In the fiscal year 2015, Yahoo! wrote down $ 4.5 billion in goodwill, which included $230 million for Tumblr. The company had acquired Tumblr for $1.1 billion in 2013 and accounted $730 million towards goodwill. After the partial write off in 2015, Yahoo’s FY 2015 annual report states that the company may consider writing off the entire amount of goodwill of Tumblr on its Balance Sheet. While Yahoo named Tumblr as it one of its three major products going forward, the segment could not meet its $100 million revenue target for 2015. We believe writing off Tumblr’s goodwill is a signal that Yahoo is cleaning up its financials for an impending sale and indicates that Tumblr fell short of its revenue targets, after Yahoo acquired it at a very high valuation. (Read Will Yahoo Successfully Integrate Tumblr To Pay For Its Pricey Acquisition?)

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