Yahoo! earnings off, CEO search on

(Telephony) Apparently not enough people Yahoo!

The Internet company yesterday reduced first quarter sales and profits projections and said it was on the lookout for a new CEO to supplant Tim Koogle, who will assume a role as “active and dedicated chairman.” The search will be conducted outside the company, so COO Jeff Mallett is not a candidate.

“This position is the result of a drive we have had under way to add great senior level talent, to increase our bench strength and to position us for the new phase of growth for our company,” Koogle said.

When that phase will begin is uncertain.

“Visibility is really poor on the back end of the year,” Koogle said. “The economy continues to soften at a fairly rapid rate, and, if we see that going up, our confidence level could go back up.”

That confidence level has been shaken by a soft economy, an unsure advertising industry and the apparently terminal illness creeping through the dotcom space. Yahoo!, which claims 185 million consumers worldwide, projects revenues in the $170 million to $180 million range for the quarter--below previous levels of over $200 million--but will break even on a pro forma, EBITDA and earnings-per-share basis.

The fallback stems more from lost or missing advertising revenues than from the business and enterprise services business, which “continues to experience good growth,” said Koogle. As a result, the company is hopeful the problems are short-term.

“We don’t hear any words from markets or agencies that would indicate they don’t feel this medium is very attractive,” Koogle said. “The thing that really needs to be built is what we’re building, our set of integrated solutions that deliver that value to them.”

CFO Susan Decker tried to offer a ray of hope as the company’s stock continued to spiral from 200-plus into the low double-digits range.

“In economic and capital market times like this, only the industry leaders can find silver linings,” said Decker. “For Yahoo!, the silver lining has been our superior relative financial position with providing the freedom to proactively take the operational and competitive steps necessary to drive growth in 2002 and beyond.” said Decker, who called 2001 “a transitional year for Yahoo!.”

Decker called 2001 “a transitional year for Yahoo!,” and Koogle said the new CEO will drive that transition.

“I think it’s a great time to be proactive about that and go out and extend our team and bring in another team member to join us,” Koogle said.