Marissa Mayer sees video as the “next generation” of the company’s display business. The Yahoo CEO put a spotlight on the company’s growing investment in original video content Tuesday during a call with investors following a report of the company’s disappointing Q2 financial results.
Yahoo will have to work quickly to seize this opportunity for growth, however. Display revenues fell by 8% in the second quarter of this year, bringing in $436 million versus $472 million for the same period last year. Overall revenues declined by 4% to to 1.08 billion from 1.135 billion. Although more ads were sold, the price-per-ad decreased approximately 24% compared to the second quarter of 2013.
Mayer highlighted Yahoo’s investment in original content and growth in audiences, saying: “Fundamentally, premium content draws premium advertisers and we have had early success bringing these opportunities to market.”
In Q2, Yahoo Screen saw a 22% quarter-over-quarter increase in daily active users and a 29% increase in daily active page views, Mayer said, representing a 67% increase year-over-year.
“Our video business is still early, but these initial strides are building the foundation for more meaningful user and advertiser growth in the future,” she said.
In a Netflix-esque move, Yahoo recently announced it has ordered the sixth season of Community, a cult-favorite show that was cancelled by NBC in May. It also this week began the rollout of its daily live concert streaming series, and will launch two original comedies announced at the NewFronts (pictured), Sin City Saints and Other Space.
“Yahoo has always been an incredibly strong place for brands to reach their audience and brand advertisers have and will continue to migrate to digital video,” Mayer said Tuesday.
One of Yahoo’s newest assets in streaming is RayV, a mobile-focused company that allows users to curate playlists and distribute high-quality videos. Yahoo announced last week it has acquired the Israeli startup, though financial details weren’t disclosed.
“(RayV) will be a key asset in boosting our underlying technology in the video space,” Mayer said. “So what we see here is the opportunity in video to evolve as the next generation of our display business.”