Yahoo swings axe as profit plunges

 

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By Stuart Turton

Posted on 22 Apr 2009 at 09:09

Yahoo will cut 5% of its global workforce, as it looks to arrest losses that saw the company's profits plunge nearly 80% during the first quarter.

The company said last October it would cut about one-tenth of its workforce, or about 1,600 jobs, leaving it with roughly 13,600 employees at the end of 2008.

This new round of layoffs will affect around 700 people, with Yahoo's chief executive Carol Bartz calling them: "a natural outgrowth of the work we're doing to streamline our structure, globalise products, slim-down our portfolio, and eliminate duplication of efforts."

It may also reflect first quarter revenues that dipped 13% from $1.81bn to $1.58bn, and net income that dropped 78% from $537 million to $118 million in Q1 2009.

Yahoo's financial report comes as speculation mounts that discussions have restarted with Microsoft about an internet search partnership, following last year's failed merger negotiations.

Bartz, who replaced Yahoo co-founder Jerry Yang in January, declined to comment on anything related to Microsoft during the conference call on Tuesday.

But she reiterated her belief that search is a very valuable part of Yahoo's business.