• D: All Things Digital, Monday, July 7, 2008 12 PM

Over the last several weeks, all the Yahoo focus has been squarely on the company's flagging stock price and the looming proxy battle with billionaire corporate raider Carl Icahn. However, prior to the fateful Aug. 1 shareholder meeting, Kara Swisher says there's a bigger story on the horizon: Yahoo's second quarter earnings report on July 22, which will say much about the future of several top Yahoo execs, including CEO Jerry Yang and President Sue Decker.

Swisher thinks it's "highly unlikely" the quarter will be a disaster, but more importantly, she says, the company simply cannot afford bad results given the turmoil surrounding it on all sides. In fact, to guard against that possibility, execs are turning to "well-known tricks of the trade," like short-term display deals at lower CPMs, and adding more sponsored links to search pages. Even Google resorts to such desperate tactics, in desperate times, she says.

For example, Swisher conducts a side-by-side comparison of Google and Yahoo for several terms, and finds that Yahoo had two to three more sponsored links per page than Google. Sources said the Web giant should deliver in the "mid to lower range of Wall Street expectations" for its second quarter earnings.

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