Internet giant Yahoo is doing a bit of damage control, following reports citing anonymous sources that claimed the company was getting ready to lay off as much as 20 percent of its workforce in a move to improve its revenue profile. In a statement, Yahoo characterized the report as “misleading and inaccurate,” but stopped short of saying it’s not going to be making any layoffs. Instead, Yahoo said it is “evaluating expenses to align with the company’s financial goals.”
Initial reports of 20 percent layoffs came in the often controversial technology blog TechCrunch, which has recently been acquired by AOL. (Unconfirmed reports have AOL manuevering to finance a Yahoo takeover.) The Wall Street Journal’s AllThingsD blog later reported Yahoo is planning layoffs at a considerably smaller scale.
Yahoo continues to operate some of the most highly-trafficked Web destinations on the planet, and Yahoo’s search service is still second (albeit a distant second) to Google in both the U.S. and worldwide search market. However, despite Yahoo’s visibility—and high profile in online display advertising—Yahoo CEO Carol Bartz has been under increasing pressure to show revenue growth and pump up Yahoo’s stagnant stock price. Although Yahoo has managed to cut costs (and generate revenue) from handing back-end search operations over to Microsoft’s Bing, the company is still struggling to compete with the Google’s and Facebooks of the world, and Yahoo has also seen a spate of executives leave the company in recent months. The situation has led to rumors of private equity firms mulling a takeover of the company—with the once-mighty AOL also in the mix.
Yahoo currently has about 14,000 employees. Yahoo laid off about 2,500 employees at the end of Jerry Yang’s tenure as CEO, following the disruption of Microsoft’s abortive hostile takeover attempt of the company. More recently, Yahoo has also severed ties with employees over the sale and shutdown of services like GeoCities and HotJobs, and reports have had the company occasionally laying off small numbers of employees and engineers in various product groups, including Flickr.