Even with all the drama at Yahoo (NASDAQ:YHOO) over the years, the company was able to maintain a strong business in mail, search and its homepage. But unfortunately, some signs now indicate that even these strengths are fading.
According to a recent report form comScore for the period of November and December, Yahoo’s year-over-year declines in search came to 28% and 24%, respectively, for those months. Mail saw drops of 16% and 12%, respectively.
The only good news was that the homepage continued to post gains, with monthly unique visitors reaching 114 million in December, up from 109 million a year ago.
It’s not clear why Yahoo is seeing deterioration. Perhaps one key reason is that the company has been lagging with mobile. Or maybe Facebook (NASDAQ:FB) and Google (NASDAQ:GOOG) are taking market share away.
Whatever the reason, Yahoo should be concerned. It relies heavily on advertising revenues, which are based on traffic. So, if the traffic numbers continue to trail off, new CEO Marissa Mayer will have an even tougher challenge trying to pull off a turnaround.
Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He is also the author of “How to Create the Next Facebook” and “High-Profit IPO Strategies: Finding Breakout IPOs for Investors and Traders.” Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities.