The company confirmed its intent to roll out new technology to improve the relevance of its paid search advertising at a deliberate pace.
With the new technology being tested in limited markets, Yahoo wants to take its time putting the new algorithms into full usage worldwide.
They have said in a previous earnings announcement the same thing they said in the latest one- they aren’t in a rush to push the upgraded search engine into production.
Yahoo CEO Terry Semel spoke about the new technology during the company’s Tuesday evening conference call with analysts.
They plan to make it available in three phases, with the third representing the debut of better ranking for contextual advertising, based on relevance.
“This new design will rank listings based on price paid as well as incorporating other variables,” said Semel.
Search advertising has been a weak spot in Yahoo’s otherwise impressive increase in revenue for the first quarter.
The company has attracted big-time advertisers and induced them to purchase premium advertising placement on the Yahoo website.
They have enjoyed particular success on the main page for Yahoo.com, with American Express being the latest to display in the high-priced top-right position as of press time.
Yahoo has recently moved to improve support and communication for its Publisher Network, where contextual advertising delivered by Yahoo will appear on network member websites.
The company debuted a new blog that focuses on site publisher tips and other content related to displaying Yahoo ads.
Like other tech companies, Yahoo took a hit to its earnings as it included stock-based compensation expenses in the calculations for the first time; eBay suffered similarly for the same reason.
Yahoo’s net income of $160 million, 11 cents per share, was off the same quarter last year by about $35 million. Adjusted net income excluding the stock expense, net of tax, was $231 million for earnings of 15 cents per share.
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David Utter is a staff writer for Murdok covering technology and business.
