Yahoo cancels earnings call as Verizon calls for a discount

October 17, 2016 | 12:00

Tags: #back-door #backdoor #breach #financial #insecurity #privacy #security

Companies: #government #verizon #yahoo

Following a disastrous data breach and claims that it had installed a back door into its email client for the US government, Yahoo has cancelled its earnings call.

Traditionally taking place immediately after a company publishes its quarterly and yearly financial reports, the earnings call is an opportunity for investors and press to ask questions and put the numbers in context. For most companies, even those publishing bad news, it's welcomed as an opportunity to spin the figures into a positive light and redirect attention onto more favourable areas. For Yahoo, though, it appears to be a minefield it's looking to avoid: tomorrow's financial report will not be followed by an earnings call, the company has confirmed.

Officially, the call's cancellation is the result of 'the pending transaction with Verizon,' in which the latter is discussing a deal to acquire Yahoo. Unofficially, however, it may have more to do with awkward questions the company would rather avoid: questions surrounding the recent data breach that saw personal information on around 500 million users stolen, or the claim earlier this month that Yahoo had inserted a wholly insecure back door into its email system to scan for US government-provided keywords - and without the knowledge of its chief information security officer.

For Verizon, the recent bad press appears to be souring its planned deal to acquire Yahoo. Although Verizon itself has been keeping silent sources speaking to the New York Post have suggested that the company could be asking for a $1 billion discount on the deal, more than a fifth of the originally-agreed $4.8 billion purchase price - and it's hard to see Verizon taking Yahoo's lack of confidence as indicated by the cancellation of the earnings call in a good light.
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