Yahoo! now has over 430 million mobile monthly active users (MAUs), up 30% year-over-year, so it's clear the company's strategy of updating and consistently refreshing its apps is paying off. On the call, Mayer noted the Yahoo App is #1 in Apple's (AAPL) App store and #2 on Google (GOOG) Play.

Cantor Fitzgerland analyst Youssef Squali, who rates Yahoo! shares "buy" with a price target to $42 (up from $40), noted Mayer and Goldman (he of the slick purple tie and shirt) appear to be refocusing the core on growing revenues again. "After making significant progress in addressing people, products and traffic, management seems to now be making progress towards growing revenues again," Squali wrote in the note.

Yahoo!'s four key areas of business are mobile, social, video and native, with mobile seemingly getting the most attention, judging by acquisitions and how much time Mayer continues to speak about it. "When you look at the success of our mobile products, it really follows the trajectory of the virtuous cycle we've talked about over the past earnings calls," Mayer said. "We've hired incredible people; the mobile team has grown more than 130% year-over-year. Great people have built incredible products, accelerating our ability to release, iterate, and execute."

Acquisitions such as Summly and Alike power Yahoo! News Digest. Rockmelt, and Tumblr are helping build Yahoo!'s digital magazines platforms. "The Xobni team utilized their technology and our user's data to bring smarter contacts to Yahoo! Mail," Mayer said. "The teams from Distill and Bread played a key role in building our new comprehensive advertiser offering, Yahoo! Ad Manager Plus and OnTheAir developed the popular Loops feature on the Sports App. And finally PlayerScale worked to launch the Yahoo! Games network."

Mayer has not been shy about acquiring companies in the past, and it looks like the acquisitions are starting to pay off. This quarter, Yahoo! spent another $22 million to acquire 7 companies, so integration of these teams and engineers will continue to be important to Yahoo!'s future, as the core business gets more attention, following the eventual Alibaba IPO.

All of that aside, there are still major challenges for Yahoo!'s core business, as it competes with the likes of Google, Facebook (FB), Twitter (TWTR), and others for Internet advertising spend. "We believe significant challenges remain for Yahoo's core assets, and we expect the company to continue to devote significant resources toward promoting programmatic execution, international growth (U.S. was a bright spot, this quarter), and the expansion of video assets (where the company now trails AOL)," Wells Fargo analyst Peter Stabler wrote in an analyst report, upgrading shares to "outperform."

There will always be questions about Yahoo!'s core business, and whether it can return to above-industry trend growth, and allow the Sunnyvale, Calif.-based company to be thought of as more than a holding company for Alibaba and Yahoo! Japan. Mayer addressed some of this on the call, noting, "As more of our business moves to mobile, social, native and video, we think some of the terrific growth trends we are seeing, 60% last year and 98% in this first quarter in terms of year-over-year growth is likely to continue to occur. And so we've been overall investing in those key areas, driving up our mobile traffic and our mobile revenue, driving up our social presence with the acquisition and the growth and investment we are making in Tumblr and also working on our native and video offerings, because we really think that this offers great opportunities for users and for advertisers in the future. And we think that our Q1 results are indicative of some of the early signs of growth that we can see are fostering these businesses."

For now, Mayer has done enough to keep the bears off her back, while core Yahoo! returns to growth, and Alibaba continues to remain the crown jewel. It's up to Mayer and the rest of the team to keep this momentum going, otherwise, it reverts to being more of the same in Sunnyvale.

--Written by Chris Ciaccia in New York

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