Yahoo reportedly prepping layoffs

The goal: cut spending and then invest in businesses that can generate revenue growth. The problem? Yahoo still needs a growth plan.

Yahoo and Scott Thompson need a plan.
Scott Thompson needs a plan.

Yahoo is planning layoffs that could number in the thousands, according to AllThingsD.

Kara Swisher reports that new CEO Scott Thompson is planning to lay off workers in public relations, marketing, research, and "marginal businesses."

The goal for Yahoo is relatively simple. Cut spending in some areas and then aim that investment at businesses that can generate revenue growth. Swisher noted that Thompson is pushing for quick changes that can appease shareholders.

Indeed, Thompson's cuts---if as deep as indicated---will be a dramatic move for Yahoo. However, Thompson needs to outline those key growth objectives shortly after those deep cuts.

Yahoo needs a new act and Thompson has to outline the plan.

On Yahoo's fourth-quarter conference call, Thompson indicated that change was coming, but details were sparse. Thompson talked about the balance between media and technology.

Thompson said:

We will focus on generating real, sustainable growth and value creation. I feel great about all that, but I'm also very clear that we have a lot of work to do. It's still early, and I don't intend to lay out any detailed strategy until I fully assess our direction...We'll prioritize the most important things, move aggressively, and we'll move fast. We have to get great, innovative products that matter into the market, absorb feedback quickly from our customers and grab those products constantly.

The layoffs, which may come by the end of the month, appear to be the first step in setting up the structure Thompson wants to move quickly.

An earlier version of this story was published at ZDNet's Between the Lines under the headline "Yahoo layoffs on deck: Thompson eyes analytics bet?"

About the author

    Larry Dignan is editor in chief of ZDNet and editorial director of CNET's TechRepublic. He has covered the technology and financial-services industries since 1995.


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