SAN FRANCISCO — Yahoo is laying off 2,000 employees as new CEO Scott Thompson eliminates jobs that don't fit into his plans for turning around the beleaguered Internet company.
The cuts announced Wednesday represent about 14 percent of the 14,100 workers employed by Yahoo.
Yahoo estimated it will save about $375 million annually after the layoffs are completed later this year. The Sunnyvale, Calif.-based company will absorb a pre-tax charge of $125 million to $145 million to account for severance payments. The charge will reduce Yahoo's earnings in the current quarter.
Workers losing their jobs were notified Wednesday. Some of the affected employees will stay for an unspecified period of time to finish various projects, according to Yahoo.
The housecleaning marks Yahoo's sixth mass layoff in the past four years under three different CEOs. This one will inflict the deepest cuts yet, eclipsing a cost-cutting spree that laid off 1,500 workers in late 2008 as Yahoo tried to cope with the Great Recession.
The previous purges under Yahoo co-founder Jerry Yang and his successor, Carol Bartz, boosted earnings. But trimming the payroll didn't reverse a revenue slump, which has disillusioned investors yearning for growth at a time when more advertising is flowing to the Internet.
The cuts are part of an overhaul aimed at focusing on what Thompson believes are Yahoo's strengths while also trying to address its weaknesses in the increasingly important mobile computing market.
Thompson is betting Yahoo will be able to sell more advertising if it's more astute in the analysis of the personal information that it collects from the roughly 700 million people who visit its website each month. He is also looking for ways to improve the products that it makes for smartphones and tablet computers, a goal that may require hiring more specialists in mobile technology.
Yahoo also has been exploring selling a service, called Right Media, that helps place ads around the Web. If a deal gets done, that would enable Yahoo to shed even more workers.
The layoffs "are an important next step toward a bold, new Yahoo — smaller, nimbler, more profitable and better equipped to innovate as fast as our customers and our industry require," Thompson said in a statement.
- Dave Ramsey says: Don't leave an estate with...
- Renewable energy advocates decry proposed...
- The Gateway adding new dining concept
- Z'Tejas closing after 13 years at The Gateway
- Balancing act: Survey says lack of balance,...
- Overstock employees ride bicycles to work to...
- Protesters from across U.S. arrested at Utah...
- Battered by recalls, GM buoyed by its large SUVs
- Renewable energy advocates decry... 15
- Protesters from across U.S. arrested at... 12
- Obama gives protection to gay,... 7
- New solar energy project at Utah... 6
- Balancing act: Survey says lack of... 4
- Parks visitors spent $596M in Utah last... 4
- Beef pollutes more than pork, poultry,... 2
- Airlines scrap Israel flights over... 2