Yahoo, after a steady decline in both market share and stock price , is planning to lay off hundreds of employees in an effort to increase its profitability, raise its stock price and narrow its focus to improve profitability.
From NYT:
“The final number of layoffs from Yahoo’s work force of about 14,000 is yet to be determined and is likely to be announced around the end of the month, perhaps during Yahoo’s conference call on Jan. 29 with analysts after it reports fourth-quarter results, these people said.
Yahoo declined to comment specifically on any plan for layoffs. In an e-mail statement, a company spokeswoman, Diana Wong, said: “Yahoo plans to invest in some areas, reduce emphasis in others, and eliminate some areas of the business that don’t support the company’s priorities. Yahoo continues to attract and hire talent against the company’s key initiatives to create long-term stockholder value.”
The statement echoes a strategy sketched out in recent months by Jerry Yang, the company’s co-founder, who was appointed chief executive last summer amid growing shareholder dissatisfaction.
After a 100-day review of the company, Mr. Yang said in October that Yahoo would focus on three areas: becoming a “starting point” for the most consumers on the Web; extending its advertising offerings to sites across the Web; and opening up Yahoo’s technology infrastructure to third-party developers and publishers.
The strategy is aimed at revitalizing Yahoo, which has been eclipsed by Google in Internet search, and has faced increasing competition from social networks like MySpace and Facebook. As a result, Yahoo’s share of the overall online advertising market has declined. Still, the company remains a powerful force on the Internet, with about 500 million people visiting its sites around the world each month.”
Jeff B. : Yahoo has struggled to maintain its search business and its paid advertising has consistently been less profitable than Google’s. I would not be surprised to see down the road, Yahoo outsourcing its sponsored listings to Google.
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