♪ >> from our studios in new york city, this is "charlie rose." charlie: marissa mayer is here from yahoo!. she inherited a legendary, iconic company in internet history. people want the company to succeed and they want her to succeed. she does not do many interviews, but we are pleased to have her here to talk about the future and the past. as many know, yahoo! owns 40% of

the chinese company, alibaba. they sold 50% of that stake in 2012. yahoo! still owns a part of alibaba, said to be valued at $24 billion. there was an idea of a spin off, but the board decided a reverse of the spinoff, operating businesses by committees selected by the board. she has announced a plan to return the iconic company to greatness and that is what we will talk about. i am pleased to have her. welcome. marissa: thank you for having me. charlie: good to have you here. tell me how you see see yahoo! today and what you want to do to return this iconic company to greatness? what is the plan? marissa: yahoo! was the original internet icon and a huge part of people's daily lives, more than half of the viewers will view a yahoo! product sometime today. and it is an amazing opportunity to say, how can we take

something that was such a huge part of people's lives, even today, and transition as we see a shift in technology. with mobile, with video, wearables, so many great opportunities in terms of, how do we guide people? this is a guide to the world wide web, how can we be that guide? how can we be that modern version of that? we have come so far and i am proud of our progress, but there is still more to do. and we have tremendous assets, a large stake in yahoo! japan, we . we also have, as you mentioned, the alibaba stake, and so you know, there is quite a lot overall. there is the operating business, how do you provide the service to one billion users every month, mail, sports, finance, and how do we manage these large

assets that we have in china and japan? charlie: so the board has decided to do what? to have conversations about selling core assets? marissa: the alibaba asset has grown to be really large inside of yahoo!. and one thing we are looking at, how do we create the most value for a shareholder? one element of that is really around, how do we get alibaba into an entity by itself. by doing that, we unlock opportunities in terms of tax efficiency, greater valuations, etc. one thing we endeavor to do was a forward spin. the all about us take into its own country, we've decided to pause that, now we're looking at we can do a reverse spin, or an alternative with a business that could be a merger, ultimately, basically get both the operating

business of yahoo! and alibaba into separate entities. charlie: you are downsizing the core business by 42%? marissa: we have terrific traffic, advertising revenues, but when we look at where we want to put our energy, we really want to have fewer, fewer arrows for strategic pushes, with more people on them. we have tried to change the focus, from autos, to personal, to today, our focus is search, mail, and a tumbler. those are three platforms. in terms of the verticals, news, finance, lifestyle and sports. charlie: what will this do for you and how will you make it a success? marissa: we want to focus on our end users, how do we provide them with the best possible service?

the best possible news. also, the shareholders. we want to generate the most possible value for them and there is great opportunity in this asset stage to really unlock more value. charlie: there are big five companies, yahoo! used to be one of them, but is not in that ranking now, microsoft, amazon, facebook, and others. where does yahoo! fit? will you find a place in search? or looking at e-mail? marissa: search today, web search is what a lot of people think about. we are really proud of how far the search industry has come, but if you look at search on a mobile phone, it should be different than what it is today. it says a lot about you as a person. an example, if i type in jfk into web search, i am probably looking for john f. kennedy.

if i type it into my phone while i am going down the freeway and you know from my e-mail that i have a receipt to be on a flight later that day, chances are, i am trying to find out where jfk is, what gate the flight is leaving from, etc. so there are new forms emerging. this would be like a personal assistant, like siri, cortana. we really think that given our heritage of search, there is a lot we can do using preferences, even e-mail, obviously with their permission. to really rethink how search can work. today, our market share is around 10%, overall. i think when you look at the broader world of search, a majority of searches are done from about phones. the other thing we know, we have and analytical side, knowing

