Yahoo aims to boost margins

By Harry Suhartono and Kevin Lim

SINGAPORE (Reuters) - Yahoo Inc wants to triple its operating margin to 15-20 percent over the next three years by increasing revenue and keeping costs under control, CEO Carol Bartz said on Tuesday.

She also said that Yahoo, the top U.S. seller of online display ads, planned to expand its business in India and hire more people there as it targets emerging markets with low Internet penetration and high growth potential.

"Six percent operating margin is terrible, terrible... We have a commitment that it will be 15-20 percent in the next three years," she said at a lunch talk organized by the American Chamber of Commerce in Singapore.

Bartz, who joined Yahoo as CEO in January this year, has been trying to revitalize the Internet giant by shedding staff, dropping unprofitable products and getting the firm to respond faster to changes in the way people use the web.

"We go where the population is, we go where the economies are growing," she said, highlighting India, Indonesia and Vietnam as countries where Yahoo hoped to grow its presence.

She would be heading from Singapore to India, she said, where she is scheduled to meet Indian Prime Minister Manmohan Singh and other senior officials. Yahoo plans to hire more people and find new partners in the world's second-most populous nation for its various Internet initiatives.

Turning to China, Bartz said Yahoo was "very happy" with its 40 percent investment in China's Alibaba Group although it recently sold shares in Alibaba.com, the Chinese firm's listed unit.

Yahoo does not have a direct presence in China as it has an agreement to let Alibaba use the Yahoo brand name in the country.

Microsoft and Yahoo earlier this year signed a 10-year global web search partnership to challenge market leader Google Inc, a pact that U.S. and European antitrust regulators are evaluating.

Bartz said the two partners will formally seek regulatory approval for their tie-up in the first quarter of next year as scheduled.

(Editing by Lincoln Feast)

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