Yahoo's Q1: Revenue down 6% To $1.06B, Net Earnings Decrease 28%

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Search portal Yahoo has just released its 1st quarter 2011 earnings. Yahoo’s non-GAAP revenue for the first quarter of 2011 was $1.064 billion versus $1.13 billion reported for the first quarter of 2010. This represents a 6% year over year decrease.

Yahoo’s GAAP diluted revenue for the first quarter was $1.214 billion, a 24% decrease from last year. Operations income also increased 1% to $190 million in the first quarter of 2011.

Yahoo’s net earnings per diluted share for the first quarter of 2011 were $0.17 compared to $0.22 reported in the first quarter of 2010, also representing a drop of 23%. Yahoo’s total net earnings for Q1 2011 were $223 million, versus $310 million in Q1 2010 — A 28% drop.

Display revenue increased 10% but overall search revenue dipped about 19%. Yahoo blamed its revenue dips on the reconfiguration of revenue due to a search agreement with Microsoft. It also held that revenue was flat YOY once you deducted the revenue from the sales of Zimbra and Hot Jobs as well as certain fee rate reductions.

Yahoo has had a tumultuous quarter, experiencing layoffs twice and losing search income. Yahoo shares are up 3% after hours today as the company barely beat Wall Street market analysts’ modest expectations of earnings at $0.16 cents a share and net revenue of $1.05 billion.