that 8% percent of time is spent on browsers, 92% of time is spent on applications and web search is confined to the browser. how can we really unlock the information data and capability of all of the different apps to help make phones more effective. charlie: that is a promise people have been talking about for a while. search moving to app do you think that will happen? marissa: i think that when you start to see something like the voices search, image recognition, a lot of these problems have been solved in recent years and when i look at the ecosystem, the fact we now have apps on our phone, they can help you get an uber, book a flight, if i know your preference and what services you like, i can help with a search assistant, which can help pull

that together and make life more seamless. charlie: when you came to yahoo!, there was high expectation about where you had come from and the role you played at google. do you think that expectation for you was too high? you had great ideas, you looked at yahoo! and you knew what the future was going to be in terms of mobile, you saw that coming. you look at the possibilities of mobile ads, and yet who had generated company because of ads. marissa: i think hopes were high because there is a perfect team at yahoo!, great people behind the products and you can feel it when you use the website. there are great personalities and opportunity and i think that people like to cheer for yahoo! and when --

charlie: was the expectation for you enormously high? marissa: the brand is very iconic and the team is very excellent. there is a strategy that made sense. mobile is yahoo!'s future. we have mail, search, news, sports, finance, those are all things that people like to do on their phone. so there is a great opportunity for us and we have made a lot of progress over the last few years, going basically from having no users, to having 600 $600 million on mobile. to having almost no revenue in terms of mobile advertising, and last year, we had $1.6 billion of advertising, and this is a business that we have grown in less than three years. charlie: why is there some as criticism of yahoo!? looking at what you have done since 2012, they said that they were a flurry of acquisitions, including tumbler, and most of them did not work. she spent $2 billion and most have not worked and have been written off. marissa: i would say that -- i think it really was a matter of, we needed to rebuild talent base.

we had 50 engineers in a company of 14,000, working on mobile. today we have more than 500 engineers working on mobile. we have one of the biggest app shops in the world could we had to build that and we did it to through talent acquisitions. we saw the benefits of those acquisitions in our mobile. yes, we did see a write down, but that is not because of acquisitions. charlie: and with tumbler? marissa: with tumbler, we have fallen a little behind. but i am still optimistic about tumbler. this is a great platform. the time spent in there is really high and overall it is a great opportunity to take things like advertising and mobile. tumbler is growing nicely in terms of daily active users. it is a really creative platform. charlie: look at the 3.5 years,

since july 2012, and here we are in march of 2016. when you look at what has happened, what did you do wrong? marissa: i think that, one, i do not think that the story has played out. when we look at this, we still have plans for the company and we should look at the turnaround. a turnaround takes about 5, 6, 7 years. charlie: it is rare when you are able to turn a tech company around, apple being one. marissa: i can see the strategic plan, we can see how it is working. there are 600 million mobile users. we are generating revenue. this is a feature that we built ourselves and when i came to yahoo!, and came in because i wanted to work hard and about it was a great challenge. i met with all the business leaders and reviewed things, every single one was in decline and nobody had any idea about

the turnaround. charlie: the ceos -- marissa: everything was in decline, i came and i thought, wow, this is a problem. i went to the board and said, we have a problem. we need to get these things growing again. nobody knew how to do it. yahoo! became the banner ad. banner ads are still very popular and effective, but mobile is where the action is. we had to build ourselves a new feature and we needed to build it to scale that matters for yahoo!. today, the mobile video and revenue is material over all to the company. we are really proud of that. we had taken it from a few million dollars to today, $1 billion and one of the fastest-growing businesses we have seen. i am very proud of what we did, but we needed to decide in the turnaround, how do we stabilize that declining revenue, because there was a lot of it.

