Yahoo Writes Down Tumblr Value as Sale May Be Nearing

Yahoo's latest earnings report leaves no doubt the internet company is stuck in a downward spiral. The company managed to beat Wall Street's limited expectations for revenue in the April-June quarter. But after subtracting commissions paid to its partners, Yahoo said its revenue fell 19 percent from a year earlier, while its loss widened to $440 million.

Yahoo also reported Monday that it's writing down $482 million in charges related to the declining value of Tumblr, the social-blogging service that Yahoo acquired for $1.1 billion in 2013. Combined with an earlier write-down of $230 million, that indicates Tumblr's value has plunged by almost two-thirds.

What remains unclear is whether Yahoo will abort its long-running turnaround attempts and sell its operations in a move that would likely end the four-year reign of CEO Marissa Mayer.

Mayer had little to say about a possible sale on Monday, as she released the latest in a succession of dismal earnings reports. She told investors the company is carefully evaluating bids but added, "We have no announcement today." The Sunnyvale, California, company began soliciting bids five months ago.

A decision may come soon, though. Monday was the deadline for final offers.

The list of prospective buyers includes two telecommunications providers, Verizon Communications and AT&T Inc., which are hoping to broaden their array of digital services. Also in the running is a group led by Quicken Loans founder Dan Gilbert with the backing of billionaire investor Warren Buffett. Several private equity firms that specialize in buying troubled companies are also believed to be in the running.

Investors have been betting a deal will get done, partly because Yahoo recently added a sale proponent, Jeffrey Smith, and three of his allies to its 11-member board. It's the main reason that Yahoo's stock has climbed 14 percent so far this year, even as the...

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