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Yahoo to Lay Off 20% of Workforce
Another tech company has announced major layoffs – this time in a bid to restructure.
Yahoo has announced lay offs of more than 20% of its workforce, with plans to restructure their advertising department.
The company has about 8,600 current employees, and lay offs should go into effect by the end of the week.
About 12% of staff – around 1000 employees – will be cut by the end of this week, with a further 8% cut in the coming six months.
The layoffs have little to do with concerns over revenue – Yahoo is earning around $8 billion a year.
Rather, the cuts are part of a major restructuring of their advertising department.
Yahoo recently took a 25% stake in Taboola, an advertising network, as their new advertising partner.
According to CEO Jim Lanzone, the move will increase the competition for ad placements by eight-fold.
The restructuring will see Yahoo investing in their demand-side platform (DSP), which means shutting down native advertising platforms like their supply-side platform (SSP), Gemini.
Renamed as Yahoo Advertising, the DSP will focus on deals with larger companies to increase ad revenue.
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Though they are firing about 50% of their advertising staff, Lanzone said the company plans to hire more people to grow their DSP.
The shift could be so Yahoo’s advertising models does not directly compete with giants like Google and Facebook, by aiming to work with premium accounts.
Yahoo is just the latest massive tech conglomerate to announce major layoffs, following the likes Microsoft, Google, Meta, Dell, IBM, PayPal, NetApp, Spotify, Twitter and Zoom.
Over-hiring during the pandemic, falling demand, and a shift in priorities were often cited reasons for the major layoffs seen across big tech.
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