$4 billion to $5 billion a year. and then be able to grow fast enough to offset that and actually show hypergrowth you expect, but -- charlie: 2.1 is the expectation level and the difficulty of the challenges you face, declining revenues. but you see yourself any situation in which you have stockholders, shareholders, making certain demands and the board deciding to say, yes, we will consider selling these assets and you on the other hand, you are trying to develop a plan to make these assets function, including illuminated businesses you are not in, that you have found unsuccessful. marissa: but they are completely complementary, at least for the shareholders, this -- separate the alibaba stake. we could spin it off. charlie: why didn't you do that? marissa: we didn't do that because --

charlie: why not? marissa: overall the market was -- now we are looking at a reverse spin and we are doing work on that. we are also looking at sales and corporate in fact, those two processes, looking at a different alternative in terms of the overall strategic outcomes for the core. this is the same as a reverse spin. you end up with a public entity at the end versus a privately held company. i think that either of those outcomes would be really good for yahoo!. i can see outcomes where we could become stronger terms are strategic execution. either because we get more mobile distribution, or ultimately, these could be done more privately. overall, i can see an outcome where we can achieve separation of the alibaba stake, which is critical for unlocking value. while we also get a boost to the core operating business for yahoo!. charlie: when you sold one half

of your stake in 2013, what happened to those revenues? marissa: the proceeds were returned to shareholders. today, we have over $200 billion, but we actually return $10 billion to shareholders. so, we have done a significant number of buybacks and returned a lot of the value to shareholders, which we think is appropriate. charlie: if there is a sale, you go with the company? marissa: the biggest piece for me, taking this iconic company to the right place. charlie: apart from the alibaba stake. marissa: yes, that question for me, the primary issue is yahoo!, technology, the services, the employees, how do we get that to the best possible place for yahoo! and find it the best possible future, and i am secondary to that. charlie: what would you like?

you put all this time and care of these assets and redesigning them, i would assume that you want to go or they are. marissa: i love running yahoo! and i think that the people are terrific, i love the products that we get to work on, this is really exciting and i would love to see it through. but obviously, we have our duties to find the most value, so i hope that the strategic alternative has a place for me. we will obviously honor our commitments to our shareholders. ♪

♪ charlie: there was a story about one of the other firms, it could be true for you, talent flight. in circumstances like this, you had to increase the premium you pay for key employees at a time like this, true? marissa: i think that that is true. one thing that people need -- nobody does their best work when they are afraid. you need to remove uncertainty and what we have done is make sure that people understand they are part of our future. certainly right now, talent is a hot issue at every company in silicon valley. especially for us, and we have had to take steps in terms of compensation to make sure that people understand how we value their efforts.

charlie: how difficult was it for you since 2012, to get a firm position on mobile ads, because predecessors had not left you in a firm position? you had to play catch-up. marissa: when i came, my thesis was on mobile. how do you take all of those great services over to mobile. when i got to yahoo!, i spent the first two weeks hanging out in the cafeteria my talking to anybody who would talk to me. i finally ran into a mobile engineer, his name was tony. and i asked, what are you doing? and i asked how big is the mobile team? and he said 30 people. i was really taken aback that it was only 30 people. and he said, don't worry, there are more of us. and i said, how many? he said, maybe twice that. and i said, maybe 60. and i said, guys, how many engineers do we have that work on mobile? and they said 100.

and we needed to build competencies there really quickly and we really needed to come it was obvious at the time, but there was a lot of discussion around native applications, which forms mattered, and without a native apps where the right thing to do. we were working on different apps at that time. we decided that ios and android were the two platforms that would become dominant and we were right on that bet. at the time, it was not obvious at all. and there is a terrific leader and manager in the company, his

name is adam, who became the senior vice president of mobile and he has done a great job of recruiting engineers, recruiting people into a place where they can do terrific work. we won a design award for two years in a row. one for weather and one for news digest. we came a long way, especially where we came from. there is still more to do. we love to have even more engagement on mobile and we are working on this. charlie: what about decline? marissa: we started very low. charlie: and the dominance of these five huge companies? marissa: 600 million mobile users puts us in the top five audiences globally. and mobile advertising business, that is more than $1 billion, that is as easily into the top mobile advertising companies in the world. part of the issue is that we were so big to begin with. there are only three u.s. based companies that have more the one billion users every month. there are only three u.s.

