Yahoo to Cut 15% of Workforce, Lays Out Plan to Streamline

But it also involves cost-cutting – beyond the job reductions, Yahoo said that it would close five of its global offices – in Dubai, Mexico City, Buenos Aires, Madrid and Milan.

Mayer said she believes Yahoo is now in a position of strength after building mobile operations with 600 million monthly users and a billion dollar advertising business.

Yahoo says it will explore “strategic alternatives” for its struggling Internet businesses including getting rid of services and assets that CEO Marissa Mayer has decided are not worth continued investment of time and money.

Yahoo Inc is cutting its workforce by 15 percent, meaning it will reduce the number of its employees to about 9,000 people by the end of 2016.

Mayer is aiming to slash the company’s expenses by $400 million a year by the end of 2016.

Maynard Webb, Yahoo chairman, said: “The board also believes that exploring additional strategic alternatives, in parallel to the execution of the management plan, is in the best interest of our shareholders”. “This is a strong plan that calls for bold shifts in products and resources”.

The company’s plans to turn around its struggling core business are set to dominate its earnings report, with investors keen to see if CEO Marissa Mayer will push ahead with a proposed spin-off or entertain calls for a complete sale. The job cuts were estimated at 1,700, or about 15% of its total workforce.

Yahoo will have three consumer products globally: Search, Mail, and Tumblr, and four verticals: News, Sports, Finance and Lifestyle in growth markets U.S., Canada, U.K., Germany, Hong Kong, and Taiwan.

This write-down wiped out any hope of Yahoo making a profit in 2015, and the company posted a loss of more than the full value of the write-down at $4.74bn.

Various analyst estimates had expected the Silicon Valley Internet giant to deliver revenue of $1.2 billion, a flat performance with lowered earnings of 13 cents. Plus, it plans to sell some of its nonstrategic patents and real-estate holdings, which will generate over $1 billion.

Up to Tuesday’s close of $29.06, Yahoo’s shares had fallen 35 percent in the past 12 months.

The company also reported its fourth quarter results on Tuesday, maintaining its barely profitable trajectory. This is compared to a net income of $166m, or $0.17 per share, for the same period in 2014.

Traffic-acquisition costs, the amount Yahoo invests to attract users to its websites, increased to $271m from $74m a year earlier.