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Quoth the 'MaVeNS’: Weaker Core (And Alibaba Wobble) in Yahoo Q2

Wall Street worries about weak ad business and Chinese asset spinoff.

Yahoo will be announcing its second-quarter earnings this afternoon and analysts have zero expectations for the Internet giant, except yet another weak report on its core business.

Even CEO Marissa Mayer’s made-up word for what she has bet the company’s next phase of growth on — “MaVeNS,” or mobile, video, native and social advertising — has underwhelmed Wall Street. That’s because, despite growth, it has not offset continued precipitous declines in its premium display business.

Said SunTrust’s Robert Peck in handing Mayer a C grade for her performance: “There still remain many core challenges; chief among them are the declining revenues & EBITDA.”

Yes, that.

It’s no wonder that investors are worried — revenue is expected to decline slightly to $1.03 billion, and adjusted earnings per share at 18 cents will represent a 51 percent decline from last year.

All that matters in this report is the status of Yahoo’s spinoff of its stake in China’s Alibaba Group and any potential for trouble over it with U.S. and Chinese regulators. If there are issues and possibly a tax bill, it will obviously not be good for Yahoo since Alibaba has been the company’s only bright spot.

In fact, stock market declines in China have already impacted Yahoo. With a more than 20 percent decline in Alibaba stock of late, Yahoo’s stock has done the same.

In order words, you live by the asset, you die by it.

This article originally appeared on Recode.net.

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