based companies that have had more than $4 billion in digital advertising a year, google and facebook. we came from a very large place. and that makes it really hard to generate growth. 10 million new users. $10 million of additional revenue on $4 billion. charlie: the number of users you have had for a long time? marissa: well, we have been growing users and it continues to grow. it is actually higher than one billion. charlie: why do you think that people come to yahoo!? marissa: our businesses is around informing, entertaining, and connecting users and for me

that search, mail, and digital content. it really is a digital network, because the three really work together. there are some people who come for mail and to the state and to do a search or read a news article. some people come for sports, and they might read e-mails. search is really around helping people do discovery and in terms of the business, it really is a lucrative form of digital advertising. mail, there is less frequency, they are checking the mail dozens of times a day and for us, the news is our voice. it allows us to personalize, it allows us to differentiate -- charlie: he was done magazines. the number of people you brought in to provide a kind of news base for the company. and they also raised the question, fundamental credit they say, look at the core assets and if you take the alibaba stake outside of it, the value is very small. marissa: i do not think their value is small, the way the market is valuing them today is small. charlie: it is almost minimum. marissa: we think that they are very undervalued. charlie: but the market says that those core businesses are not worth much. marissa: this is part of why we

are considering strategic alternatives, because we think there is more value their that can be realized. considering alternatives is one way to unlock the value. charlie: do you think that you will be running yahoo! a year from now? i ask that because people ask that. marissa: again, i would love to be running yahoo!, we have a three-year strategic plan and i want to see how it could work get a successful turnaround. but it is about the users and about employees, and what is happening with all of them. i certainly hope that our services are here a year from now and that they run even better than they do today. that should easily be the outcome. and we have a terrific team at yahoo! and a really help that i really hope that they are allowed to continue to do the work. we are going to look at all

possible strategic alternatives and i am positive we will find the right one. charlie: i am told that you have reached out to lots of people to ask for, look at the position we are in, what is the best way to go. you are speaking advice from a cross-section of people, to say, this is the challenge we have and this is my plan, what do you think? marissa: yes, we have gotten a lot of advice, both formally and informally. our situation is complicated, so it'll take a complicated solution. charlie: explain what you mean by complicated. marissa: when you look at our business that the search, the mail, the content, when you also look at the stake in alibaba, the joint venture with yahoo! japan, a joint venture in australia, and we have yahoo! seven, when you look all the

of it it is a complicated space. , when you look at how we can maximize the value that is recognized by all the different pieces, it is complicated. charlie: in order to get a spin off of the alibi the assets, who alibaba assets, who would have to sign on to do that? marissa: the price we bought the state for was relatively low. but it has gone on to really multiply, it has a tremendous return. so, given that there is a large liability on that stake, there are various ways to address it, obviously it is tied closely to the value of alibaba over all. it is a publicly traded company. but basically, the thought is, there is more tax liability introduced by a spinning out of alibaba, then there is with a reverse spin and the company that we built to operate yahoo! is a smaller tax liability. charlie: do you feel pressure from stockholder activists?

marissa: we certainly see their criticisms and challenges. and my view is, i think that having a lot of different viewpoints on the issue is helpful. we really take that seriously, we engage with them, we engage with all shareholders and we integrate that to the best of our ability to ultimately find the right path forward. charlie: if you look back in the last 3.5-4 years, was there a big bet that you wish you had made that you wish you did not make? marissa: we have made some really big bets. we have tried to populate the talent. charlie: this was an acquisition? marissa: they now work on mobile, these are the people that build mobile -- all of those different mobile applications. to me, we have taken what was a really scattered framework of mobile applications, i think at had 81 applications, and now

we have about seven or eight that are really strong. i think the big bet on tumbler to me, while it may not be yet material, it is a terrific asset, terrific network, the team working there is exceptional. and we have a great path forward in terms of what we can do, how we can help to continue to grow that community of creators, while providing a great opportunity for brands and advertisers. charlie: then why was it necessary to reduce, to write down some of the value of that? marissa: there are a whole set of accounting rules, part of it is that the composition of our market cap is in fact, complicated. when you're trying to find a market cap of our operating systems, it becomes attractive. there is only so much left. and if your book value exceeds the market value, you need to write down.

