Google may be sailing along, but it's another story for Yahoo. The company said this week that it will cut at least 10 percent of its workforce, or about 1,500 employees as a cost-cutting strategy. Yahoo has a total of about 15,000 employees.
The reason for the staff reduction is strictly bottom line. Yahoo said that its net income for the quarter fell 64 percent, to $54 million from $151 million a year earlier.
"As economic conditions and online advertising softened in the third quarter, we remained highly focused on our 2008 strategy to invest in initiatives that enhance not only our long-term competitiveness, but also our ability to deliver for users and advertisers even in this more difficult climate," Jerry Yang, Yahoo's chief executive, said in a statement.
Analysts said Yahoo is struggling in its two key business segments: Search and display advertising. Yahoo is attempting to address these issues. It signed a search advertising partnership with Google in June, but that deal is now under review by federal regulators. Yahoo has been talking with AOL about a possible merger to create a powerhouse in display advertising, as well. So far, the companies have not been able to agree on a price.
For more on Yahoo:
- see this New York Times article [1]
Related Articles:
Yahoo goes with Google [2]
Google-Yahoo ad deal delayed [3]
Links:
[1] http://www.nytimes.com/2008/10/22/technology/companies/22yahoo.html?_r=1&hp&oref=slogin
[2] http://www.fiercecio.com/story/yahoo-goes-google/2008-06-17
[3] http://www.fiercecio.com/story/does-google-yahoo-deal-need-oversight/2008-10-04