Yahoo is Laying Off 20% of its Staff – Yahoo has announced plans to cut its workforce by over 20%, leading to the termination of more than 1,600 jobs primarily in the advertising department. In a discussion with Axios, Yahoo CEO Jim Lazone stated that the layoffs are not caused by financial struggles within the company, but rather by the unprofitability of the Yahoo for Business advertising unit.
Jim Lazone further noted that the layoffs would result in a reduction of 50% of the current employees in the advertising unit. The layoffs are expected to take place before the end of 2023. It was reported that approximately 1,000 positions were shed when the news of the layoffs was announced on February 9th.
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In further comments that are unlikely to soothe the ears of employees who are set to lose their jobs, Lazone said that the company layoffs and restructuring would be “tremendously beneficial for the profitability of Yahoo overall” and would allow the tech company to “go on the offense” and invest in parts of Yahoo that are profitable.
In 2021, Apollo, a global private equity firm, acquired Yahoo and AOL for $5 billion from Verizon, and appointed Jim Lazone as the CEO of Yahoo. Historically, Yahoo has assisted digital publishers and companies in selling automated advertisements alongside their content, but this aspect of the business has not been a source of profitability for the company.
According to Axios, as part of its restructuring efforts, Yahoo plans to discontinue its native advertising platform Gemini and form a new partnership with ad tech company Taboola. This partnership will enable Yahoo to sell advertising on its own content. In recent months, advertisers globally have reduced their budgets due to concerns about high inflation rates and the possibility of a recession.
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