charlie: yahoo! is a company that everybody has affection for and want to see succeed, as they do for you, because you have been a part of the silicon valley for a while. what have you learned, not about specific things, but any sense of coming into a certain likeness? what do you wish you had known? what has been a learning experience? marissa: again, what is great, i get to learn every day. and i think that, it has been amazing. i love design and getting to work with the team at yahoo! to design the future, how the think that pacing and time is always important. i think that there are some things that we did too quickly and some things we probably did and too slowly. charlie: and not enough. in marissa: and not enough. but i think that we learn from

that and we are constantly getting better. and when i look at the strategic plan we rolled out, this is the combination of all of that learning credit one thing we should do is get away from declining revenue more quickly you and get more focused on areas of revenue and of the business that can grow really area and substantially to get us returns. and really, that is another key part, that yahoo!, there are some many things we work on, it is really important for us to be focused. in a focused on providing the best possible service to users, focused on the product line, where we can do really excellent in each area. and really differentiated. i am feeling good about the andi am feeling good about the strategic plan and how we can achieve that in all the areas. charlie: it had to do with real andcharlie: it had to do with real estate, offices, but it also had to do with people.

people you had brought in, hoping that they could create you something that would be a and you something that would be a vital part of -- of all those, what was the hardest loss for you? you? i didn't know it and i for the yahoo! community? marissa: i think along the way, there were all kinds of different things we tried. i am proud of those experiences. we tried to set up a community, digital magazines, i would say when you look at the successes we have had, and with native advertising, yahoo! gemini is one of the fastest forms of advertising growing on the web. wine overall, this -- i am proud and of that. i would say that some things we learned around digital magazines and the original content, they just live on in a different form. because some of those types of media when they translate online, you need a lot more support in terms of the tools offered. why is yahoo! finance more

in successful than the magazine, because you have fully owes -- portfolio. where we successful in sports, because you can follow teams, put together your fantasy football lineup. so, i think that having told is -- tools is another key in succeeding. charlie: someone you know would in say, what did you think of nfl's streaming? marissa: we were the first load -- global live stream of the nfl in october, the buffalo bills and the jacksonville jaguars. it started at about 4:30 a.m. i pulled into the parking lot and it was amazing, because there were literally 300 cars at 4:30 a.m. i took a picture of it. it was a great moment for the company. our goal was -- was to try and in build a record number of viewers, we saw 33 million views on that stream. an on that stream. all on a sunday morning, which tends to be a sleepy time on the internet. and we did it was unbelievably high death quality -- def quality, very little re-buffering, compared to and re-buffering, compared to standards and other streaming

providers. you and providers. i think that we made a case for ourselves in terms of how we a work with quality. and obviously, because of our heritage in sports, this fit in with fantasy football and it was a really proud moment for the company to get to partner with the nfl. charlie: then your time said -- new york times said in december, it is a collection of news, entertainment, and communications, destinations supported by ads. it was hard to build something novel, but it appears like they are building a better yahoo!. in are building a better yahoo!. what is a different company that an interview marissa mayer could have built? one option, diving into television. she could have bought netflix. was that a possibility for you, and did you think about that? because when terry was there, the idea of yahoo! as a powerhouse was given emphasis. marissa: yes, i think that

