Shares slip in late trades after the company delivers an in-line adjusted profit for the quarter.
NEW YORK (TheStreet) -- Yahoo!(:YHOO) shares dropped 1.2% to $15.51 in after-hours trading on Tuesday after the company said its adjusted revenue fell 3% during the fourth quarter because of weak display ad sales.
The struggling Internet giant, which has been trying to stave off competition in the online ad space from rivals Facebook and Google(:GOOG), is trying to turn itself around under new CEO Scott Thompson. Thompson joined Yahoo! earlier this month from PayPal.
The company reported adjusted earnings of 24 cents a share, which was flat from last year. Revenue excluding traffic acquisition costs, or TAC, came in at $1.17 billion.
Analysts were expecting earnings of 24 cents per share on revenue of $1.19 billion in the period.
Display advertising -- Yahoo's core business which includes graphic ads like banners, interactive media and video -- fell 4% during the quarter to $546 million. This compares to overall growth in the U.S. display advertising market to $14.8 billion in 2012, up from $12.3 billion in the prior year, according to eMarketer.
For its fiscal first quarter ending in March, the company expects revenue excluding TAC to range from $1.025 billion to $1.105 billion, which would be a sequential decline. Wall Street's current consensus estimate is for revenue of $1.078 billion in the March-ending period.
--Written by Olivia Oran in New York.
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