Yahoo announced in a statement on Thursday that they will be cutting more than 20 per cent of their workforce by the end of 2023, starting with the elimination of 1,000 positions this week.
The company, which was acquired by private equity firm Apollo Global Management in September 2021, had a headcount of around 10,000 employees at the time of acquisition, according to PitchBook data.
However, recent reports by Axios indicate that the current headcount may be closer to 8,000 employees, with more than 1,600 workers set to lose their jobs in the latest round of cuts.
The recent layoffs at Yahoo are part of the company’s plan to simplify its advertising unit’s operations. A spokesperson for the company stated that the strategy for the Yahoo for Business segment failed to meet the company’s expectations in all aspects. These layoffs are a step towards rectifying the situation and ensuring the business segment operates more efficiently.
“Given the new focus of the new Yahoo Advertising group, we will reduce the workforce of the former Yahoo for Business division by nearly 50 per cent by the end of 2023,” a Yahoo spokesperson told CNBC.
Yahoo announced that it will redirect its focus to its long-standing collaboration with Taboola, a leading digital advertising firm, to enhance its advertising services. The partnership between the two companies has existed for 30 years.
“These decisions are never easy, but we believe these changes will simplify and strengthen our advertising business for the long run, while enabling Yahoo to deliver better value to our customers and partners,” the Yahoo spokesperson said.
According to a statement made by a representative of Yahoo to CNBC, the company has announced plans to offer severance packages to its domestic employees who have been impacted by job loss. However, the company has not disclosed the exact amount or specifics of the severance packages being offered.
Severance packages are typically offered by companies to employees who have been laid off or let go due to a reduction in workforce, restructuring, or other reasons. These packages typically include a combination of financial compensation and benefits, such as continued health insurance, unemployment assistance, and outplacement services.
The size and value of the severance package will depend on factors such as the employee’s length of service, position, and company policies. In the case of Yahoo, without specific details on the size or value of the severance packages, it is difficult to determine what the employees can expect to receive.
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