overall, there are opportunities. that the same time, we have a i huge user base. will huge user base. you and we cannot stop running e-mails, searches, providing the e-mails, searches, providing the you and i and more news, so -- and we have $4 billion worth of advertising revenue and advertising messages that we needed to get out on behalf of advertisers. so, i do not think there was a world where we could have done a pivot and walked away from things. there are maybe some things we could have added, but that goes back to the point of focus and distraction and saying, we really want to go back -- i found i really wanted to find the core of yahoo! and figure out how to use them. and charlie: and build on them. you said what you had done in a new plan is a bold action. that sum would look at what has taken place and to say this is not a bold action, she is simply

doing this -- a comb this said that comments -- a columnist said, she is just changing yahoo!. they said that the assets could be valued much better than they are today. name and are today. did you consider that at the time, was that a choice that was your company is decided not to you and your name decided not to and make? you and marissa: we decided to buy tumbler. you and i are buy tumbler. that was a big bold move. so we made it big bets. some of them have paid off. i really feel like we don't want to turn our backs on the users we already have. and we have had a lot of opportunity. in your home and opportunity. now on mobile, people are doing something that is completely you and i will something that is completely and will you different than what they had and done on desktop. yes, the tolls -- tools are a little different, but it is

still about communication, information, how you entertain yourself and all the things we provided on desktop, they still on provided on desktop, they still have a lot of value and and they are still the most frequent things people do on in frequent things people do on and in their phones. and in i did not feel like we and needed to necessarily change who we work and move into a new area, i felt like optimizing what we had and really making a in more suitable for mobile, because we all knew how big and mobile could be. it was really probably the it was really probably the him and in better path for us. i felt like we should continue to make big bets in the areas we were already strong in. charlie: how long do you think you have to make this plan work? marissa: this is a multiyear

plan, obviously with the reverse spin or the alternative, that will come to conclusion far your way will come to conclusion far and he before that. i hope that we are able to see that plan through, because i do think we can see how it will work and how it will affect the turnaround. again charlie: you are back in not on the committee being that is looking at new in the that is looking at new acquisitions, is there reason for that? marissa: this is the way it is typically done, for myself and david philo, the founder of yahoo!, we are considered not independent core numbers, we are employees and we are part of the operating system. charlie: you are employees. marissa: yes, there is a committee already formed, but we

are working with them each day. charlie: let me go back to -- think out loud about how beyond building the plan, what you hope and believe yahoo! can become. marissa: i think it can become a vital piece of everybody's day on the phone. and i really think that we can add a lot of value, whimsy, and a lot of utility two things and people do every day and and you and you people do every day and trying to make lives easier and help them -- somebody wants said, i turned to yahoo! for everything i need to know. and a few things i didn't know i wanted to know. there is an element of serendipity in it and i think that obviously, there is so many and that obviously, there is so many how you things you can do, and you but i really hope we can

continue immobile to be that continue immobile to be that and you and guide we have always been. to guide people to information they need and a few you and they need and a few serendipitous pieces of information or things to do that maybe they would not have thought of. charlie: is your biggest challenge right now, you do not you and challenge right now, you do not do many interviews, to condense not only your employees, who i assume are with you, but to convince the you and community and the people, that this is a plan that you people, that this is a plan that will work and will work and will have the power of reducing, of changing the attitude that the investment committee has and the investment committee has about these assets? you marissa: i think when the business really start to grow, that type of change in the investment community will happen. are you. happen. the biggest challenge we see is around mobile engagement. we have 600 million users, how

and do we get them to monthly you are you users and coming every day? and you and you and every day? how do we build products they need to have every day, so we are looking at that, how we you invest in medications, that is the biggest driver, frequency of use. how many times you check e-mail on your phone or text, or message, so this is a great opportunity around communications. also, how do we make the applications of the best and you will applications for news, for search, for sports, for finance and lifestyle. we are working hard on those areas because we think that by creating great tools that can be used on the phone and putting them together in a right way, you can ultimately really build the user base that comes more frequently and find more utility and value in applications. we are already highly valued, but we want to increase frequency. charlie: and with the investment community. when you look at the companies you compete with today, users and the success of facebook in respect to yahoo! and

