Yahoo has implemented a company-wide hiring freeze despite hundreds of open positions as the first step in a cost-reduction initiative. The company is even contemplating layoffs moving forward, although these are expected to be small and strategic at first, according to sources with knowledge of the situation.

Yahoo will be revealing fourth quarter earnings on Tuesday and although there has been some improvement near the last part of the quarter, overall results are still expected to be weak. Analysts are expecting Yahoo to report revenues of $1.19 billion compared to $1.5 billion last year. As such, newly appointed CEO Scott Thompson certainly has his work cut out for him in order to get Yahoo moving in the right direction again and it appears he is starting at the foundation with finances.

As All Things D reports, additional measures are likely needed in regard to leadership roles. Earlier this week co-founder Jerry Yang resigned from all of his posts at Yahoo to pursue other interests. In addition to Yang’s departure, up to four additional board members are expected to leave their positions soon.

Another battle could be brewing between Yahoo and hedge fund manager Daniel Loeb who owns five percent of the company. Reports say that Loeb had been lobbying for Yang to resign and hopes to see other board members follow in the near future.

As of writing, Yahoo has declined to comment to any of the sources used in this article.