Yahoo Expects Operating Margins to Rise

Yahoo Inc., the No. 1 Internet directory, said it expects its operating margin to be 30% to 36% in 12 months, as it continues to boost its revenue and earnings. The company’s target at the time of its initial public offering for operating margin, which is operating profit as a percentage of revenue, was 16% to 26% by late 1998. The company had an operating margin of 22% in the second quarter. The company expects that figure to rise in a year. Analyst Mary Meeker of Morgan Stanley Dean Witter said the company expects to reach its new operating margin range by the third or fourth quarter of 1999. Shares of Santa Clara-based Yahoo fell $3.31 to close at $90.06 on Nasdaq.