Goodwill and Intangible Asset Disclosure
Adjustments to Financial Statements: Removal of Goodwill
Adjusted Financial Ratios: Removal of Goodwill (Summary)
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Yahoo! Inc., balance sheet: goodwill and intangible assets

US$ in thousands

	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
Customer, affiliate, and advertiser related relationships	284,216)	355,568)	369,914)	293,612)	162,389)
Developed technology and patents	128,732)	170,289)	206,422)	261,435)	270,485)
Tradenames, trademarks, and domain names	45,976)	67,119)	107,841)	107,381)	50,382)
Intangible assets, gross carrying amount	458,924)	592,976)	684,177)	662,428)	483,256)
Accumulated amortization	(297,280)	(245,707)	(213,335)	(244,620)	(329,283)
Intangible assets, net	161,644)	347,269)	470,842)	417,808)	153,973)
Goodwill	415,809)	808,114)	5,163,654)	4,679,648)	3,826,749)
Intangible assets and goodwill, net	577,453)	1,155,383)	5,634,496)	5,097,456)	3,980,722)

Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).

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Item	Description	The company
Intangible assets, net	Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges.	Yahoo! Inc. intangible assets, net decreased from 2014 to 2015 and from 2015 to 2016.
Goodwill	Amount after accumulated impairment loss of an asset representing future economic benefits arising from other assets acquired in a business combination that are not individually identified and separately recognized.	Yahoo! Inc. goodwill decreased from 2014 to 2015 and from 2015 to 2016.
Intangible assets and goodwill, net	Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges.	Yahoo! Inc. intangible assets and goodwill, net decreased from 2014 to 2015 and from 2015 to 2016.

Yahoo! Inc., adjustments to financial statements

US$ in thousands

	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
Adjustment to Total Assets
Total assets (as reported)	48,083,079)	45,203,966)	61,960,344)	16,804,959)	17,103,253)
Less: Goodwill	415,809)	808,114)	5,163,654)	4,679,648)	3,826,749)
Total assets (adjusted)	47,667,270)	44,395,852)	56,796,690)	12,125,311)	13,276,504)
Adjustment to Total Yahoo! Inc. Stockholders’ Equity
Total Yahoo! Inc. stockholders’ equity (as reported)	31,049,283)	29,043,537)	38,741,837)	13,074,909)	14,560,200)
Less: Goodwill	415,809)	808,114)	5,163,654)	4,679,648)	3,826,749)
Total Yahoo! Inc. stockholders’ equity (adjusted)	30,633,474)	28,235,423)	33,578,183)	8,395,261)	10,733,451)
Adjustment to Net Income (loss) Attributable To Yahoo! Inc.
Net income (loss) attributable to Yahoo! Inc. (as reported)	(214,321)	(4,359,082)	7,521,731)	1,366,281)	3,945,479)
Add: Goodwill impairment charge	394,901)	4,460,837)	88,414)	63,555)	—)
Net income (loss) attributable to Yahoo! Inc. (adjusted)	180,580)	101,755)	7,610,145)	1,429,836)	3,945,479)

Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).

Yahoo! Inc., Financial Data: Reported vs. Adjusted

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Yahoo! Inc., adjusted financial ratios

	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
Net Profit Margin
Reported net profit margin	-4.15%	-87.74%	162.87%	29.19%	79.12%
Adjusted net profit margin	3.49%	2.05%	164.79%	30.55%	79.12%
Total Asset Turnover
Reported total asset turnover	0.11	0.11	0.07	0.28	0.29
Adjusted total asset turnover	0.11	0.11	0.08	0.39	0.38
Financial Leverage
Reported financial leverage	1.55	1.56	1.60	1.29	1.17
Adjusted financial leverage	1.56	1.57	1.69	1.44	1.24
Return on Equity (ROE)
Reported ROE	-0.69%	-15.01%	19.42%	10.45%	27.10%
Adjusted ROE	0.59%	0.36%	22.66%	17.03%	36.76%
Return on Assets (ROA)
Reported ROA	-0.45%	-9.64%	12.14%	8.13%	23.07%
Adjusted ROA	0.38%	0.23%	13.40%	11.79%	29.72%

Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).

