However, despite Yahoo's announcement about the hack, the company's customer trends showed growth in pageviews and email usage, Yahoo said.
"I am pleased with our Q3 results. This quarter, we launched several new products and showed solid financial performance across the board; both are a testimony to the tremendous teamwork, focus, and resilience of our employees," said Marissa Mayer, CEO of Yahoo. “In addition to our continued efforts to strengthen our business, we are busy preparing for integration with Verizon. We remain very confident, not only in the value of our business, but also in the value Yahoo products bring to our users’ lives. To that end, we take deep responsibility in protecting our users and the security of their information. We’re working hard to retain their trust and are heartened by their continued loyalty as seen in our user engagement trends."
Yahoo's revenue from Mavens - the mobile, video, native and social advertising units - rose 24.2 percent to $524 million. Mavens revenue represented 38 percent and 42 percent of traffic-driven revenue in the third quarter of 2015 and 2016, respectively.
On the other hand, gross search revenue fell 14.1 percent to $752.5 million.
Total revenue rose 6.5 percent to $1.31 billion. But after deducting fees paid to partner websites, revenue fell to $857.7 million from $1 billion.
For the third quarter ended Sept. 30, net income attributable to Yahoo rose to $162.8 million from $76.3 million a year earlier.
Verizon plans to combine Yahoo's search, email and messenger assets as well as advertising technology tools with its AOL unit, which it bought last year for $4.4 billion.
The deal is expected to close in early 2017, after which Yahoo plans to change its name and become a publicly traded investment company.