advertising on mobile, do you see that leveling off? marissa: i think that mobile will continue to grow, mobile advertising will continue to grow. because i think, one of the things you see, search continues and you and things you see, search continues to be lucrative. charlie: but you -- marissa: there are so many new you andmarissa: there are so many new formats of advertising, there is native advertising, click to install ads, where people are quickly trying to get those installed on phones. so many different models, these are the early days in my view of mobile advertising, what is the you best way to put that message out and for the advertisers, what is the right parts -- right product? how do you format that product and how do you make sure that messages are received most effectively. charlie: it is clear to see and where the cloud, the impact it would have when you took it would have when you took you will need over. in 2016, what is clear in terms of your vision of the future? marissa: one of the interesting things we have seen is video.

i think that now and when you look at what is happening with mobile video, this is actually a cross product, so we will be think about video antisocial, but video watching on phones is at an unbelievable level. last year, it was found that more people watch -- there is more video watch on mobile devices than on desktops. which is already in garbled. charlie: people watching wherever they are? marissa: i watched a television show last night at the gym. will show last night at the gym. between phones, tablet, people are watching an incredible amount of video on those. we are excited to participate with that. nfl nicely ties together the video element, one of the and video element, one of the biggest things we needed to do for streaming that game was make sure it worked on every will platform, ios, all the different formats. i think that mobile video will you and ♪ you and ♪

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charlie: at the end of the day, what you are saying is the biggest asset that yahoo! as this -- is, is the users? marissa: the audience that comes to yahoo!, the following of the brand, the fact people, every day, this is a huge amount. a huge number of people who really rely on us and a huge amount of traffic that ultimately gets distributed to the yahoo! you don't -- yahoo! homepage and through the mail service. the ability to direct that traffic and attention to the stories that matter, the key information, that is a huge opportunity.

charlie: you have had a successful career at google, a wonderful family and you have had all of the money you need for the rest of your life and other lives, but somehow, because this has been such a challenge, with expectations you had maybe not the filled early on -- fulfilled early on, your own determination to do this has magnified today because of the challenges that have presented themselves. marissa: absolutely. i feel like now, i can see it, i can see how yahoo! can win and how we can get there and it makes me even more determined. charlie: why do you think other people have not seen it as clearly as you have? they are questioning yahoo! at

this moment? marissa: i get a print row seat. our situation is, could. -- is complicated. there is a lot of work left to do, but i can see how much progress we have made. charlie: will i have others not seen it? marissa: i can see us in the future. there is a big dichotomy at yahoo!, are you looking at the operating business, are you looking at the asian assets, which are tens of billions of dollars. how do you balance those? i definitely see in our shareholder base, we have people who own yahoo! because of the core business, those who own yahoo! because of the assets and how they are valued. charlie: how would you break that down in terms of people who see yahoo! and see that it is asian investments, versus those who see the core business? marissa: so yes, certainly the value is evaluated on asian assets. maybe you own the stocks because of the future. where do you really think is going to be the biggest catalyst? charlie: you firmly believe that the value of the core asset can

be -- marissa: i think it could be higher than today. charlie: of course. having believed that, you believe the value of assets can match the value of the assets of the japanese investment? marissa: i think that, overall, i think we would need it to achieve growth. growing revenue, we know that, because of declining legacy revenue, we have been weighted down in that. but now that we are moving away from some of the legacy revenue, which is largely from premium banner ads, now we are moving toward global and video and we can see a path that will have growth in it. and is valued more by the market. charlie: with the growth be easier if you had inherited a better situation and you come our focus on it at the beginning? marissa: i think that overall, we have focused the proper amount. you need to make an immediate decision when you come, you try to build the revenue back up, but that was impossible for us. you try to offset the declining revenue, or do you take that out? i would argue that our revenue base were large enough, the services were large enough, that we cannot walk away. we needed to stabilize the core business while we added new businesses. and we needed to get those growing really fast and get them to a skill that matters on a $5

