Last week, Yahoo reported that their second-quarter profits topped analysts’ expectations, but overall sales fell short and company shares took a hit in after-hours trading.

For the quarter, in total, Yahoo reported earnings of $0.15 per share. Well, this is a penny higher than analysts were expecting and 53% ahead of the same period last year. Their net income for the quarter totaled $213 million – that is 51% above last year’s mark.

However, minus the fees paid out to advertising partners, their overall revenue actually fell slightly short. Missing the consensus forecast of $1.16 billion, Yahoo ended up reporting a new revenue of $1.13 billion.

Shares of the company were down more than 4% in extended trading.

The flipside is that they turned in nice growth in advertising business, with display revenues on Yahoo’s properties up 19% from the one-year period.

Yahoo’s new CEO Carol Bartz told us:

“We’re pleased that we continued to deliver strong operating income and margin expansion…Our search fundamentals are improving and we posted another quarter of healthy display advertising growth…With regard to search, we gained share in the quarter, but we didn’t monetize searches as much as we expected…On the display side, with our owned-and-operated sites, we saw healthy ad spend up 19 percent but the second week in June, we saw demand slow down and a handful of advertisers pull back…The first three weeks in July indicate that we’re back to normal.”

With 18 months at the helm, Carol Bartz has set Yahoo into a refocusing of the content across its network of sites; this being the backbone of its display-advertising business. As well as expanding its staff of reporters and bloggers, the company also has been pondering potential acquisition targets, and last May they even shelled out $100 million to buy Associated Content, a company which employs a vast network of freelance writers to produce articles assigned around popular search topics.

The company has also struck up partnerships with mega-social sites such as Facebook and Twitter, thereby enabling users to share and view their content with their social networks on Yahoo’s Web properties.

On the search side of things, Yahoo continues to rush forward with the migration of its engineering platform to Microsoft’s Bing.