Yahoo to cut jobs, prepares for rougher timesBy Julio Franco
Yahoo is expected to announce further job layoffs this week as it prepares for a tough road ahead amidst a climate of financial recession and expenditure cutting that could severely impact online advertising revenues. The exact number of layoffs are still unknown, but at least a thousand from the 14,300-employee company is rumored.
The Internet's second largest search engine will also be announcing its third-quarter earnings on Tuesday, which will hardly mirror the surprising results from main competitor Google last week whose Q3 earnings raised 31 percent year over year. Yahoo's advertising revenues are considered more vulnerable to the financial crisis since a large share of it comes from display advertising, versus Google's dominant performance-based per click ads.
It's been a harsh year for Yahoo, that despite of managing to turn in a healthy profit has failed to raise as a true contender to Google, and hence receiving the disapproval from analysts and investors alike. Just last May Microsoft rescinded its offer to buy Yahoo for $47.5 billion, a sizable premium over today's company market cap of $17.88 billion. Last Friday Yahoo's shares closed at $12.90.