Yahoo boss has squandered her second chance

Failure shouldn't have spelled career disaster, but a catalogue of missteps has changed that

By Jennifer Saba

NEW YORK (Reuters Breakingviews) - Marissa Mayer took on a Sisyphean task when she became Yahoo chief executive in 2012. Failure shouldn't have spelled career disaster. But a catalog of missteps has changed that. Mayer has probably squandered her chance of another prominent corner office.

Four years ago, Mayer's arrival brought hope to a company that was churning through CEOs and had caught the unwanted attention of activist investor Dan Loeb. The former Google engineer was a rarity: A woman with the background, tech skills and style to put hoodie-wearing dudes to shame.

After Mayer showed up, Yahoo's core advertising and search deteriorated further. EBITDA plunged from $1.7 billion (all dollars US) in 2012 to an estimated $814 million this year, according to Thomson Reuters data. Revenue net of traffic acquisition costs is forecast to slide to $3.5 billion this year, 15 per cent down on 2015. Attempts to create growth with mobile, video and other initiatives Mayer dubbed "Mavens" made too little impact, too slowly. Splashy acquisitions failed, too. Yahoo has written down almost all of the $1.1 billion it spent on social-media site Tumblr in 2013.

Yahoo's 15 per cent stake in Chinese e-commerce giant Alibaba contributes the vast majority of the company's $37-billion market value. That's not Mayer's fault. Where she and her colleagues erred, though, was in waffling and changing their minds over how to deal with the huge asset and its associated U.S. tax liability.

The latest corporate indignities are the two giant hacks of Yahoo user data that happened in 2013 and 2014 but were only recently disclosed. Security should be central to an internet business anyway, but the delay suggests Mayer wasn't focused on the issue. On top of that, her deal to sell Yahoo's core business to Verizon — salvaging something from her tenure — may now be in danger. There has also been little sign of her publicly reassuring customers.

The idea of second chances is appealing and Mayer may be courted again. After all, Steve Jobs famously made a comeback at Apple. But some failed CEOs haven't had such good fortune. Neither Chuck Prince, who left Citigroup in 2007 as the bank reeled from the beginnings of the financial crisis, nor Carly Fiorina, fired from Hewlett-Packard after her disastrous purchase of Compaq, has headed another company. At this point, Mayer's future — at least at a public company — looks just as hacked.

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