[R]10:00AM New York – Yahoo stock fell 10% in the early morning trading after it reported lower than expected rise in sales and earnings.[/R]

Yahoo fell in the early morning trading after weak financial revenue and earnings projection. Yahoo continues to face challenges from Google and from decline in revenues in the international markets.

Yahoo (YHOO: chart) Revenues were $1,832 million for the fourth quarter of 2007, an 8% increase compared to $1,702 million for the same period of 2006. Revenues excluding traffic acquisition costs were $1,403 million for the fourth quarter of 2007, a 14% increase compared to $1,228 million for the same period of 2006.

Net income for the fourth quarter of 2007 was $206 million or $0.15 per diluted share compared to $269 million or $0.19 per diluted share for the same period of 2006.

Gross profit for the fourth quarter of 2007 was $1,130 million, a 12% increase compared to $1,012 million for the same period of 2006. Operating income for the fourth quarter of 2007 was $191 million, a 38% decrease compared to $308 million for the same period of 2006.

Operating income before depreciation, amortization, and stock-based compensation expense for the fourth quarter of 2007 was $527 million, a 2% decrease compared to $540 million for the same period of 2006.

United States segment revenues for the fourth quarter of 2007 were $1,313 million, a 15 percent increase compared to $1,145 million for the same period of 2006. International segment revenues for the fourth quarter of 2007 were $519 million, a 7 percent decrease compared to $558 million for the same period of 2006.

For the full year revenues were $6,969 million for 2007, an 8% increase compared to $6,426 million for 2006. Marketing services revenues were $6,088 million for 2007, an 8% increase compared to $5,627 million for 2006.

Net income for 2007 was $660 million or $0.47 per diluted share compared to $751 million or $0.52 per diluted share for 2006.