This analysis was first published in SvD Näringsliv, in Swedish, on October 11th, 2023. This piece was translated from Swedish by Claude. Some phrasing may differ from a human translation.
They were the centre of the entire internet during the 1990s, but lost that position to the tech giants. Now there is talk of a possible new stock listing. Has the legendary internet company Yahoo come back to life?
Jim Lanzone looked pleased and flattered at a so-called fireside chat — a relaxed on-stage interview format — about how he thought when he took on the legendary internet company Yahoo. Once one of the world’s most popular search engines, it had become the archetype of what used to be called a “homepage” on the internet. But that was many years ago.
“The problem with being a good turnaround guy is that people keep calling with more turnarounds,” said the interviewer.
The comment was a nod to the fact that people who can come in and turn around struggling companies are rare — and tend to keep ending up in similar situations.
Lanzone laughed, but quickly changed the subject. He had been involved in turning around companies before — including another search engine, Ask.com. But he did not seem to think Yahoo was a typical turnaround case at all. It was mostly just misunderstood.
The former internet giant Yahoo appears to be heading back into the spotlight. After serving as many people’s first internet experience from the late 1990s onwards, it was absorbed into telecom giant Verizon’s vague content play — alongside another classic internet company, AOL — between 2015 and 2017.
Despite its low profile, Yahoo managed to retain a loyal user base across many of the services it offered. The problem was more about explaining to the outside world what Yahoo actually was. The company was involved in so many different things — from photo storage to stock quotes — that something of an identity crisis emerged.
Things got darker when owner Verizon — as is so often the case with telecom companies — suddenly changed strategy. Swede Hans Vestberg was called in and announced they would focus on the core business: mobile networks and 5G. The value of Yahoo and AOL was written down by $4.6 billion, just 2.5 years after the deal was done. Yahoo was stuck in no-man’s land — unwanted by its owner and without focus.
The turning point came in 2021, when private equity giant Apollo Global Management (yes, the same one that has been involved with the airline SAS) bought out Yahoo and AOL for $5 billion. Jim Lanzone was then brought in as CEO.
Since then, Yahoo has undergone an impressive transformation and streamlining. It has sold off businesses in video, search technology, and the rights to its Japanese operations — something SoftBank bought for $1.6 billion. Instead, several acquisitions have been made in both financial and content services, to strengthen the areas that are working well. Among them is Yahoo Finance with 100 million users, Yahoo Mail with 225 million users, and Yahoo News with 900 million monthly readers.
For those who know their internet history, it is impossible not to remember when Yahoo was in exactly that company — among the most visited sites in the world, with services you could hardly avoid if you wanted to use the internet.
Being that important attracted attention even then. In early 2008, Microsoft tried to buy Yahoo for $41.6 billion — more than 450 billion kronor at today’s exchange rate. The bid went as high as $47 billion. But then-CEO and co-founder Jerry Yang turned it down with what is now an infamous quote: “we believe Microsoft’s bid substantially undervalues Yahoo.”
Yang badly misjudged the situation, and less than ten years later the company had been sold for roughly one tenth of what Microsoft had once offered.
A comeback may now be visible on the horizon. Lanzone’s Yahoo has cleaned up the company and found a new core to build on. The search engine that was once the source of its greatness has been set aside in favour of editorial investments in finance, news, and sports. Yahoo Finance now also offers trading and mortgage services, expanding it into a broader financial platform. Talk of a potential IPO is linked to Apollo’s likely desire for an exit — SoftBank is already an investor.
This is an internet comeback story. There are not many companies capable of sustaining such a long gap between their period of greatness and a potential second act.
The glory days will be hard to match again, but Yahoo does seem to be making a comeback — now more as a modern media company than a search engine. CEO Jim Lanzone has reason to be satisfied. He now has the opportunity to reintroduce Yahoo to an entirely new generation of internet users.
