Shares of Yahoo!(YHOO) rallied Wednesday on the heels of an earnings announcement that was buoyed by news that the company's new ad ranking component of its highly anticipated search technology would roll out ahead of schedule.
The stock was recently up $2.08, or nearly 8%, to $29.04, reversing a selloff in six consecutive trading sessions. The new Panama system, which takes into account both an ad's click-through rate and the amount an advertiser is willing to bid, mimics the system currently used by search market leader Google(GOOG) and is intended to boost the money Yahoo! makes per search. Yahoo! management exuded confidence when talking about Panama late Tuesday, with CEO Terry Semel noting that the majority of Yahoo!'s U.S. advertiser revenue has already been transitioned to the system, and that the company will begin introducing the new system into international markets starting with Japan during the second quarter. The extra time that Yahoo! took in rolling out the new system was well worth it given its quality, CFO Sue Decker said, and the platform was put together in a way that would make future upgrades simple. Given that the system will learn which ads are more effective than others over time, Yahoo! expects the bottom line impact to grow over time.TheStreet Premium Services For Personal Service: 877-471-2967
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