Yahoo to slash jobs, sell some `non-strategic" assets
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Los Angeles - Internet pioneer Yahoo announced radical measures Tuesday to salvage its struggling business, including job cuts and the possible sale of "non-strategic" assets, as it posted a 4.4 billion dollar quarterly loss.
The company said it would cut about 15 per cent of its workforce and close offices in Madrid, Milan, Dubai, Mexico City and Buenos Aires.
The cuts will pare the company's staff to about 9,000 and fewer than 1,000 contractors - less than half 2012 levels - and reduce operating costs by 400 million dollars a year, Yahoo said in a press release.
The Sunnyvale, California-based company said it would explore"strategic alternatives" including sale of at least some of itsholdings. Yahoo believes it can generate an additional 1 billion to 3billion dollars by shedding assets that are not essential to its core business, including real estate and some patents, the company said.
The news follows months of speculation that Yahoo might put itself up for sale.
The 4.4-billion-dollar loss for the quarter ending December 31 followed a fourth-quarter profit of 166.3 million a year before.
Revenue, largely dependent on advertising sales, grew only 1.6 percent to 1.27 billion dollars.
The results were worse than analysts expected, and Yahoo shares lost more than 2 per cent in after-hours trading.
Despite efforts by a string of leaders, most recently chief executive Marissa Mayer, Yahoo's core online advertising business has never quite taken off, and the question of how to leverage hundreds of millions of users into a profitable business remains unanswered.
Yahoo is still considering how best to spin off its most valuable asset, its investment in Chinese e-commerce giant Alibaba.
The original plan was to sell Yahoo's 15 per cent share and distribute the proceeds to shareholders tax-free. But shortly before the sale planned for early 2016 it remained unclear whether the sale would be subject to taxation or not.
Instead Yahoo may instead spin off its core internet business into a separate company that would belong to Yahoo shareholders.
- DPA
