Surprised!?

Yahoo is one of the best-known brands on the internet, but its core internet business is in a grim situation. How grim? There's a debate over whether the company itself — what most of us think of when we think of Yahoo — is actually worth less than zero dollars.

Back in 2005, Yahoo invested $1 billion in one of China's hottest technology startups, Alibaba, getting a roughly 40 percent stake. The bet has paid off handsomely. In 2012, Yahoo sold part of its stake back to Alibaba for $7.6 billion. Since then, Alibaba has continued to grow rapidly, and Yahoo's remaining stake is now worth around $25 billion.

That number is remarkable because Yahoo as a whole isn't worth much more than that. Indeed, if you subtract the value of all of Yahoo's major assets — including a multibillion-dollar stake in Yahoo Japan (an independent subsidiary in which Yahoo is a minority shareholder) and a few billion dollars in cash — from its market value, you get a big negative number. "If you just solve for the missing number, you are forced to conclude that Yahoo's actual core business of being Yahoo (and Tumblr and whatever) is worth negative $13 billion," as Bloomberg's Matt Levine put it in December.

I don't think that's true, for reasons I'll get into shortly. But it's created a secondary crisis for the company — and a deep distraction for its CEO, Marissa Mayer.

In 2012, Yahoo's board hired Mayer, then one of Google's best-known executives, to turn the company around. Nearly four years later, it's becoming clear that her turnaround effort is failing. Mayer has invested lavishly in both engineering and media talent, but there's no sign that these investments are paying off in the form of higher revenue.

And over the past year, Mayer's management of Yahoo the business has been overshadowed by an argument over whether Yahoo can distribute its Alibaba holdings to shareholders without paying billions of dollars in taxes on them.

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