Jerry Yang has stepped down from his role as chief executive of Yahoo. Announcing his resignation in a memo sent to Yahoo’s staff on Monday evening, Mr Yang said he would continue as acting CEO until the board appoints a successor.

Yang, a co-founder of Yahoo, has been CEO for the last year and a half after he took over from Terry Semel, a Hollywood studio boss that Yang had chosen for the job. Unfortunately, during this time, Yahoo has been marred by a declining share price, a botched merger with Microsoft, board room strife, and a decision to retrench 1,500 employees.

Yahoo has hired head hunters Heidrick & Struggles to help look for candidates. Upon appointing Jerry Yang’s successor, the outgoing CEO plans to remain actively involved at Yahoo as a key executive and member of the board.

Yahoo’s share price increased by over 4 percent in after-hours trading following the news, indicating that shareholders are pleased that Jerry will no longer be CEO.

Source: Brad Stone and Claire Cain Miller, “Jerry Yang, Yahoo Chief, Steps Down”, The New York Times, November 17, 2008

While Wall Street accepted Yahoo’s dim performance, it punished Apple. But not because of poor performance.

Apple’s PC sales rose in the third quarter to June 30, and the company continued to dominate the digital music player business. But Apple’s hints that it may lower prices, as well as concerns over CEO Steve Jobs’ health, apparently caused the share price to fall from $166.29 to $149.70 on Monday night in after-hours trading.

Apple’s revenue in the third quarter was $7.46 billion, up by 38 percent over the $5.41 billion reported at the same time last year. Its net income was up by 31 percent to $1.07 billion, or $1.19 a share, compared with $818 million, or 92 cents per share in 2007.

Gross margin was 34.8 percent, slightly lower than the 36.9 percent at the end of the second quarter in 2007. The company’s net income of $1 per share also missed analysts’ forecasts.

Source: John Markoff, “Talk of Chief’s Health Weighs on Apple’s Share Price”, July 23, 2008

Yahoo has little reason to smile. While its revenue was up 6 percent in the second quarter compared with that a year ago, its net income was down by nearly 19 percent.

The company’s revenue was $1.8 billion, compared with $1.7 billion in the same quarter in 2007. Meanwhile, net revenue - excluding commissions to advertising partners - was $1.35 billion, just 8 percent above the $1.24 billion achieved 12 months ago.

Wall Street analysts expected Yahoo to deliver net income for the quarter of $161 million or 11 cents a share. However, the search company reported net income for the quarter of $131 million, or 9 cents a share.

Yahoo was, however, satisfied with the results, noting that profit had been hit by $22 million in costs related to negotiating with Microsoft, the proxy fight with Carl C. Icahn, and related lawsuits.

Despite the poor results, no one, it seems, was all that surprised. Yahoo’s share price increased to $21.89 in after-hours trading after releasing these results.

Source: Miguel Helft, “Yahoo’s Revenue Rises a Bit, but Profit Falls 18%”, July 23, 2008

Believe it or not, not all Google touches turns to gold. And despite years of success, Microsoft has faltered too.

But let’s not exaggerate - both companies posted respectable earnings results. They just missed Wall Street’s profit expectations. Unfortunately, doing so meant they suffered bruising stock price declines.

Google reported strong quarterly growth, achieving $3.87 billion in revenue, excluding commissions paid to advertising partners. However, its expenses were higher than expected, and on top of lower than expected interest income, it missed Wall Street’s earnings per share forecasts. As a result, investors drove down its share price by over 7 percent to $493 a share in after-hours trading on Thursday.

Microsoft, in record earnings, achieved $60 billion in revenue for the 2007-8 fiscal year. But it too missed Wall Street’s profit expectations, causing its stock to drop by more than 6 percent in after-hours trading.

Let’s face it. Wall Street is kinda nervous right now and even the slightest disappointment seems to send the bears into panic.

Source: Brad Stone, “In Surprise, 2 Tech Titans Disappoint”, The New York Times, July 18, 2008

Yesterday, Friday June 27, marked Bill Gates’ last day as a full time employee of Microsoft, the hugely successful and influential software company he co-founded in 1975.

Gates will remain as Microsoft’s single largest shareholder and chairman, but will no longer work at the company. He has chosen, instead, to spend more time on the philanthropic organization he and his wife founded a few years ago, the Bill and Melinda Gates Foundation.

Since he guided Microsoft from startup… to upstart IBM partner… to the company that dominated many software markets – including the operating system, office software and Internet browser markets – for  at least two decades, Bill Gates has been a giant in the computer industry. And, in the process, he managed to become, for many years, the world’s richest individual.

Much can be said about Gates’ achievements, but a key question for now is: what does the future hold for Microsoft? Its Live platform holds just 10 percent of the search market, and open source software – notably the Mozilla Firefox browser and the OpenOffice suite of applications – poses formidable challenges to Microsoft’s office software business. Meanwhile, its latest operating system release, Vista, has been widely criticized based on privacy, security, performance, and product activation concerns.

Interestingly, however, Microsoft is showing no signs of being fazed by any of this. If its $47.5 billion bid to buy rival Yahoo ended in tears, it’s Yahoo that’s crying, with senior executives leaving and angry shareholders and analysts asking what exactly Yahoo plans to do to address its share price decline and lack of clear strategy.

As Internet marketers, we owe much to Bill Gates for contributing to the opportunities we have before us – after all, have we not reaped the rewards of Gates’ vision to have a computer on every desk and in every home? Having said that, my own computer use has probably mirrored the rise and gradual decline of Microsoft as the default choice in computer technology.

I started with a Mac in the late 1980s and early 1990s, moved to Windows 95 in… you guessed it, 1995… and became a heavy user of Microsoft Office and, yes, Internet Explorer for the next decade or so. But as Google emerged from 2000 onwards, and the open source revolution gained momentum over the last few years, I now find myself using a PC running Vista… but Open Office and Mozilla for my office and Internet browsing activities respectively. As a marketer I have little inclination to recommend or buy ads on Microsoft Live, and Live is almost an afterthought when it comes to search engine optimization.

And yet, perhaps there are little known opportunities to capitalize on the market that does choose Live as its search engine of choice – older, less tech-savvy Internet users, but potentially customers, depending on your market. Moreover, I wouldn’t rule out Microsoft just yet. One of the company’s key strengths (perhaps its chief strength) has been to buy companies with promising technologies and then commercialize and market those technologies – if Microsoft can do this into the future it may still be a formidable force.

Sources: Steve Lohr, “Microsoft Seeks Path Beyond Gates’s Legacy”, The New York Times, June 27, 2008,  Wikipedia, “Criticism of Windows Vista”, Kikabink News, “Yahoo Loses More Senior Staff”, Kikabink News, June 25, 2008