Yahoo! is certainly a big name on its own. When it has had it's success, now it's struggling just to get a glimpse of its former glory. CEO Marissa Mayer is unable to revive Yahoo!'s revenue on her own. And for that, she's looking for her former employer, Google, for a little help.
The company had a profit miss for 2015's Q3 with its revenue dropping 8 percent from the same time last year to $1 billion. The ongoing decline increases the worries that the internet company will be stuck in the hole it dug when spinning off China's Alibaba at 384 million shares worth about $28 billion.
Read: The Cursed Diamond Yahoo! Owns
Investors are unhappy for very good reasons, but Yahoo! has a solution: Mayer got the help she needs to give the company a new breath as Yahoo! reached a search agreement with Google. The three-years, non-exclusive agreement covers both Yahoo!'s mobile and desktop audience around the world.
"We're excited be announcing the partnership today," said Mayer during the Q&A of Yahoo!'s earnings call.
In October 2015, Google agreed to provide Yahoo! with the resources it needs: the flexibility of search results with ads. As Yahoo!'s "supplier", Google's offering is to complement the search services already provided by Microsoft, as well as to Yahoo!'s own search technologies and ad products.
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As a web portal with numerous services, Yahoo! has tried hard in developing its own search engine experience. But no matter what it did, including with its partnership with Microsoft, Google is still the undisputed champion in web searches. With Yahoo!'s partnership with Google, Yahoo! is trying to get all the help it needs to get its value back.
While Yahoo! is still performing well for desktop audiences, it's performing way behind in term of mobile audience acquisition. Despite Google performs a lot better on mobile, it's yet to perfect its mobile search. The company recently reported that its mobile users surpassed desktop for the first time.
Native ads have been the target in Mayer's regime in Yahoo!. Her move to partner with Google to provide Yahoo! a better value is seen similar with Tumblr's acquisition.
As a way to patch things up a bit further, Mayer is pledging to trim the company's expenses further. She already trimmed the company's payroll by laying off 10,700 workers in September 2015, down from 11,000 in June. Yahoo's workforce now has 1,800 fewer people than it did in 2014.
Mayer promises to concentrate the remaining company's workforce to work on fewer products with higher quality to achieve better growth and better results.
A Second Chance With Google
Yahoo!'s partnership with Google relating web searches is its second attempt to learn on Google's expertise in the search and advertising field. Back in 2008, Yahoo! tried to team up with Google as part of its defense against a takeover attempt by Microsoft.
Yahoo!'s attempt to get all the help it needs then continued when it tried negotiating a deal to rely on technologies provided by Microsoft's Bing search engine.
By having Google on its side once again, Yahoo! is now having two partners to provide web searches. Yahoo! still uses Bing, but also mixes the search results with Google.
Microsoft still remains committed to the Yahoo! syndication partnership. It will continue to serve the majority of Yahoo!'s traffic as outlined in their contract extension, said Microsoft's spokesperson.
$YHOO has signed a 3 year partnership with Google to bolster our search capabilities. This is in addition to our relationship with Microsoft
— Yahoo Inc. (@YahooInc) October 20, 2015
