Yahoo chief executive Jerry Yang said his company remained open to a potential deal with Microsoft, reports Reuters.
Earlier this month, Microsoft walked away from a proposal to acquire Yahoo for almost £24bn, after Yahoo held out for a higher offer.
Yang said, "We did not walk away from that proposal. Microsoft did." Yang said a combination with Microsoft would have had "a tremendous amount of power".
Last week, Microsoft made an approach to Yahoo to form a partnership, stopping short of a merger.
Yang said, "Microsoft is no longer interested in buying the company, and we are talking about other things. We definitely have to understand what they're proposing they clearly have an interest in Yahoo, and we need to understand more."