Internet giant Yahoo! has posted a profit of $153 million (Rs 693 crore) in

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the quarter ended December 2009 on the back of improving advertising market.

In the year-ago period, the company had a net loss of USD 303 million, Yahoo! said in a statement.

Yahoo! posted a revenue of USD 1.73 billion in the fourth quarter of 2009, down 4 per cent from a year ago. However, compared to previous quarter, revenues grew by 10 per cent.

The company's revenue from display ads, which are core to its business, jumped 26 per cent over the previous quarter. Online search ads, inched up 4 per cent - the first quarter-on-quarter increase since the third quarter of 2008.

"The fourth quarter marked a strong finish to 2009, which was a transformative year for Yahoo!," the company's chief executive officer Carol Bartz said.

"We beat the high end of our revenue guidance, saw demand for premium display advertising improve significantly, and grew Owned & Operated search advertising revenue sequentially for the first time since the third quarter of 2008."

Yahoo!, which has been facing competition from rival Google Inc. The company has reportedly lost share in the search-engine market after entering into a deal with Microsoft Corp last year, to divest some of its search-engine technology.