Yahoo! sees 42% revenue increase as ad sales rise

NEW YORK - Yahoo! has said that revenues for the second quarter of the year are up by 42% to $321.4m, bolstered by a growth in advertising spend on the website.

Yahoo! sees 42% revenue increase as ad sales rise

Listings revenues rose by 29% to $32.3m (£19.9m), while fees revenues from premium services and Yahoo! Personals were up by 49% for the quarter to $69.9m. Sponsored searches were another major area of growth, contributing to a 44% increase in marketing services revenues at the company.

has been moving away from an advertising-based revenue model and introduced a number of paid-for services over the past 12 months, including a video service to watch clips of sports and television events; astrology; and a paid-for music site.

Terry Semel, chairman and CEO of Yahoo!, said: "Some of the key drivers of success this quarter include more balanced growth in marketing services from traditional advertising and sponsored search, as well as ongoing success converting consumer and small businesses to fee-based services. We are optimistic about the future and we remain steadfastly focused on execution against our priorities."

The company's biggest area of revenue, marketing services, saw income leap to $219.2m, up from $151.7m last time. Marketing services includes Yahoo!'s sponsored search business, a major area of growth.

Yahoo! said it currently has 3.5m paying subscribers to its various services, including its internet access deal with SBC Communications. Looking forward, Yahoo said it was raising its subscriber estimate for the year to a range of 4.2m to 4.5m, partly on the back of a deal similar to the SBC one that it has signed in the UK with BT.

Yahoo has also floated the idea of introducing what is being called a "bring-your-own-access plan", which would allow subscribers to access some of Yahoo's premium services regardless of their service provider.

However, Semel said the priority was upgrading its the SBC service and launching the BT service later this year.

"As soon as we've launched those two, we will then go with a package of Yahoo! broadband products available wherever you're getting your access from," he told Reuters.

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