Yahoo cuts 15% of its Workforce

Stephen L Kanaval |

35, 40, 45, 50, do I hear 60?

Yahoo inched closer and closer to being sold today with a proposal that will cut around 1,600 jobs. The company will also close five international offices. Shareholders are urging the company to cut its losses and sell. Investors have been at odds with Chief Executive Marissa Mayer who wanted to sell the company's $30 billion piece of Alibaba. This worried investors because it would have led to a titanic tax penalty. On top of that was her acquisition of Tumblr, which paid off little to nothing. These ideas added up to distrust in Mayer's ability to lead the 20 year-old company.

Most analysts believe the strategic move would be to sell off the core business. Even though the company made $1.27 billion in revenue during the last quarter, it had a writedown of $4.5 billion. The blogs, search, and mail will be bolstered as the company tries to focus on its strengths. This was outlined today in a three-legged stool strategy, as well as some defensive talk about how the company was managing its spending responsibly (reports abounded about a $7 million Christmas party).

Most likely, this move by Mayer does nothing but buy her time to sell the company. Verizon has expressed interest in buying Yahoo. The company is being dwarfed by advertising giants like Google and Facebook. Charles Schwab and Max Levchin both recently resigned from the board, and it would seem that Mayer is putting on a good face before she throws dresses this pig up for auction.

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