- Kyle Chua
Yahoo Cutting More Than 20% of Staff by End of the Year
Another tech company is making headlines for announcing job cuts.
Yahoo told Axios that it's laying off more than 20% of its total workforce by the end of the year, and of that percentage, 12% are leaving the company today – over 1,000 workers. The remaining 8% of the planned cuts are set for the second half of the year. No less than 1,600 workers are expected to be impacted by both rounds of cuts
Most impacted by the cuts is Yahoo's advertising tech unit, Yahoo for Business, which is losing 50% of its workers by the end of the year as part of a restructuring.
"These decisions are never easy, but we believe these changes will simplify and strengthen our advertising business for the long run, while enabling Yahoo to deliver better value to our customers and partners," a spokesperson for the company said in a statement.
Yahoo CEO Jim Lanzone emphasised that the job cuts are because of strategic changes the company wants to implement, not because of financial challenges. He said the advertising unit hasn't been profitable for Yahoo, which is why resources are now being diverted to other parts of the business. Axios notes that Yahoo as a whole is profitable, with an annual revenue of about US$8 billion.
As part of the changes, Yahoo is shutting down the supply-side platform of its advertising business – the part that helps publishers sell ads on content. The internet pioneer is instead hedging its bet on its demand-side platform that helps advertisers buy ads across publisher websites. That part of the business is being renamed to Yahoo Advertising. The ads sales teams are reportedly prioritising company-owned properties like Yahoo Finance, Yahoo News and Yahoo Sports.
The changes seemingly mark an end to Yahoo’s competition with the likes of Google and Meta for advertising dominance, with it now focusing on a different strategy.
"The moves are meant to simplify and strengthen the good parts of the business, while sunsetting the rest," Lanzone said.
Yahoo's announcement comes amid a string of high-profile job cuts among tech giant. The first two months of the year saw the likes of Microsoft, Dell and Zoom all announce they were sacking thousands of workers each, hinting that 2023 won't be any different from 2022 with regards to job security in the tech industry.
Yahoo announced it's laying off more than 20% of its total workforce by the end of the year, and of that percentage, 12% are leaving the company today – over 1,000 workers.
The remaining 8% of the planned cuts are set for the second half of the year.
Yahoo CEO Jim Lanzone emphasised that the job cuts are because of strategic changes the company wants to implement, not because of financial challenges.