The deal represents Ms Mayer's boldest move yet since she left Google 10 months ago to lead Yahoo's latest comeback attempt. It marks Yahoo's most expensive acquisition since the Californian company bought Overture for $1.3bn a decade ago.
Tumblr now figures to play a pivotal role in Ms Mayer's attempt to reshape Yahoo.
She is betting that Tumblr, a six-year-old service started by high school dropout David Karp, will provide Yahoo with a hook to reel in more traffic and advertisers on smartphones and tablets.
The companies say Tumblr will remain independently operated and Mr Karp will stay chief executive.
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