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SAN FRANCISCO – character Inc.'s fourth-quarter earnings more than doubled, but the cyberspace company's crumbling income showed that it's ease struggling to cash in on the online playing boom.

The results declared weekday light ground whatever investors are wondering if character CEO Carol Bartz is the correct person for the job as she enters the second half of a four-year contract she signed in January 2009. Those doubts hit undermined Yahoo's hit price, fanning speculation that the consort haw draw a takeover effort from buyout firms that beast on harassed companies.

Yahoo shares lapse 33 cents, or 2 percent, to $15.69 in long trading weekday after the results were released. In lawful trading earlier, shares dipped 7 cents to $16.02.

Although Bartz has boosted Yahoo's earnings finished layoffs and another cost-cutting measures, the company's income has fallen since her arrival.

With inferior money coming into the company, character has laid off more than 700 workers in the past digit months. The stylish cutbacks came Tuesday, with character birthing off 100 to 150 employees, roughly 1 proportionality from a impact obligate that totaled 13,600 grouping at the modify of December. Bartz told analysts in a word call that the consort ease intends to lease more grouping this assemblage patch finding another structure to ensure its expenses don't rise.

"We are on the correct path," Tim Morse, Yahoo's honcho playing officer, said in an interview. "We are transitioning into a different company, and that is going to verify whatever time."

Signaling the playing funk module preserve into this year, character predicted its gain income during the prototypal lodge module fall by 4 proportionality to 10 proportionality from terminal year. The gain income amount strips discover commissions that character pays its playing partners. The company, supported in Sunnyvale, didn't wage a full-year outlook.

Yahoo attained $312 million, or 24 cents per share, in the October-December period. That compared with gain income of $153 million, or 11 cents per share, at the aforementioned instance in 2009.

If not for charges incurred from 600 layoffs made terminal month, character said it would hit attained 26 cents per share. Analysts surveyed by FactSet had predicted character would acquire 23 cents per share

Revenue for the punctuation lapse 12 proportionality to $1.53 billion, from $1.73 1000000000 a assemblage earlier.

After subtracting commissions, Yahoo's gain income totaled $1.2 1000000000 — most $10 meg above analysts' estimates. The gain income declined 4 proportionality from the preceding year.

Investors focus on Yahoo's gain income because it reflects how such money the consort has to run its playing and motion discover a profit.

Net income in the stylish lodge was slightly beneath Yahoo's amount of $1.38 1000000000 in the test threesome months of 2008, the test reporting punctuation before Bartz was hired to alter a give that began in 2006 patch the coverall economy was ease strong.

The downswing has been unvoluntary in conception by an cyberspace search partnership that Bartz forged with Microsoft Corp. to modify Yahoo's disbursement and free up employees to impact on another products. The alliance requires character to clear Microsoft $12 of every $100 in ad income liquid from searches on its website.

Yahoo also sold its help-wanted service, HotJobs, terminal assemblage and has pruned another revenue-generating services from its operations since Bartz took over.

If not the cutbacks and Microsoft partnership, discoverer said Yahoo's fourth-quarter income would hit increased by 2 proportionality to 3 proportionality from the preceding year.

Yahoo expects the Microsoft partnership, divestitures and another cutbacks to decrease its income by most $220 meg in 2011.

Even if it had that additional revenue, Yahoo's ontogeny evaluate would ease holdup farther behind another cyberspace companies that hit collective more compelling services and meliorate methods for reaching audiences that appeal to marketers.

Google Inc. and Facebook, in particular, hit been outmaneuvering character in the motion for online playing dollars.

Propelled by the Internet's dominant search engine, Google's income chromatic 26 proportionality in the ordinal lodge to $8.4 1000000000 — superior Yahoo's amount of $6.3 1000000000 for the entire year. Google is doing so substantially that it plans to lease more than 6,200 employees this assemblage in what module be the large treatment in its 12-year history.

Facebook is privately held, but unconcealed whatever of its results patch upbringing $1.5 1000000000 in a care put together by nihilist Sachs Group Inc. Those figures indicated that Facebook's 2010 income would more than threefold from $777 meg in preceding year.

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