Does Yahoo! (yahoo) Will you lay off about 20% of the company’s workforce, which is about 1,600 people? The Axios website claims that the company’s CEO confirmed the details. According to the report, the move is part of a “reorganization” of the company’s advertising department. According to the report, more than 50% of Yahoo’s advertising department employees – more than 1,600 people – will go home .
Also according to the report, Yahoo CEO Jim Lanzon confirmed the details and said that the layoffs are not related to “financial challenges, but to strategic changes in the advertising unit” of the company – because it is “not profitable” adding that the layoffs will be “very beneficial to Yahoo’s profitability In general,” and that it would allow the company to “go wild” and invest more in other parts of its business that are profitable. “This has been a long-standing problem that affects every variation of this company… a problem that had to be solved eventually,” he said.
Yahoo as a whole is considered a profitable company. In the top line, it registers revenues of about 8 billion dollars.
According to Axios, about 1,000 positions will now be eliminated, representing 12% of the total planned cuts at Yahoo. The remaining 8% (or more) will occur in the second half of the year. While the CEO said he could not provide the exact number of expected future layoffs, he confirmed that the total number of layoffs will amount to more than 50% of the current staff of the advertising unit, which is more than 20% of Yahoo’s entire workforce.
As part of the changes, Yahoo is expected to shut down part of its advertising business called its SSP, or supply-side platform, which helps digital publishers sell automated ads against their content. It will also shut down its native advertising platform, called Gemini.
At the same time, Yahoo wants to leverage its new partnership with the Israeli Taboola, a partnership announced last November, when in exchange for the partnership Yahoo received 25% of Taboola’s shares. This is a 30-year agreement, which for Taboola is of course a great achievement. Collaborate to increase 8x the number of advertisers competing for ad placements on Yahoo properties.
Also according to the report, Yahoo is closing the SSP business rather than selling it, in part because it didn’t want to be locked into a post-sale agreement where it would be forced to use its SSP exclusively.
The telecommunications giant Verizon bought AOL for $4.4 billion in 2015, and Yahoo two years later for $4.5 billion and then sold them a year and a half ago to private equity fund Apollo for $5 billion as well as its digital advertising business (4.25 billion in cash). , so from Verizon’s point of view it was a losing transaction.
Verizon acquired the companies to “bring life into dormant brands that have lost users over the years,” but Yahoo remains a base that includes hundreds of millions of accounts. She wanted to make Yahoo much more popular and eventually gave up.
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