Date: Wednesday, January 30, 2008
Yahoo! Announces Poor Profits and Job Cuts
Following a dramatic 23 per cent plunge to £102.8 million in its fourth-quarter profits, Yahoo! has announced its biggest job cuts since the dot-com bubble burst. The search engine giant will cut around 1,000 jobs - which amounts to around 7% of its overall workforce - in an attempt to transform the ailing business.
Yahoo! boss Jerry Yang was keen to justify the job losses. He said: "While we continue to face headwinds this year, we believe that the moves we are making will help us exit 2008 stronger and more competitive…We’re making profound, fundamental changes to virtually all aspects of our business.” It is thought that Mr Yang, who co-founded the company, started to conduct a review of the business during the middle of last year.
Yahoo! makes most of its revenue from advertising, although it has recently suffered due to a decline in advertising spend in the financial, travel and retail sectors. Analysts believe this drop-off in spend will hit Yahoo! harder than rival Google, as many companies find Google’s pay-per-click (PPC) search engine campaigns to be more cost-effective.
In order to boost their advertising revenue, Yahoo! has stated that the focus of its investment this year will be to create a massive network for buying and selling online advertising in order to generate a higher revenue for 2009.
Although Yahoo! was once one of the popular sites on the web, many web users now use Google to perform internet searches, whereas the rise in social networking sites such as Facebook, Bebo and MySpace has made the site less popular with younger web users.
Yahoo!, which currently has around 14,300 employees, has yet to announce which areas of the business will suffer from the job cuts.
Source:
BBC
Guardian
Times
This article is the intellectual property of Pan European Consulting Limited and any unauthorised reprinting or publishing on other websites is an infringement of copyright.