Revenue for the period totalled $1.7bn, an 8% improvement on last year. However, Yahoo!'s growth is lower than the advertising industry average for the same period, which has been in double-digits.
Jerry Yang, co-founder and recently named chief executive officer of Yahoo!, said: "I am focused on doing everything we need to do to strengthen our business, capture long-term growth opportunities and create increased value for our shareholders.
"By sharpening our focus, speeding execution, building our technology and talent, and investing in key growth areas, we can put Yahoo! on a clear path to fulfill its potential as an internet leader."
After subtracting commissions paid to its online advertising partners, Yahoo! said its revenue stood at $1.24bn.
As well as suffering from poor demand for its display ads, the internet company has seen upheaval in top management.
Last month, Yahoo! CEO Terry Semel was replaced by company co-founder Yang, while former chief financial officer Susan Decker was promoted to company president
At the time, Semel said: "This is the right thing to do for Yahoo and the right time to do it," while calling Yang and Decker "the perfect combination to carry us forward."
However, some critics have expressed doubts about Yang's ability to lead the company due to his lack of experience as a top executive, leading to theories his tenure may only be temporary.