Yahoo has already cut around 2,400 jobs in the last two years as their market share declined in light of increased competition from Google. There are now slightly more than 13,000 employees at Yahoo.

Yahoo has really lost ground in the display-ad business as advertisers switched to different ad networks, in particular to Google. Yahoo, like many online giants, has decreased the price of ads in the face of diminishing demand.

Google is also expected to announce an erosion in sales revenue, although it’s not likely to be as dramatic as it was for Yahoo.

Although they probably didn’t dance in the streets, analysts were probably still ecstatic that Coca Cola’s earnings exceeded their estimates. That’s as rare as lunar eclipse these days on Wall Street.

Foreign expansion pushes revenue growth

One area where KO excelled was in growing foreign markets. The company say double digit sales growth in China, Eastern Europe, and India.

The company earned $995 million, which translated to 43 cents per share, in the quarter that ended December 31st 2008. This was down from $1.21 billion, or 52 cents per share, in the 2007 period.

“Our performance in the fourth quarter was very solid,” said CEO Muhtar Kent in a statement.

Overall revenue was lower at $7.13 billion from $7.33 billion a year ago. This represented a 3% decline in sales.

The real money’s in water

Coca-Cola has done an excellent job in recent years marketing water. H20 is a big hit with consumers, and adds to the bottom line. But water wasn’t the only product that sold well.

Overall unit case volume grew 4 percent during the quarter, and Coca-Cola, the flagship product, managed a 2% gain. Even in troubled times, people still wanted their coke.

The company has recently opened the World of Coca Cola in Atlanta to showcase company history.

Coca-Cola is still the real thing when it comes to business.

Net income rose 8.7 percent to $225 million, or 52 cents a share, the company said yesterday after markets closed. Sales climbed 18 percent to $6.7 billion. That beat estimates of 38 cents in profit and $6.45 billion in sales from a Bloomberg survey of analysts.

Amazon benefited from a huge quarter because they have what customers are looking for in a recession: cheap prices, huge selection, and convenience. The company has also focused on customer service over the years, so repeat business is a big factor in their success.

Shares of Amazon were up $7.31 in pre-market trading and continued to move throughout the day.

Amazon also announced strong guidance for 2009, bucking the trend for many publicly traded companies. Investors are particularly glad that Amazon won’t have to slash prices in order to stay competitive. The company has been able to hold the line with pricing, which has managed to keep net earnings in line with expectations.

Profits narrowed a bit in the final quarter, to $7.82 billion as crude oil futures continued to decline throughout the year.

US oil giant Exxon Mobil on Friday notched a 45.22 billion dollar record net profit in 2008 despite a 33 percent decline in net income in the fourth quarter of the year.

Investors reacted to the drop in net earnings by bailing out of the shares, causing the worst decline in 27 hours.

That didn’t stop the company from announcing an expansion program.

Exxon’s $36.7 billion cash hoard, which exceeds those of Microsoft Corp. and Warren Buffett’s Berkshire Hathaway Inc., gives Exxon Mobil the unique opportunity to buy assets cheapened by a $100-a-barrel plunge in crude prices, said analyst Neil McMahon of Sanford C. Bernstein & Co. in London. Investing now will mean a return to record profits when the world’s largest economies recover and fuel demand rebounds, McMahon said.

The only thing left for Exxon execs now is to pop the cork in their champagne bottles and pay themselves huge bonuses. It shouldn’t take much to convince them to do that.

The numbers were much worse than most analysts expected.

Either way, the results were substantially worse than what analysts were anticipating. Consensus estimates were for a loss of $298 million, or 34 cents a share, according to Thomson Reuters.

Just a month ago, analysts were widely expecting Morgan Stanley to report a narrow profit for the quarter. But they steadily lowered their earnings expectations for the firm given the ongoing volatility in the financial markets.

The quarter was almost universally bad for the company who lost across almost every segment they operated in. It’s also a bad year for Morgan Stanley employees, who will see their bonus pool halved.

Right now Morgan Stanley is looking to add deposits to its’ array of financial resources, because traditional sources have dried up. Yesterday rival Goldman Sachs announced a $2.1 billion quarterly loss. The tough times for Wall Street firms continues.

PepsiCo said the job cuts are part of a plan to save $1.2 billion over the next three years. The company makes Pepsi-Cola drinks, Frito-Lay snacks and Quaker foods and have been hit by the fact that people are driving less and eating out less.

“The beverage business was clearly the soft spot. The whole category has continued to be soft this year,” PepsiCo CFO Richard Goodman said.

“The domestic beverage business is at a historically low level. I don’t think there’s been another year in which the industry as a whole has actually seen a volume decline, which is what we’ve seen,” he added.

Analysts weren’t happy about ADM’s numbers.

“Two of ADM’s divisions that are notoriously hard to predict came in significantly below our expectations,” wrote David Driscoll in a research note. “With investors already jittery on the overall (agricultural environment), today’s report from ADM should serve to exacerbate those sentiments.”

ADM is also one of the nation’s largest ethanol producers, so lower energy costs also weighed on investors, who decided to dump shares and look for greener pastures.

Corn prices have risen 40% this year. That has experts worried that there will be a greater erosion in profits at ADM in the next few months.

With oil finishing below $119 per barrel, investors are also worried that demand for the more expensive ethanol could quickly fade. Despite the dire predictions, corn processing profit, which includes ethanol, was up 14 percent to $262 million. This move was largely credited to higher ethanol sales volume and higher average selling prices for sweeteners and starches.

The main reason is that crude oil prices for the latest quarter averaged double what they did one year ago.

Earnings are expected to look like this for the top five players:

1) XOM.N – Exxon to earn over $12 billion in earnings for the quarter
2) RDSa.L – Royal Dutch Shell expected to top $8.3 billion for the quarter
3) BP.L – BP should net $7.7 billion

Yes, these are the highest ever recorded profits for these three companies. It’s fair to say the higher price we’re all paying at the pump is immensely helping the bottom line at this Big Oil behemoths.

Of course one issue pushing higher inflation and consumer worries is the high cost of crude oil, which is expected to go past $150/barrel for the first time this week. Beleaguered motorists are already changing travel plans, curtailing unnecessary trips, and cutting back on purchases in order to make ends meet, but one has to wonder how much further they can bend before they break.

Gasoline prices are up a stunning 50% in 2008, which is further making the Fed’s job of trying to jumpstart the economy difficult. Investors this week will be looking for any signs of good economic news. Barring that, more money may go from the dollar into Oil, creating even higher energy costs. Depending on what Ben Bernanke does with interest rates, high inflation might just set in for the remainder of 2008.

People looking to invest in stocks this week will probably do best to look at companies who have at least some isolation from rapidly rising fixed and supply costs.

On Tuesday of this week the National Association of Realtors will be releasing data on new home sales. On Thursday you can expect to learn about the employment numbers when they Labor Department releases key job figures. Finally, on Friday, the University of Michigan will be releasing key consumer confidence numbers.

Investor sentiment moving forward will have a lot to do with the results of the data released in these reports this week.

Google leader Eric Schmidt cooed about the company’s prowess. “It’s clear we are well positioned for 2008 and beyond, regardless of the business environment we are surrounded by,” said Schmidt.

Revenue was $5.19 billion, up 42 percent from 2007′s $3.66 billion. Earnings were $1.31 billion, or $4.12 per share, for the first three months of 2008, compared with $1 billion, or $3.18 per share, in the first quarter of 2007.

Google’s shares immediately rallied almost 18% on the news.