.com) providing a directory of movie and entertainment information, showtimes, new releases, news and reviews and more. Yahoo! also launched Yahoo! Real Estate (realestate.yahoo.com), a comprehensive, free resource for listings, tools and information on buying, selling and renting property. In addition, Yahoo! Sports (sports.yahoo.com) is providing full coverage of the World Cup '98 in 11 different languages for users around the world. COMMUNICATION SERVICES During the quarter, Yahoo! enhanced the communications services it offers users. Yahoo! users now have convenient access to order and be billed for AT&T's traditional communication services online. In addition, JFAX enables users to turn their Yahoo! Mail (mail.yahoo.com) account into a universal in-box for incoming and outgoing electronic, fax or voice messages. Yahoo! Chat (chat.yahoo.com), the leading Web-based chat service, partnered with PRIMEDIA during the quarter, and now features more than 100 celebrity and expert chats each month. EXPANDING AUDIENCE Yahoo! extended its distribution during the quarter through an agreement with Compaq. My Yahoo! is now the default Internet start page on Compaq's new Internet PC product family, enabling customers to fully personalize their Web experience. INTERNATIONAL GROWTH As in the U.S., the company's World Yahoo!s are very popular among Web users, with several of its international sites being ranked No. 1 in various categories. Yahoo! significantly expanded its network of international properties during the quarter. In addition to Yahoo! Italy (yahoo.it), a geographically-based Web guide, Yahoo! launched two language-based Web guides for the significant number of Chinese (chinese.yahoo.com and gbchinese.yahoo.com) and Spanish (espanol.yahoo.com) speaking Web users around the world. The comprehensive, global, branded network of Yahoo! properties has grown to now include 14 World Yahoo!s featuring content and services for geographic areas and language-based global communities. ABOUT YAHOO! Yahoo! Inc. is a global Internet media company that offers a network of branded Web programming serving millions of users daily. As the first navigational guide to the Web, www.yahoo.com is the single largest guide in terms of traffic, advertising, household and business user reach, and is one of the most recognized brands associated with the Internet. Yahoo! provides targeted Internet resources and communications services for a broad range of audiences, based on demographic, key-subject and geographic interests. Yahoo! is headquartered in Santa Clara, Calif. - MORE - YAHOO! REPORTS SECOND QUARTER FINANCIAL RESULTS/PAGE 3 This announcement contains forward looking statements that involve risks and uncertainties, including those relating to the company's ability to grow its user and advertiser base, and advertising and commerce revenues. Actual results may differ materially from the results predicted and reported results should not be considered an indication of future performance. The potential risks and uncertainties include, among others, the company's limited operating history, the increasingly competitive environment for Web services and advertising sales, the early stage of the Web as an advertising medium, the company's dependence on advertising revenues and third parties for technology, content and distribution. More information about potential factors which could affect the company's business and financial results is included in the company's annual report on Form 10-K for the year ended Dec. 31, 1997, including (without limitation) under the captions, "Management's Discussion and Analysis of Financial Condition and Results of Operations," "Risk Factors," "Competition," and "Proprietary Rights," the company's quarterly report on Form 10-Q for the period ended March 31, 1998, and the company's current report filed on Form 8-K dated June 18, 1998, which are on file with the Securities and Exchange Commission (www.sec.gov). The accompanying condensed consolidated statements of operations and balance sheets are an integral part of this announcement. # # # Yahoo! and the Yahoo! logo are trademarks and/or registered trademarks of Yahoo! Inc. All other names are trademarks and/or registered trademarks of their respective owners. CONTACTS: Gary Valenzuela Diane Hunt Senior Vice President and Director, Corporate Communications Chief Financial Officer Yahoo! Inc. Yahoo! Inc. (408) 731-3441 (408) 731-3350 diane@yahoo-inc.com investor_relations@yahoo-inc.com YAHOO! INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) (1) PRO FORMA NET INCOME (LOSS) PER SHARE DILUTED EXCLUDES THE EFFECT OF IN-PROCESS PURCHASED TECHNOLOGY OF $44,100,000 INCURRED IN CONNECTION WITH THE ACQUISITION OF VIAWEB INC. DURING THE QUARTER ENDED JUNE 30, 1998 AND EXCLUDES THE EFFECT OF A ONE-TIME NON-CASH CHARGE OF $21,245,000 RELATED TO THE VISA MARKETPLACE RESTRUCTURING INCURRED DURING THE QUARTER ENDED JUNE 30, 1997. NOTE: THE ABOVE SHARE AND PER SHARE CALCULATIONS DO NOT REFLECT THE EFFECT OF THE JULY 1998 2-FOR-1 STOCK SPLIT.
