Date
25 May 2017
Yahoo CEO Marissa Mayer is expected to unveil a huge cost-cutting plan as the firm's revenues haven't kept pace with expenditure. Photo: Bloomberg
Yahoo CEO Marissa Mayer is expected to unveil a huge cost-cutting plan as the firm's revenues haven't kept pace with expenditure. Photo: Bloomberg

Yahoo to cut workforce by up to 15%, close many units: WSJ

Yahoo Inc. is set to unveil a cost-cutting plan that will include up to 15 percent reduction in the firm’s workforce and closure of several business units, the Wall Street Journal reported, citing people familiar with the matter. 

CEO Marissa Mayer is expected to make the announcement after the company releases its fourth-quarter results on Tuesday, the report said.

The move comes after hedge fund Starboard Value sent a letter to Yahoo last month calling for new management and a sale of the business.

Making the company smaller and more profitable could help Mayer buy time with investors and bolster her case in a possible proxy fight with Starboard Value, the Journal noted.

Mayer said in October that she was preparing to narrow the company’s focus to fewer areas.

Since then, the company has rattled investors by shelving a plan to spin off shares in Alibaba Group and failing to explore a sale of the business.

Yahoo’s expenses have risen while revenue has declined since Mayer took the reins three-and-a-half years ago. 

The firm’s annual earnings before interest, taxes, depreciation and amortization is expected to fall below the US$1 billion mark for the first time in six years.

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RC

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