Yahoo to Drop Services in the Wake of Layoffs

By Cindy Waxer December 17, 2010

In the wake of laying off 600 employees, Yahoo Inc. is gearing up to shutter more of its services, according to an Associated Press report. Among the services on the company’s endangered list: content-sharing site Delicious, MyBlogLog, Yahoo Buzz, Yahoo Picks and Yahoo Bookmarks, reported AP.

Yahoo reduced its workforce by four percent earlier this week – a move that industry observers view as an attempt to cut costs and expand the Internet giant’s operating profit margins.

Such trimming was earlier predicted by technology blog TechCrunch which reported as far back as November that Yahoo was preparing to lay off 20 percent of its total staff. Citing two unnamed sources, the post read:

“Yahoo is preparing to lay off 20 percent of total staff, we’ve heard from two independent sources, and managers have been asked to begin to make the tough decisions on who stays and who goes. This news comes just days after Google announced a 10 percent pay raise and $1,000 spot bonus for all employees. This is a story we’ve been tracking down for weeks.”

Yahoo retaliated by announcing that TechCrunch’s post simply isn’t accurate.

“Yahoo is always evaluating expenses to align with the company’s financial goals,” Charles Sipkins, a spokesman for the Sunnyvale, California-based company, said in an e-mail, as reported by Bloomberg. “However, a 20 percent reduction in Yahoo’s workforce across the board is misleading and inaccurate.”

This has been a tough season for Yahoo. In early November, rumors swirled of a pending takeover when the company revealed another quarter of less-than-impressive revenue results, according to industry observers. Yahoo reported revenue of $1.6 billion for the third quarter of 2010, a mere 2 percent increase from the third quarter of 2009.

In October, TechZone360.com reported that three top Yahoo Inc. executives announced their departure from the company, putting the pressure on CEO, Carol Bartz, as she approaches the end of her second year.

The defecting executives included Hilary Schneider, an executive vice president who spearheaded Yahoo’s advertising in the U.S.; David Ko, a senior vice president in charge of mobile and audience; and Jimmy Pitaro, a vice president who ran the division that produced the heavily trafficked news, sports and finance sections of Yahoo’s website. 




Edited by Jaclyn Allard

TechZone360 Contributing Editor

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