THREE MONTHS ENDED SIX MONTHS ENDED JUNE 30, JUNE 30, ---------------------------- ----------------------------- 1998 1997 1998 1997 ---------- ---------- ---------- ---------- NET REVENUES $ 41,210 $ 14,107 $ 71,416 $ 24,172 COST OF REVENUES 4,720 2,318 8,637 3,755 -------- -------- -------- -------- GROSS PROFIT 36,490 11,789 62,779 20,417 -------- -------- -------- -------- OPERATING EXPENSES: SALES AND MARKETING 20,044 9,448 36,140 16,863 PRODUCT DEVELOPMENT 5,010 2,444 9,544 4,693 GENERAL AND ADMINISTRATIVE 2,227 1,613 4,219 2,910 OTHER - NON-RECURRING COSTS 44,100 21,245 44,100 21,245 -------- -------- -------- -------- TOTAL OPERATING EXPENSES 71,381 34,750 94,003 45,711 -------- -------- -------- -------- LOSS FROM OPERATIONS (34,891) (22,961) (31,224) (25,294) INVESTMENT INCOME, NET 1,848 1,227 3,294 2,618 MINORITY INTERESTS IN OPERATIONS OF CONSOLIDATED SUBSIDIARIES 112 182 355 384 -------- -------- -------- -------- LOSS BEFORE INCOME TAXES (32,931) (21,552) (27,575) (22,292) PROVISION FOR INCOME TAXES 3,060 - 4,131 - -------- -------- -------- -------- NET LOSS $(35,991) $(21,552) $(31,706) $(22,292) -------- -------- -------- -------- -------- -------- -------- -------- NET LOSS PER SHARE - DILUTED $ (0.81) $ (0.50) $ (0.72) $ (0.52) -------- -------- -------- -------- -------- -------- -------- -------- WEIGHTED AVERAGE COMMON SHARES AND EQUIVALENTS USED IN PER SHARE CALCULATION - DILUTED 44,504 43,146 43,778 42,689 -------- -------- -------- -------- -------- -------- -------- -------- PRO FORMA NET INCOME (LOSS) PER SHARE - DILUTED (1) $ 0.15 $ (0.01) $ 0.23 $ (0.02) -------- -------- -------- -------- -------- -------- -------- -------- WEIGHTED AVERAGE COMMON SHARES AND EQUIVALENTS USED IN PRO FORMA NET INCOME (LOSS) PER SHARE CALCULATION - DILUTED 54,597 43,146 53,986 42,689 -------- -------- -------- -------- -------- -------- -------- -------- YAHOO! INC. CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS)
JUNE 30, DECEMBER 31, 1998 1997 ----------- ------------ (UNAUDITED) (AUDITED) ASSETS CASH, CASH EQUIVALENTS, AND INVESTMENTS IN MARKETABLE SECURITIES $ 147,236 $ 107,012 ACCOUNTS RECEIVABLE, NET 16,795 10,986 PREPAID EXPENSES 4,211 5,893 PROPERTY AND EQUIPMENT, NET 8,987 7,035 OTHER ASSETS 14,389 10,958 --------- --------- TOTAL ASSETS $ 191,618 $ 141,884 --------- --------- --------- --------- LIABILITIES AND SHAREHOLDERS' EQUITY LIABILITIES: ACCOUNTS PAYABLE $ 5,633 $ 5,477 ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES 19,857 13,127 DEFERRED REVENUE 18,533 4,852 --------- --------- TOTAL LIABILITIES 44,023 23,456 MINORITY INTERESTS IN CONSOLIDATED SUBSIDIARIES 961 716 SHAREHOLDERS' EQUITY: COMMON STOCK 206,657 146,126 ACCUMULATED DEFICIT (59,677) (27,971) CUMULATIVE TRANSLATION ADJUSTMENT (346) (443) --------- --------- TOTAL SHAREHOLDERS' EQUITY 146,634 117,712 --------- --------- $ 191,618 $ 141,884 --------- --------- --------- ---------
