An operating lease is treated like a rental contract. Neither the leased asset nor the associated liability is reported on the lessee balance sheet, but the rights may be very similar to the rights of an owner. The lessee only records the lease payments as a rental expense in income statement.

Present Value of Future Operating Lease Payments (before Adoption of FASB Topic 842)
Adjustments to Financial Statements for Operating Leases
Adjusted Financial Ratios for Operating Leases (Summary)
Adjusted Total Asset Turnover
Adjusted Debt to Equity
Adjusted Return on Assets (ROA)

Yahoo! Inc., future operating lease payments (before adoption of FASB Topic 842)

US$ in thousands

	Dec 31, 2016	Dec 31, 2015	Dec 31, 2014	Dec 31, 2013	Dec 31, 2012
Total undiscounted future operating lease payments	408,000)	462,000)	555,000)	532,000)	438,000)
Discount rate¹	9.74%	8.46%	9.41%	10.29%	11.70%

Total present value of future operating lease payments	303,384)	355,383)	409,707)	388,502)	331,218)

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).

¹ Internal rate of return on capital leases

2016 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at 9.74%
2017	103,000)	2017	103,000)	93,858)
2018	75,000)	2018	75,000)	62,278)
2019	60,000)	2019	60,000)	45,400)
2020	47,000)	2020	47,000)	32,407)
2021	37,000)	2021	37,000)	23,248)
2022 and thereafter	86,000)	2022	37,000)	21,184)
		2023	37,000)	19,304)
		2024	12,000)	5,705)
Total:	408,000)		408,000)	303,384)

Based on: 10-K (reporting date: 2016-12-31).

2015 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at 8.46%
2016	121,000)	2016	121,000)	111,562)
2017	91,000)	2017	91,000)	77,357)
2018	63,000)	2018	63,000)	49,378)
2019	48,000)	2019	48,000)	34,687)
2020	35,000)	2020	35,000)	23,320)
2021 and thereafter	104,000)	2021	35,000)	21,501)
		2022	35,000)	19,824)
		2023	34,000)	17,755)
Total:	462,000)		462,000)	355,383)

Based on: 10-K (reporting date: 2015-12-31).

2014 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at 9.41%
2015	141,000)	2015	141,000)	128,873)
2016	102,000)	2016	102,000)	85,209)
2017	74,000)	2017	74,000)	56,502)
2018	53,000)	2018	53,000)	36,987)
2019	43,000)	2019	43,000)	27,427)
2020 and thereafter	142,000)	2020	43,000)	25,068)
		2021	43,000)	22,912)
		2022	43,000)	20,942)
		2023	13,000)	5,787)
Total:	555,000)		555,000)	409,707)

Based on: 10-K (reporting date: 2014-12-31).

2013 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at 10.29%
2014	141,000)	2014	141,000)	127,845)
2015	109,000)	2015	109,000)	89,610)
2016	69,000)	2016	69,000)	51,433)
2017	55,000)	2017	55,000)	37,172)
2018	36,000)	2018	36,000)	22,061)
2019 and thereafter	122,000)	2019	36,000)	20,003)
		2020	36,000)	18,136)
		2021	36,000)	16,444)
		2022	14,000)	5,798)
Total:	532,000)		532,000)	388,502)

Based on: 10-K (reporting date: 2013-12-31).

2012 Calculations

Year	Future operating lease payments (as reported)	Year	Future operating lease payments (estimated)	Present value at 11.70%
2013	135,000)	2013	135,000)	120,859)
2014	106,000)	2014	106,000)	84,957)
2015	82,000)	2015	82,000)	58,838)
2016	46,000)	2016	46,000)	29,549)
2017	31,000)	2017	31,000)	17,828)
2018 and thereafter	38,000)	2018	31,000)	15,960)
		2019	7,000)	3,226)
Total:	438,000)		438,000)	331,218)

Based on: 10-K (reporting date: 2012-12-31).

