Apr 22, 2013 · 6 minutes

Every week, a little more incremental evidence emerges that Yahoo is pushing to turn itself around. In the past week, Yahoo reported a profit that was significantly higher than analysts had been expecting and released new apps that showed it's serious about being a player on the mobile Web.

And on Friday, Marissa Mayer finally addressed the brouhaha over Yahoo's telecommuting policy, noting that ending the work-from-home policy affected only 200 of Yahoo's 12,000 employees. She seemed perplexed that a policy intended to address a single company at one point in its history had been blown up into a debate over telecommuting – a false debate, since no one credibly argues that flexible work hours won't remain commonplace in the tech industry.

Mayer's silence on the subject until now is consistent with a characteristic of CEOs who successfully turn around companies: the ability to hew to unpopular decisions even if they generate broad criticism and bad press. Knowing when to explain yourself is a tricky lesson, one that many CEOs stumble over. So while Mayer's comments may not have been terribly meaningful in themselves, they add to the evidence that she is making a lot of necessary moves at Yahoo.

Early on in her tenure, Mayer sold off half of Yahoo's stake in Alibaba and gave most of the proceeds to shareholders. While that move limited Yahoo's ability to make strategic acquisitions, it's had the short-term benefit of lifting the stock 48 percent since then, increasing the paper value of stock held by Yahoo employees and making its future appear more attractive to potential hires.

Yahoo's focus on improving its mobile offerings is beginning to bear fruit. The company pushed out its revamped flagship Yahoo app today with seemingly endless scrolling of news stories and algorithms from its high-profile purchase of Summly. Mayer deserves points integrating Summly's technology in its new app less than a month after the purchase, yet the app doesn't feel fully baked: Many Summly summaries read as random edits and some video clips I played didn't have any audio.

Much more polished was the new weather app Yahoo unvieled last Thursday. Yahoo's data is used in the spartan weather app Apple installs in all iPhones (as evidenced by the Yahoo nano-logo in the lower left-hand corner). Yahoo cleverly drew on Flickr to improve the look of the app, while presenting other data like sunrise and sunset times in original, intuitive design.

With its weather app, Yahoo seems to be waking up to one of the biggest opportunities in the mobile Web: improving on the aging design of Apple's native, undeletable apps. Google Maps on iOS is the classic example, but other apps like Fantastical for calendars, Clear for checklists and KitCam for cameras have found niches by innovating where Apple is sleeping. Now Yahoo offers what may be the best-designed weather app for iPhones.

At the same time, Yahoo proclaimed it has “sharpened its focus” - which is apparently purplespeak for shuttering several sites and features that weren't popular enough to maintain. Along with Yahoo Mail Classic, which is still more intuitive and less frustrating to use than the current version, Yahoo Deals and Yahoo Kids will be dragged to the delete file.

While Mayer is making a lot of the right moves, it's not clear they will have the right results because the problems inside Yahoo have been a decade in the making. Smart moves that might quickly take root at another company may well end up dormant in the arid soil of Yahoo's long-dysfunctional culture.

For example, many of the actions Yahoo is taking under Mayer are reminiscent of ones Larry Page made when he became CEO of Google: making, and holding to, unpopular decisions (Google: Search Plus Your World, Yahoo: work minus your home); redesigning sites or apps to appeal to more users; and axing older businesses in the name of focusing corporate resources. That's not surprising, since both CEOs came up through Google's culture.

The difference, however, is that when it comes to eliminating old businesses, Google seems dedicated to preserving the Web's past while Yahoo comes across as hell bent on deleting it. Andy Baio, the founder of events community Upcoming.org, lamented the loss of ten years of the site's history. Yahoo controversially tried to close del.icio.us and deleted all GeoCities sites. Yahoo's GeoCitification of the Web may make for a more focused business, but it also turns the Web itself into an ephemeral historical document.

I suspect Yahoo's turnaround will show similarly mixed results in coming quarters. We're already seeing something along those lines this week. Yes, Yahoo's earnings of 38 cents a share “crushed” estimates of 25 cents. But revenue was slightly below analyst forecasts, and guidance for revenue in the current quarter is also below what Wall Street has been expecting.

Then there's Alibaba, which Yahoo still holds a 24-percent stake in. As one analyst said to the AP, Yahoo had strong earnings because it's doing better as an investment house than as a Web business. Yahoo can point to its rallying stock, but the rally is largely due to a shrewd investment made back in 2005. The financial performance of the core company is still muddling along.

Yahoo's revenue last quarter fell 7 percent from the same quarter a year ago. Paid clicks on search ads rose by 16 percent, which was below the 20-percent figure Google reported. In display ads, the number of ads sold and the price per ad both fell, resulting in an 11-percent decline in display revenue to $402 million. Yahoo remains a company dependent on online ads that is losing ad revenue to Mayer's alma mater, among others.

Yahoo faces a choice with its remaining stake in Alibaba. It can hold onto it, allowing the Chinese e-commerce phenomenon to buoy its EPS in future quarters. Or it can sell more of the stake, returning cash to shareholders in dividends and buybacks. Both will keep Yahoo's share price aloft. Neither will turn around Yahoo's underlying business.

Alibaba is Yahoo's lifeline into an overseas market enjoying a burgeoning online population as well as an expanding middle class. In that sense, Alibaba is something else for Yahoo: A mirror that reflects back its youthful face 15 years ago. Wall Street cares less about what Yahoo can do with a weather app than what it will do with its Alibaba stake. Merrill Lynch raised its rating on Yahoo to buy from neutral, but it also added, “Alibaba’s potential valuation is fundamental to Yahoo's stock price.”

Mayer has been at the helm of Yahoo for less than a year, and most turnarounds require several years to complete. She deserves much more time. But one thing is becoming clear: Yahoo is nowhere near becoming a company that will influence the Web the way Google or Facebook will. It's still playing catch-up in a market that is plunging recklessly into the future.

In fact, Yahoo still looks a lot like the company it was back in 2005 or 2006, when it was investing in startups like Flickr, del.icio.us and Upcoming.org. And most importantly, Alibaba.

Mayer is making a lot of the right moves to turn Yahoo around. But I still wonder whether it will be enough. The company can afford to buy more time thanks to its stake in Alibaba. But the problems facing Yahoo are so entrenched that week after week of smart moves won't be enough. For this company, it's more like year after year.

[Image courtesy of LeWeb on Flickr]