Quoted: on mass layoffs, the latest hit to Yahoo

“Today’s actions are an important next step toward a bold, new Yahoo. … Unfortunately, reaching that goal requires the tough decision to eliminate positions.”

— Yahoo CEO Scott Thompson,  in a statement on the company’s website Wednesday announcing that the long-troubled company is laying off 2,000 employees, or 14 percent of its workforce of more than 14,000 employees. The Associated Press notes that the cuts are the sixth mass layoff in the past four years, during which Yahoo has gone through three CEOs as it has struggled to compete with faster-growing Facebook and Google. Thompson, formerly president of PayPal, became chief executive in January. News of the cuts, which AllThingsD first reported last month, comes amid other big developments involving the Sunnyvale company: Tuesday, Facebook filed a countersuit against Yahoo, which sued it over patent infringement in February. Yahoo also is gearing up for a proxy fight, with activist investor Third Point demanding four seats on the board of directors — which also is undergoing an overhaul. (See Quoted: on Yahoo board turnover and Corporate raiders of the purple ark, the sequel: Will new search for answers at Yahoo yield different result?) In a statement to the press Monday, Yahoo said that it has been “actively and openly soliciting constructive input from its major shareholders,” including the hedge fund led by Daniel Loeb. “Unfortunately, Mr. Loeb rejected our efforts to bring Third Point’s perspective into the board room through the offer of two board seats,” the company said.

 

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  • Marc

    Its so sad watching former giant and at his time one of the favorite places on the struggling so badly

  • Mark Wialbut

    How “corporate”, shrinking to greatness. Really, that’s the best Mr. Thompson can come up with; laying off people? Every time the nimrods that run these companies into the ground by making a long string of bad choices they fall back on the old “let’s lay off our workforce and save money!” About as creative as library paste. You can’t shrink to greatness!

  • sd

    Agreed, Mark. It always amazes me that CxOs get paid what they get paid for again and again trotting out the same old discredited theories. I can understand something along the lines of “After a lot of review, we’ve chosen to stop doing _________” along with a concomitant transfer/loss of people and capital. But the old “Everybody shrink their budgets by 10%” — really, has that ever worked?

    Next week, we’ll explore why it’s impossible to find an H1-B holder qualified for the executive suite.

 
 
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