Yahoo! expects £723m Tumblr acquisition to deliver revenue boost by 2014

By John Glenday | Reporter

May 21, 2013 | 1 min read

Just days after splurging £723m on Tumblr Yahoo! has confidently predicted that the blogging platform will send its revenues in the opposite direction as early as 2014.

Ken Goldman, Yahoo!’s chief operating officer, made the prediction during a conference call with analysts but refused to elucidate upon his thinking with hard and fast figures.

Analysts were more sceptical however; pointing out that the $1.1bn stumped up for Tumblr was far higher than the $800m valuation most recently attributed to the firm – and its 2012 revenues were just £13m.

The deal will see Tumblr continue to operate as an independent entity with David Karp, its founder, continuing to head up the division, indicating that Tumblr’s philosophy of eschewing advertising may continue.

This continuity is a conscious effort by Yahoo!’s chief executive to avoid ‘screwing up’ her new prize asset.

Reaction to the acquisition by marketing professionals such as Robin Grant, global managing director of We Are Social and Craig Le Grice, global technology performance director at Aegis Media, can be found here.

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