Financial ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Yahoo! Inc. adjusted net profit margin ratio deteriorated from 2014 to 2015 but then slightly improved from 2015 to 2016.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Yahoo! Inc. adjusted total asset turnover ratio improved from 2014 to 2015 but then slightly deteriorated from 2015 to 2016.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Yahoo! Inc. adjusted financial leverage ratio decreased from 2014 to 2015 and from 2015 to 2016.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Yahoo! Inc. adjusted ROE deteriorated from 2014 to 2015 but then slightly improved from 2015 to 2016.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Yahoo! Inc. adjusted ROA deteriorated from 2014 to 2015 but then slightly improved from 2015 to 2016.

Yahoo! Inc., Financial Ratios: Reported vs. Adjusted

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	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
As Reported
Selected Financial Data (US$ in thousands)
Net income (loss) attributable to Yahoo! Inc.	(214,321)	(4,359,082)	7,521,731)	1,366,281)	3,945,479)
Revenue	5,169,135)	4,968,301)	4,618,133)	4,680,380)	4,986,566)
Profitability Ratio
Net profit margin¹	-4.15%	-87.74%	162.87%	29.19%	79.12%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income (loss) attributable to Yahoo! Inc.	180,580)	101,755)	7,610,145)	1,429,836)	3,945,479)
Revenue	5,169,135)	4,968,301)	4,618,133)	4,680,380)	4,986,566)
Profitability Ratio
Adjusted net profit margin²	3.49%	2.05%	164.79%	30.55%	79.12%

Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).

2016 Calculations

¹ Net profit margin = 100 × Net income (loss) attributable to Yahoo! Inc. ÷ Revenue
= 100 × -214,321 ÷ 5,169,135 = -4.15%

² Adjusted net profit margin = 100 × Adjusted net income (loss) attributable to Yahoo! Inc. ÷ Revenue
= 100 × 180,580 ÷ 5,169,135 = 3.49%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Yahoo! Inc. adjusted net profit margin ratio deteriorated from 2014 to 2015 but then slightly improved from 2015 to 2016.

	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
As Reported
Selected Financial Data (US$ in thousands)
Revenue	5,169,135)	4,968,301)	4,618,133)	4,680,380)	4,986,566)
Total assets	48,083,079)	45,203,966)	61,960,344)	16,804,959)	17,103,253)
Activity Ratio
Total asset turnover¹	0.11	0.11	0.07	0.28	0.29
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Revenue	5,169,135)	4,968,301)	4,618,133)	4,680,380)	4,986,566)
Adjusted total assets	47,667,270)	44,395,852)	56,796,690)	12,125,311)	13,276,504)
Activity Ratio
Adjusted total asset turnover²	0.11	0.11	0.08	0.39	0.38

Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).

2016 Calculations

¹ Total asset turnover = Revenue ÷ Total assets
= 5,169,135 ÷ 48,083,079 = 0.11

² Adjusted total asset turnover = Revenue ÷ Adjusted total assets
= 5,169,135 ÷ 47,667,270 = 0.11

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Yahoo! Inc. adjusted total asset turnover ratio improved from 2014 to 2015 but then slightly deteriorated from 2015 to 2016.

	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
As Reported
Selected Financial Data (US$ in thousands)
Total assets	48,083,079)	45,203,966)	61,960,344)	16,804,959)	17,103,253)
Total Yahoo! Inc. stockholders’ equity	31,049,283)	29,043,537)	38,741,837)	13,074,909)	14,560,200)
Solvency Ratio
Financial leverage¹	1.55	1.56	1.60	1.29	1.17
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted total assets	47,667,270)	44,395,852)	56,796,690)	12,125,311)	13,276,504)
Adjusted total Yahoo! Inc. stockholders’ equity	30,633,474)	28,235,423)	33,578,183)	8,395,261)	10,733,451)
Solvency Ratio
Adjusted financial leverage²	1.56	1.57	1.69	1.44	1.24

Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).