FOR IMMEDIATE RELEASE YAHOO! ANNOUNCES 2-FOR-1 STOCK SPLIT SANTA CLARA, CALIF. - JULY 8, 1998 - Yahoo! Inc. (NASDAQ: YHOO) today announced that its Board of Directors has approved a 2-for-1 common stock split. Shareholders on the record date of July 17, 1998 will be entitled to one additional share for every share they own on that date. New shares will be issued by the company's transfer agent, Boston Equiserve, on July 31, 1998. The date on which the split shares will be reflected on NASDAQ trading prices is August 3, 1998. More information about Yahoo!'s common stock split can be found at http://www.yahoo.com/info/investor/split_faq.html. ABOUT YAHOO! Yahoo! Inc. is a global Internet media company that offers a network of branded Web programming serving millions of users daily. As the first navigational guide to the Web, www.yahoo.com is the single largest guide in terms of traffic, advertising, household and business user reach, and is one of the most recognized brands associated with the Internet. Yahoo! provides targeted Internet resources and communications services for a broad range of audiences, based on demographic, key-subject and geographic interests. Yahoo! is headquartered in Santa Clara, Calif. # # # Yahoo! and the Yahoo! logo are trademarks and/or registered trademarks of Yahoo! Inc. All other names are trademarks and/or registered trademarks of their respective owners. CONTACTS: Gary Valenzuela Senior Vice President and Chief Financial Officer Yahoo! Inc. (408) 731-3350 investor_relations@yahoo-inc.com Diane Hunt Director, Corporate Communications Yahoo! Inc. (408) 731-3441 diane@yahoo-inc.com
FOR IMMEDIATE RELEASE YAHOO! ANNOUNCES $250 MILLION PRIVATE PLACEMENT OF COMMON STOCK SANTA CLARA, CALIF. - JULY 8, 1998 - Yahoo! Inc. (NASDAQ: YHOO) today announced that it has entered into an agreement for a private placement of common stock to SOFTBANK Holdings, Inc., one of the company's principal shareholders, which will result in proceeds to Yahoo!-Registered Trademark- of $250 million. SOFTBANK will purchase 1,363,440 newly issued shares in the transaction, bringing SOFTBANK'S total ownership to approximately 31 percent of Yahoo!'s issued and outstanding common stock. In connection with the transaction, which is expected to close next week, Yahoo! also agreed to provide registration rights comparable to the registration rights provided on the shares acquired by SOFTBANK prior to Yahoo!'s April 11, 1996 initial public offering. ABOUT YAHOO! Yahoo! Inc. is a global Internet media company that offers a network of branded Web programming serving millions of users daily. As the first navigational guide to the Web, www.yahoo.com is the single largest guide in terms of traffic, advertising, household and business user reach, and is one of the most recognized brands associated with the Internet. Yahoo! provides targeted Internet resources and communications services for a broad range of audiences, based on demographic, key-subject and geographic interests. Yahoo! is headquartered in Santa Clara, Calif. # # # Yahoo! and the Yahoo! logo are trademarks and/or registered trademarks of Yahoo! Inc. All other names are trademarks and/or registered trademarks of their respective owners. CONTACTS: Gary Valenzuela Senior Vice President and Chief Financial Officer Yahoo! Inc. (408) 731-3350 investor_relations@yahoo-inc.com Diane Hunt Director, Corporate Communications Yahoo! Inc. (408) 731-3441 diane@yahoo-inc.com