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Yahoo profits drop, online advertising slows

Yahoo has recorded an 80 percent drop in first quarter profit as online advertising slows, with many companies reducing their marketing spend in light of the financial crisis.

Yahoo said first-quarter net income fell to $US117.6 million ($165.7 million), from $US536.8 million in the same period a year earlier.

The decline is said to be as a result of online advertising revenue declining 13 percent worldwide on the same period last year, with the search engine giant relying heavily on the sale of graphical display advertising.

According to Yahoo chief executive Carol Bartz, the downturn in the global economy was having a negative affect on growth, with the company expected to slash jobs to regain ground.

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