Cost cutting helps lead to profit improvement for Yahoo
Yahoo Inc. shuffled through another quarter of sluggish growth, a performance that may further test the patience of the Internet company’s already restless shareholders.
The third-quarter results announced Tuesday also seem likely to intensify the pressure on CEO Carol Bartz to end a four-year financial funk amid speculation that the company could become a takeover target because of its slumping stock price.
Yahoo made some progress on the earnings front, thanks largely to cost-cutting moves since Yahoo hired Bartz to orchestrate a turnaround 21 months ago.
Net income totaled $396 million, or 29 cents per share, in the three months ended Sept. 30. That was more than double earnings of $186 million, or 13 cents per share, a year earlier.
But this year’s figures included a one-time gain of $186 million from Yahoo’s sale of its help-wanted site, HotJobs, to Monster Worldwide Inc. If not for that boost, Yahoo’s earnings would have been 16 cents per share, a penny above the average estimate among analysts surveyed by Thomson Reuters.
Revenue rose 1.3 percent to $1.6 billion from $1.58 billion.
U.S. sales help Coca-Cola profits rise 8.4 percent in quarter
U.S. sales for Coca-Cola Co. extended their rebound in the third-quarter, coupling with strong performance abroad to push the world’s largest soft drink maker’s net income up 8.4 percent.
The second consecutive quarter of improvements in its North American drinks business is encouraging news for Coca-Cola after four years of declines. The company also raised the value of shares it expects to buy back this year to $2 billion from $1.5 billion.
The company, based in Atlanta, said Tuesday it earned $2.06 billion or 88 cents per share in the three months ended Oct. 1, up from $1.9 billion or 81 cents per share, a year earlier. Excluding one-time items related to restructuring, the company earned 92 cents per share.
Revenue rose 4.7 percent to $8.43 billion.
Analysts polled by Thomson Reuters expected the company to earn 89 cents per share on revenue of $8.3 billion in the quarter, Their estimates typically exclude one-time items.
Satellite operator TerreStar files for bankruptcy protection
TerreStar Corp., which operates the world’s largest commercial satellite and recently started selling a satellite phone through AT&T Inc., filed for Chapter 11 bankruptcy protection on Tuesday in an effort to pare debt from its balance sheet.
TerreStar also said EchoStar Corp., its largest secured creditor, has agreed to provide $75 million in financing to help it continue to run its business while in bankruptcy court.
"After careful consideration of all available alternatives, we determined filing chapter 11 was a necessary and prudent step to strengthen our balance sheet and gain financial flexibility in order to access liquidity and position TerreStar Networks as a stronger, healthier company," President and CEO Jeffrey W. Epstein said in a statement.
EchoStar, a maker of equipment such as set-top boxes for satellite TV providers, has agreed to support a restructuring based on giving secured noteholders stock in exchange for debt, and a $100 million stock rights offering that would pay for TerreStar’s exit from Chapter 11.
China raises key interest rate in step to control inflation
China raised its key interest rate Tuesday for the first time since the global crisis. The move is intended to control inflation and rapid growth even as other Asian economies move to keep their recoveries on track.
The rate hike, China’s first since 2007, reflected Beijing’s focus on guiding growth to a more sustainable level rather than revving up the economy. China’s economy grew 10.3 percent in the second quarter.
The People’s Bank of China, the central bank, might have felt forced to act after bank lending surged in September despite government orders to control credit, said economist Mark Williams of Capital Economics in London.
The rate on a one-year loan was raised by 0.25 percentage points to 5.56 percent effective Wednesday, said the central bank. The one-year rate paid on deposits was raised, also by 0.25 percentage points, to 2.5 percent.
Workers end five-day strike at Hilton Hawaiian Village Resort
A five-day union worker strike at Hawaii’s largest hotel ended Tuesday, but the fate of Oahu’s biggest fall convention remains in doubt.
About 1,500 union workers from UNITE HERE Local 5 returned to work at the Hilton Hawaiian Village Resort and Spa in Waikiki after they walked off the job Thursday to protest job security, benefits and wages.
The Wisconsin-based International Foundation of Employee Benefit Plans, which counts the International Brotherhood of Teamsters among its largest clients, has threatened to cancel its Nov. 14-17 conference in Honolulu if labor issues aren’t resolved.
The conference has been booked since 1986 and was expected to bring more than 10,000 visitors to Hawaii and generate about $40 million in economic activity, the Honolulu Star-Advertiser reported Tuesday.
Tribal council stops sharing casino revenue with state
The St. Regis Mohawk Tribal Council has stopped sharing revenue from the casino along New York’s northern border with the state, claiming the exclusivity provision of its gambling compact has been violated.
Tribal Chief Mark Garrow said the second-quarter check for about $4.9 million has not been sent. He declined to specify what state officials did against the Mohawks’ seven-county exclusive rights to install and operate slot machines.
Garrow said the move isn’t related to Gov. David Paterson’s administration attempts to tax lucrative tribal cigarette sales to non-Indians and isn’t coordinated with the Seneca tribe’s withholding more than $200 million from its three casinos in western New York. The Mohawks’ letter to the administration was sent last week, he said.
Provincial government won’t support bid for Potash Corp.
The Canadian provincial government of Saskatchewan will not support BHP Billiton’s bid for Potash Corp., government sources said Tuesday.
Australia’s BHP Billiton Ltd. launched a $38.6 billion takeover bid in August for the world’s largest fertilizer company after Potash directors rejected its offer. The company hoped to profit from what it expects will be rising fertilizer demand in China and India. Potash, a key fertilizer ingredient, is critical to international food security.
Canada’s federal government can block a foreign takeover if it’s not a "net benefit" to Canada. The federal government has asked for input from the provincial Saskatchewan government, who sources say will not support the deal.
Canada’s Conservative government is expected to listen to the provincial government, which is also a right-of-center party.
Get your e-books, newspapers over Starbucks’ digital network
Starbucks is adding a venti-sized dollop of free books, news and entertainment to its Internet offerings starting today .
The coffee chain’s new digital network promises customers free e-books, movies and other exclusives, including free access to some paid Web sites such as The Wall Street Journal. It’s meant to get customers spending more on drinks and content they buy through the site.
The move comes as Starbucks faces steep competition from McDonald’s Corp. and other fast-food chains pushing increasingly fancy coffee drinks. But it also offers Starbucks a chance to make money by selling songs, e-books and other material to customers who linger over its free Wi-Fi, which recorded 30 million logins last month.Special-edition Camaros sold out in a flash
DETROIT — In just three minutes Tuesday, customers bought all 100 of the special-edition 2011 Chevrolet Camaro convertibles offered in the Neiman Marcus Christmas Book.
The new owners claimed the $75,000 cars through a telephone reservation process, General Motors Co. said. The cars will be delivered next spring.
Only 100 of the cars were built. They come in a special shade, Deep Bordeaux, with a matching fabric top.
All have a 6.2-liter V-8 engine, but customers can choose an automatic or a manual transmission.
THE ASSOCIATED PRESS