New Yahoo boss admits that things are bleak

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Yahoo's new CEO has just emerged from his office having seen all the books and realised what a poisoned chalice he has taken on.

Scott Thompson said that there was no question that Yahoo needed to do a lot better and he thinks that reviving the company's flagging display advertising business was the way forward.

This is stage one of a cunning plan which will involve something a little more bolder later on. Thompson told Reuters that Yahoo needed to "get innovative products that matter into the market." Wall Street appears to be willing to give the former PayPal president some breathing room to settle in and figure out a strategy.