The fourth quarter of 2010 could have gone much worse for Yahoo, judging from the earnings report the company released this afternoon.  Yahoo’s numbers were generally higher than what analysts expected, perhaps earning Carol Bartz a few points in unhappy shareholders’ eyes.  A low Q1 forecast threw a long shadow, however.

To first cover the fourth quarter: experts believed Yahoo would report $1.50 billion in gross revenue and $1.19 billion in net revenue.  Instead, the company managed to report $1.53 billion and $1.21 billion, respectively.  And Yahoo reported $0.24 in terms of earnings per share, as well, rather than the $0.22 that was expected.

Bartz stated as a result, "We just completed a very encouraging quarter and year for Yahoo!, where we saw our plans to turn around the company gain momentum.  For the year, operating income, margins, EPS, and return on invested capital doubled.  Display advertising grew 17%.  We completed the important North America Search transition to Microsoft on schedule and with high quality.  We introduced new and updated products at a faster pace.  And our content properties – like Yahoo! Sports and Yahoo! Finance – continued to innovate and extend their massive lead."

Unfortunately, 2011 isn’t looking so bright at the moment.  Yahoo thinks it’ll earn between $1.02 billion and $1.08 billion in revenue during the first quarter, while analysts would prefer to see $1.13 billion.  Also, the company’s cash, cash equivalents, and investments in marketable debt securities fell by almost 20 percent between December 31st of 2009 and December 31st of 2010.

This has caused some shareholders to back away from Yahoo’s stock.  It’s down 2.12 percent in after-hours trading right now, following a loss of 0.44 percent during the normal trading day.