billion base of revenue. and we have come so far in that. our mobile video, the revenue being about a third of the total revenue, essentially from zero. so you know, the issue is, our legacy businesses have been declining quickly, despite our best stabilization. if we do not try to stabilize them, it could have been worse. we have been moving about a half $1 billion a year, in terms of legacy revenue. a lot of people said -- i have talked about this like tectonic plate shifting, because if you look at revenue, it has been flat and a stable, but the composition of the revenue is different. you have huge amount of legacy revenue falling away and new revenue coming in in terms of mobile, in particular. charlie: i hear you saying at the end of the day, you talk about plans, how it is going to work, but i hear you say that in terms of your tenure there as ceo, i have done what i had to do because of the legacy business, and needed to stabilize them.

it is not like i'm either on decisions, i made -- the wrong decisions, and had to make the decisions because of the company state it was in. marissa: i think a lot of this comes down to timing and expectations. certainly, the path of success is never linear. i do think that overall, we have done what we needed to do. we have done really well and some things better than we could do. if you look at the mobile growth, that is way faster than i expected. absolutely. things have gotten better. but we are still at that point, and transformation, we have not made turned -- we have not made or turned yahoo! around and got not revenue form -- from it. we have gotten an increase in users and revenue does follow users, but coming from those large revenue assets, they were a benefit because they were so

large, but they are -- it is hard to get that growth quickly. charlie: are you confident that the shareholders will give you the amount of time to make these assets grow?

marissa: a lot of this has to do with, how do we find this for the shareholders? the reverse spin, the other alternatives, those are important overall for the company and being able to find the strategic moves that would come from either of those and the value that could come from those, is something that can be beneficial. i will make the sacrifice. i will often say, you cannot have everything you want, but you can have the things that matter. i can have my family, yahoo!, and do a good job at both. admittedly, there may not be time for anything else, but this is how i have approached it. there are some women who want to work, some women who do not want to work. those are both valuable choices. you need to make the choice that will work for you and your family and situation and circumstance.

charlie: he made the choices that were right for me. marissa: yes. everybody at yahoo! took at least a month off, in fact, most took four months off that we offer as part of our maternity leave policy. and many asked, was i setting a bad example, by taking a short leave? i needed to take a short leave. i may have cut off time with my daughter and son, by encouraging people to take their time off. charlie: did they say that you are crazy? marissa: probably. again, everybody does it in their own way. i came back to work really

quickly, but i also made a lot of time to spend with my children, you know, in the same context of being back at work. so, you can have a lot of time with the children, while you also find down time, nap times, different moments in the day. yes. charlie: finally, there is a question in silicon valley, you have often cited as one of the most prominent examples, among others out there, including at companies like google -- is it going to get better? marissa: i think it will get better. technology, especially the internet, and computer science, they are really new. charlie: that is what they loved about you, look, she is it an engineer -- she ends and -- she is an engineer. marissa: yes. charlie: do you still code? marissa: on various side projects. but over all, i think that we need to make, i think we need to make technology and computer science really tangible. it shows that the issues, in terms of having enough women in technology, they need to start early, middle school, high school.

i think as technology becomes more accessible, people are asking, how can i work on that, how can i do that? i am hopeful that that will drive more women into computer science. charlie: a long way to go. finally, i do not talk much about this, but encryption. or you supportive of that -- are you supportive of apple? marissa: we are to we do not have -- we are. we do not support terrorism, but with apple's stands revolves around the fact that what they are being asked to do, it could be abused. there is a very gray area in terms of, if that technology, if a backdoor exists, how will it be used and how will we government -- govern it? charlie: and encryption has gotten better. marissa: yes, and the stance is really on point and it is something that we would support for our users.

charlie: it is good to have you. marissa: thank you. ♪

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