Yahoo Inc., based in Sunnyvale, Calif., earned $348 million, or 33 cents per share, a 28 percent increase from $272 million, or 23 cents per share, a year earlier.
Excluding certain one-time items, Yahoo earned 46 cents per share. That figured topped the average estimate of 39 cents per share among analysts surveyed by FactSet.
Revenue fell 6 percent to $1.27 billion. After subtracting commissions paid to Yahoo's ad partners, revenue totaled $1.2 billion, in line with analysts' projections.
Yahoo's 24 percent stake in Alibaba has been particularly valuable because the Chinese company is still growing rapidly as it prepares for an initial public offering of stock. Numbers released Tuesday by Yahoo revealed that Alibaba's revenue surged 51 percent in the third quarter. There is a one-quarter lag between when Alibaba closes its quarter and Yahoo collects its share of Alibaba's earnings.
Alibaba's allure is the main reason Yahoo's stock has more than doubled since Mayer became CEO.
Some of those gains evaporated Tuesday as Yahoo's shares slipped $1.12, or nearly 3 percent, to $37.10 in extended trading after the fourth-quarter numbers came out.
Mayer appears to be getting frustrated, too. Earlier this month, she dismissed Chief Operating Officer Henrique de Castro, who was in charge of the company's advertising. Mayer had enticed him away from Google in late 2012 with a pay package valued at $58 million at the time.
"Ultimately, Henrique was not a fit," Mayer said Tuesday during an online video review of the company's fourth-quarter performance. She added she doesn't plan to replace de Castro in order that she can become more deeply involved Yahoo's ad sales.
