News coming from both The New York Times and The Wall Street Journal tell us that Yahoo will be laying off hundreds of people, and it’s going to happen soon. After taking a look at the last couple of years over at Yahoo, it’s completely understandable why these layoffs are imminent and necessary. Yahoo stock has taken a nose dive down and has declined around 50 percent since the end of 2005. Then add Google into the picture and how they’ve completely dominated over Yahoo in multiple ways over the last year or two and the picture is clear. Yahoo had to do something.
So how many jobs is Yahoo expected to cut? Well, that number isn’t clear quite yet. We won’t know for sure what will happen until at least January 27th, the date of the next Yahoo board meeting. Silicon Alley Insider said Yahoo had made a list of 1500 to 2500 jobs that could be eliminated, but that it shouldn’t be quite that high. The low end of that range, around 1500 people, would equal about 10 percent of their work force. No matter how many people they point towards the door in the next coming weeks, their profitability will increase as a result. But will it be enough to make a real difference and give their stock a needed boost?
While Yahoo hasn’t confirmed anything specific, a company spokeswoman, Diana Wong spoke to the New York Times and said: “Yahoo plans to invest in some areas, reduce emphasis in others, and eliminate some areas of the business that don’t support the company’s priorities. Yahoo continues to attract and hire talent against the company’s key initiatives to create long-term stockholder value.”
I’m sure many of you are wondering what’s going to happen to Yahoo given the layoffs, and some of you may have your own predictions. While people around the web have said this is a sign that Yahoo is going down the tubes, I don’t think that’s likely to happen at all. Look how many people use Yahoo! Mail, they’re one of the leaders in webmail! Look at how many people use Yahoo search, once again, it’s a lot. They’re not going anywhere at this point, even if they cut 10 or 20 percent of their workforce.