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Yahoo Board Approves a $1.1B Pricetag For Tumblr

Posted by timothy on from the bedrock-or-pet-rock? dept.

TechCrunch reports that Yahoo's string of acquisitions may soon include Tumblr: "The Wall Street Journal is now reporting via Twitter that the rumored $1.1 billion cash acquisition deal for social blogging site Tumblr has been approved by Yahoo’s board of directors. The Tumblr acquisition was rumored last week, with a price tag reportedly north of $1 billion, which appears to be accurate if the WSJ’s sources are correct." The article notes, too, that "Yahoo had only $1.2 billion cash on hand as of its most recent quarterly earnings, which makes an all-cash offer for Tumblr a lot more of a stretch than it would be for someone like Apple, or even Facebook, which acquired Instagram for $1 billion in a mix of both cash and stock."

9 of 142 comments (clear)

  1. Strange by XPeter · · Score: 5, Funny

    They could've bought YouPorn for a lot less.

    --
    "The difference between genius and stupidity is that genius has it's limits" - Albert Einstein
    1. Re:Strange by popo · · Score: 5, Insightful

      Not strange at all. Marissa Mayer isn't capable of doing much besides making overpriced acquisitions and hires.

      Here's (yet another) social blogging platform with no clear revenue model.

      --
      ------ The best brain training is now totally free : )
    2. Re:Strange by gweihir · · Score: 5, Insightful

      Current stock prices are not a predictor for the future. Well understood by anybody that cared to find out.

      --
      Most ACs are not even worth the keystrokes to insult them. Be generically insulted by this and ignored otherwise.
  2. Let's see by Intrepid+imaginaut · · Score: 5, Interesting

    From wiki: Tumblr made $13 million in revenue in 2012 and hopes to make $100 million in 2013. So far, Tumblr has taken $125 million in funding from its backers. Tumblr reportedly spent $25 million to fund operations last year.

    So it's making a loss of $12 million a year and yahoo is willing to fork over $1.1 billion on the hope that it might actually make $100 million this year?

    Interesting!

    1. Re: Let's see by alen · · Score: 5, Funny

      With these numbers it's worth $10 billion

      You have to value it in eye balls

    2. Re: Let's see by Intrepid+imaginaut · · Score: 5, Funny

      As soon as I can buy my dinner with a sack of eyeballs that's just what I'll do.

  3. "Social" is a lose by Animats · · Score: 5, Insightful

    Despite all the noise, almost nobody is making money in "social". Even Facebook isn't very profitable, despite its size. The business strategy in "social" seems to be to give the service away for a few years, build a following, then crank up the density of ads until the users get fed up. Worked for Myspace, right?

    Facebook traffic peaked about a year ago. Twitter is now exploring the user's threshold of pain with "sponsored tweets". This is robocalling in another form.

    Basic truth: ads with search results are useful to users and effective for advertisers, because they're presented when the user is actively looking for something relevant. Ads on "social" are merely annoying because the user is looking at what their friends are doing.

  4. Ya-who? by tutufan · · Score: 5, Funny

    Yes, but on the plus side, they now have a brand that people think of as still being in business...

  5. Re:What a scam by fustakrakich · · Score: 5, Insightful

    Who cares why? It's a game of roulette.

    --
    “He’s not deformed, he’s just drunk!”