With a tip of the hat to Google, Yahoo has added the geography of geo-targeted search ads below the ad text.
For example, a search for 'lawyers' from our office in Seattle returns this result:
Prior to this, the ads wouldn't state the geography at all. I haven't seen data on this, but I would expect geotargeted ads with the location called out would perform better than those that don't (more screen real estate, relevance, etc.)
We first detected these ads late last week, but at first expected they were just testing them and they would disappear. However, it appears they are here to stay. There is a remote chance that these are actually Google ads, but we haven't seen these exact ads on Google.
I would expect that this would increase the frequency of reverse-geotargeting on Yahoo.