Yahoo reports 2% dip in earnings

Yahoo's financial malaise dragged on during the second quarter as the Internet icon's profit slipped slightly and revenue growth lagged behind the pace of the online advertising market that it once led, an Associated Press report said.

The Associated Press report said Yahoo earned $160.6 million during the three months ending June 30. That represented a 2% decline from net income of $164.3 million at the same time last year.

It marked the sixth consecutive quarter in which Yahoo's profit has dropped from the previous year, the report said.

Revenue for the period totaled $1.7 billion, an 8% improvement from last year.

The Associated Press report said results and a dimmer outlook left little doubt why Yahoo decided to replace chairman Terry Semel as chief executive toward the end of the second quarter.

The report said Yahoo's new CEO, co-founder Jerry Yang, tried to assure analysts in a conference call that he realized the company needs to make dramatic changes.

He promised there would be 'no sacred cows' as he analyzes which parts of the business should be jettisoned so the company can focus its resources on developing technology that will revive earnings growth.

The overhaul isn't likely to include mass layoffs, according to Yang and other executives. The Associated Press report said management team emphasized the company's work force will likely expand from the 12,400 employees on the payroll at the end of June, with most of the hiring focused in its online search and advertising departments.