AOL CEO Tim Armstrong in a recent internal memo to employees announced a company-wide restructuring that'll impact a small percentage of its global workforce.
In the memo, Armstrong said each area within the company was reviewed through the lens of their strategy and while some areas will be trimmed down for 2017, others will add headcount and resources.
A source familiar with the situation tells Reuters that AOL will let go about five percent of its workforce, or roughly 500 people. Corporate units such as human resources, marketing and finance will bear the brunt of the cuts.
Armstrong said in the memo that deals they've done over the past 12 months have added more than 1,500 new people to the company. As they've settled into the changes, he added, there are a number of areas that require consolidation in order to improve operations and limit the amount of hand-offs in their business processes.
Verizon last year purchased AOL for $4.4 billion, electing at the time to continue to operate it as a subsidiary. Earlier this year, Verizon agreed to buy fellow Internet pioneer Yahoo for $4.83 billion. Yahoo not long after, confirmed that it had suffered a massive data breach in 2014 affecting at least 500 million users. The breach could potentially provide Verizon with a way out of the deal, especially considering the fact that some at Yahoo knew about the hack shortly after it happened.
Moving forward, Armstrong said AOL will be focused on two simple business units - media (including communications and search) and platforms - with data, mobile and video being the key growth drivers.