Yahoo to Lay Off 15 Percent of Workforce, Revamp Company

Up to 2,000 staff were affected by the immediate changes, the company said, which would involve the closure of regional offices worldwide in Dubai, Mexico City, Buenos Aires, Madrid, and Milan. According to Yahoo, the size of the workforce next year would be about 42 percent smaller than it was in 2012, consisting of about 9,000 employees and less than 1,000 private contractors.

Yahoo said it will reduce operating expenses by more than $400 million by the end of the year.

The announcement accompanied Yahoo’s fourth-quarter report in which the company reported a loss of $US4.4 billion ($A6.24bn) on revenue of $US1.27bn, up 1.6 per cent year-over-year.

Sunnyvale, California-based Yahoo reported fourth-quarter loss of $4.43 billion or $4.70 per share compared with $166.3 million or $0.17 per share previous year.

In a call with analysts and investors, Mayer said Yahoo will focus its efforts around its search, mail and Tumblr products in its U.S., Canada, U.K., Denmark, Hong Kong and Taiwan markets. She added that this meant focusing on Yahoo’s mobile, video, social and “native offerings” to help drive online advertising revenue. It will also be even more bullish on mobile with upcoming changes to the sports and finance apps and the recent change to the search app. We’ve tripled our mobile audience to more than 600 million monthly users, improved many partnerships, streamlined our data centers, hired incredible technical talent and invested wisely to meet future needs.

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

Yahoo also said it has begun to explore divesting non-strategic assets, such as sales of patents and real estates.

In fact, facing an uncertain economy, several big name companies have also announced downsizing and cost cutting initiatives.

When Yahoo acquired Tumblr, it said its cash, securities, tangible assets, technology, customer relationships, and name were worth $356 million and then the remaining $751 million was goodwill, nearly a third of which was written down at the end of 2015. As a result from this plan, Tahoo is expected to lead to modest and accelerating growth in 2017 and 2018. “A simplified Yahoo will yield better focus, execution and ultimately increase shareholder value”.

Charles Schwab resigned from Yahoo’s board of directors, effective immediately, but was due to his time and “not due to any disagreement”, said CNBC.

In December, Yahoo abandoned plans to spin off its stake in Chinese e-commerce giant Alibaba Group and announced that it would instead do a reverse spinoff of its other assets, putting those businesses into a separate, publicly traded company.

Up to Tuesday’s close of $US29.06, Yahoo’s shares had fallen 35 per cent in the past 12 months.