“Yahoo to slash jobs, sell some `non-strategic” assets

The California company reported a loss of $4.43 billion in the final three months of past year, due mostly to lowering the value of its US, Canada, Europe, Latin America and Tumblr units.

“A simpler product portfolio more focused on Yahoo’s strengths will allow the Company to more quickly improve offerings to increase profitability”, said Mayer in a statement.

The planned restructuring announced on Tuesday includes the closure of offices in five locations, a paring down of its products, shifting more resources to mobile search, and the sale of some nonstrategic assets such as property and patents. The company will reduce its workforce by about 15 percent and close offices in Milan, Madrid, Buenos Aries, Dubai and Mexico City. During its recent quarter, Yahoo pulled in $1.27 billion in revenue, but had a massive write-down of $4.5 billion.

In doing so, Yahoo would cut a sixth of its global workforce and shrink its employee base to roughly 9,000.

Mayer fired back at many of Jackson’s claims during Tuesday’s conference call, characterising the lavish spending allegations as “gross mischaracterizations and untruths spread about Yahoo”.

Ms Mayer expressed confidence that her plan to run Yahoo as a smaller, more focused company “will dramatically brighten our future and improve our competitiveness, and attractiveness to users, advertisers, and partners”.

It will also focus on its “digital content strongholds”, which include Finance, News, Sports and Lifestyle. After subtracting ad commissions, revenue plunged 15% to $1 billion compared with the previous year – the biggest drop since Mayer became CEO in July 2012.

In addition, Yahoo board is “exploring additional strategic alternatives”, which it believes is “in the best interest of shareholders”.

“Just doing some (job) cuts, whether it’s 10 percent or 25 percent or 35 percent, still doesn’t solve the problem that you still have Marissa Mayer running the company with the existing board”, Jackson said.

“Cutting costs and focusing on its areas of revenue growth should make the operating business more attractive to a potential buyer”, said Paul Sweeney, an analyst at Bloomberg Intelligence.

“Today, we’re announcing a strategic plan that we strongly believe will enable us to accelerate Yahoo’s transformation”, said Marissa Mayer, CEO of Yahoo, in the announcement. These ideas added up to distrust in Mayer’s ability to lead the 20 year-old company. That has irked investors like Starboard Value, which has pushed for a sale of the core assets. Verizon acquired AOL Inc. for $4.4 billion a year ago. We are extremely proud of the billion dollar-plus business we have built in mobile, video, native, and social.