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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)
Add: Operating lease right-of-use asset (before adoption of FASB Topic 842)¹	303,384)	355,383)	409,707)	388,502)	331,218)
Total assets (adjusted)	48,386,463)	45,559,349)	62,370,051)	17,193,461)	17,434,471)
Adjustment to Total Debt
Total debt (as reported)	1,322,945)	1,266,485)	1,217,423)	1,154,585)	37,000)
Add: Operating lease liability (before adoption of FASB Topic 842)²	303,384)	355,383)	409,707)	388,502)	331,218)
Total debt (adjusted)	1,626,329)	1,621,868)	1,627,130)	1,543,087)	368,218)

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).

^{1, 2} Equal to total present value of future operating lease payments.

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
Total Asset Turnover¹
Reported total asset turnover	0.11	0.11	0.07	0.28	0.29
Adjusted total asset turnover	0.11	0.11	0.07	0.27	0.29
Debt to Equity²
Reported debt to equity	0.04	0.04	0.03	0.09	0.00
Adjusted debt to equity	0.05	0.06	0.04	0.12	0.03
Return on Assets³ (ROA)
Reported ROA	-0.45%	-9.64%	12.14%	8.13%	23.07%
Adjusted ROA	-0.44%	-9.57%	12.06%	7.95%	22.63%

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).

¹ See details »

² See details »

³ See details »

Financial 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.
Adjusted debt to equity	A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity.	Yahoo! Inc. adjusted debt to equity ratio deteriorated from 2014 to 2015 but then slightly improved from 2015 to 2016.
Adjusted ROA	A profitability ratio calculated as 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)
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 Operating Leases
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	48,386,463)	45,559,349)	62,370,051)	17,193,461)	17,434,471)
Activity Ratio
Adjusted total asset turnover²	0.11	0.11	0.07	0.27	0.29

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 ÷ 48,386,463 = 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 debt	1,322,945)	1,266,485)	1,217,423)	1,154,585)	37,000)
Total Yahoo! Inc. stockholders’ equity	31,049,283)	29,043,537)	38,741,837)	13,074,909)	14,560,200)
Solvency Ratio
Debt to equity¹	0.04	0.04	0.03	0.09	0.00
Adjusted for Operating Leases
Selected Financial Data (US$ in thousands)
Adjusted total debt	1,626,329)	1,621,868)	1,627,130)	1,543,087)	368,218)
Total Yahoo! Inc. stockholders’ equity	31,049,283)	29,043,537)	38,741,837)	13,074,909)	14,560,200)
Solvency Ratio
Adjusted debt to equity²	0.05	0.06	0.04	0.12	0.03

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 Debt to equity = Total debt ÷ Total Yahoo! Inc. stockholders’ equity
= 1,322,945 ÷ 31,049,283 = 0.04

² Adjusted debt to equity = Adjusted total debt ÷ Total Yahoo! Inc. stockholders’ equity
= 1,626,329 ÷ 31,049,283 = 0.05

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Solvency ratio	Description	The company
Adjusted debt-to-equity	A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity.	Yahoo! Inc. adjusted debt-to-equity 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)
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 Operating Leases
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)
Adjusted total assets	48,386,463)	45,559,349)	62,370,051)	17,193,461)	17,434,471)
Profitability Ratio
Adjusted ROA²	-0.44%	-9.57%	12.06%	7.95%	22.63%

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 × Net income (loss) attributable to Yahoo! Inc. ÷ Adjusted total assets
= 100 × -214,321 ÷ 48,386,463 = -0.44%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as 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 Operating Leases

Present Value of Future Operating Lease Payments (before Adoption of FASB Topic 842)

Adjustments to Financial Statements for Operating Leases

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

Adjusted Financial Ratios for Operating Leases (Summary)

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

Adjusted Total Asset Turnover

Adjusted Debt to Equity

Adjusted Return on Assets (ROA)