2016 Calculations

¹ Financial leverage = Total assets ÷ Total Yahoo! Inc. stockholders’ equity
= 48,083,079 ÷ 31,049,283 = 1.55

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Yahoo! Inc. stockholders’ equity
= 47,667,270 ÷ 30,633,474 = 1.56

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Yahoo! Inc. adjusted financial leverage ratio decreased from 2014 to 2015 and from 2015 to 2016.

	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
As Reported
Selected Financial Data (US$ in thousands)
Net income (loss) attributable to Yahoo! Inc.	(214,321)	(4,359,082)	7,521,731)	1,366,281)	3,945,479)
Total Yahoo! Inc. stockholders’ equity	31,049,283)	29,043,537)	38,741,837)	13,074,909)	14,560,200)
Profitability Ratio
ROE¹	-0.69%	-15.01%	19.42%	10.45%	27.10%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income (loss) attributable to Yahoo! Inc.	180,580)	101,755)	7,610,145)	1,429,836)	3,945,479)
Adjusted total Yahoo! Inc. stockholders’ equity	30,633,474)	28,235,423)	33,578,183)	8,395,261)	10,733,451)
Profitability Ratio
Adjusted ROE²	0.59%	0.36%	22.66%	17.03%	36.76%

Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).

2016 Calculations

¹ ROE = 100 × Net income (loss) attributable to Yahoo! Inc. ÷ Total Yahoo! Inc. stockholders’ equity
= 100 × -214,321 ÷ 31,049,283 = -0.69%

² Adjusted ROE = 100 × Adjusted net income (loss) attributable to Yahoo! Inc. ÷ Adjusted total Yahoo! Inc. stockholders’ equity
= 100 × 180,580 ÷ 30,633,474 = 0.59%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Yahoo! Inc. adjusted ROE deteriorated from 2014 to 2015 but then slightly improved from 2015 to 2016.

	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
As Reported
Selected Financial Data (US$ in thousands)
Net income (loss) attributable to Yahoo! Inc.	(214,321)	(4,359,082)	7,521,731)	1,366,281)	3,945,479)
Total assets	48,083,079)	45,203,966)	61,960,344)	16,804,959)	17,103,253)
Profitability Ratio
ROA¹	-0.45%	-9.64%	12.14%	8.13%	23.07%
Adjusted for Goodwill
Selected Financial Data (US$ in thousands)
Adjusted net income (loss) attributable to Yahoo! Inc.	180,580)	101,755)	7,610,145)	1,429,836)	3,945,479)
Adjusted total assets	47,667,270)	44,395,852)	56,796,690)	12,125,311)	13,276,504)
Profitability Ratio
Adjusted ROA²	0.38%	0.23%	13.40%	11.79%	29.72%

Based on: 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31).

2016 Calculations

¹ ROA = 100 × Net income (loss) attributable to Yahoo! Inc. ÷ Total assets
= 100 × -214,321 ÷ 48,083,079 = -0.45%

² Adjusted ROA = 100 × Adjusted net income (loss) attributable to Yahoo! Inc. ÷ Adjusted total assets
= 100 × 180,580 ÷ 47,667,270 = 0.38%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Yahoo! Inc. adjusted ROA deteriorated from 2014 to 2015 but then slightly improved from 2015 to 2016.

Yahoo! Inc. (NASDAQ:YHOO)

Analysis of Goodwill and Intangible Assets

Goodwill and Intangible Asset Disclosure

Adjustments to Financial Statements: Removal of Goodwill

Yahoo! Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Goodwill (Summary)

Yahoo! Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)