Investors have for months been asking Yahoo CEO Marissa Mayer about her plans to deal with Yahoo’s remaining shares of Chinese juggernaut Alibaba. Today, she revealed her plan as part of the company’s fourth-quarter earnings report. Mayer said that the company would offload remaining Alibaba stock in a tax-free spinoff called SpinCo.

“The stock of the new company will be distributed pro rata to Yahoo shareholders, resulting in SpinCo becoming a separate publicly traded company,” the company outlined in a press release. The release went on to specify that Yahoo would continue to operate its core business and hold 35.5 percent interest in Yahoo Japan. Meanwhile SpinCo will own Yahoo’s $40 billion worth of Alibaba stock as well as some tangential Yahoo businesses.

As recently as a few weeks ago, activist investor Starboard Value LP was still pressing Mayer for answers and coaxing the executive to merge with AOL.

Yahoo reported revenue of $1.18 billion and non-GAAP earnings per share (EPS) of $0.30. Analysts had expected earnings of $0.29 on revenue of $1.19 billion.

Revenue for all of 2014 came in at $4.2 billion, down from Yahoo’s 2013 total of $4.8 billion.

Yahoo delivered on mobile this quarter with $254 million in mobile revenue. Mobile revenue was $1.26 billion for all of 2014.

Last quarter, Yahoo surprised investors by beating revenue expectations. For the first time ever the company broke out mobile ad revenue earnings, which comprised $200 million of its total revenue of $1.09 billion. Mayer promised that revenue from mobile would surpass $1.2 billion for the year.

Where the third quarter in 2014 was devoted to a spree of acquisitions, Q4 focused on housekeeping. Yahoo started by refining its existing consumer products. Mayer started by sunsetting some of it hyper-local magazines in parts of Latin America, Europe, Africa, and Asia. She also shutdown its online gaming site, Yahoo’s Classic Games. From there, Yahoo tweaked its digital magazines to serve more personalized content, which is then piped into a feed within Yahoo Mail. It also pushed out travel and event notifications linked to Yahoo Mail as well as personalized search.

Speaking of search, during Q4 Yahoo inked a five-year deal with search browser Firefox to make Yahoo its default search engine. The arrangement led to Yahoo quickly usurping 1.6 percent of Google’s share of the search market.

This quarter Yahoo also bolstered its ad offerings. In December, Yahoo scooped up video advertising BrightRoll for $640 million. Shortly thereafter it rolled out detailed insights for BrightRoll advertisers and app install ads on its mobile ad platform, Gemini. Yahoo also expanded its advertising offerings within Tumblr, the blogging platform it acquired in 2013.

Last week Tumblr launched its Creatr program and network, which is essentially an internal talent agency that pairs Tumblr artists with brands for campaigns both within Tumblr and outside of it — and Tumblr’s biggest step towards meaningful revenue.

Mayer’s hard work may be paying off. In after-hours trading Yahoo’s stock is up 7 percent. Investors seem impressed.

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