Updated at 5:30 p.m. PST with report on Yahoo board meeting.
Planned job cuts at Yahoo are expected to come on Tuesday, with managers possibly finding out Saturday who is on the list, according to sources inside the company.
The layoffs come as Yahoo executives and board members discuss Microsoft's bid for the company. So far, Yahoo has not acted on the offer. Chief Executive Jerry Yang has told staffers that executives would take their time evaluating the proposal. However, Microsoft's share price has dropped since the offer was made a week ago, lowering the value of the deal from $44.6 billion to about $41.8 billion.
Meanwhile, The Wall Street Journal reports that Yahoo directors on Friday discussed taking Google up on a reported search advertising outsourcing pact to thwart the Microsoft bid or figuring out how to get Microsoft to sweeten the bid. The next scheduled meeting is Wednesday.
It's unclear how layoffs would play into the merger discussions; whether a leaner Yahoo would give Microsoft incentive to sweeten the bid.
they would be laying off 1,000 people in February, but did not disclose which areas would be cut.
CNET News.com's Stefanie Olsen contributed to this report.