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Yahoo Layoffs Begin, CEO Sends Employees Apologetic Letter
redletterdave writes "As expected, Yahoo began laying off more than 2,000 employees on Wednesday morning — roughly 14 percent of the company's total workforce — in its effort to slim down and pivot its focus in a new direction. The mass layoff marks the sixth time in four years — and under three different CEOs, no less — that Yahoo has dumped employees, but this one will the company's biggest in its 17-year history. Scott Thompson, Yahoo's CEO, sent an apologetic letter to all his employees this morning explaining the changes."
Daniel Loeb, the hedge fund manager who is also one of Yahoo's largest shareholders, has launched a new campaign to shake up Yahoo's board even further since being spurned by the company. Loeb has been trying to persuade Yahoo to elect him, as well as three other alternative candidates, as possible directors. If a truce isn't met between Loeb and Thompson, the dispute will be put to a shareholder vote at Yahoo's annual meeting.
So, this "hedge fund" guy (we called them corporate raiders back in my day. They wore an onion on their belt because that was the stye back then ... oh, yeah.) is going to can a shit load of people, reducing the expenses and boosting profits in the short term. Said "hedge fund" guy will then make a killing on his stock, options, and any warrant positions he has and flies back in his corporate jet to the bank.
In the meantime, Yahoo! not having people to actually, I don't know innovate and restructure the company to actually offer unique products will be gone. So, in the long term, Yahoo! will just be an email outsourcer for the likes of AT&T - a nice low margin commodity market.
Yep, if I were Yang et. al., I'd be unloading as fast as I can and spend the rest of my life being a philanthropist.
Nothing good of this will come of it. It never has and never will. "Hedge fund" guys know only one thing: slash and burn.
... laying off people allows you to "get stuff done" and "be nimble". To me a company with excess workforce is a lot more likely to be nimble (easy to create ad-hoc teams to pursue new products/things) than a company at capacity where everybody is already fully tasked (where if you have a new project you HAVE to abandon some older project whether or not it makes sense to do so).
The nimbleness of a company is more of a function of how it's managed than of its size, but of course it's a lot easier to spin layoffs by pretending that a smaller company is somehow better performing than a larger one (if that was the case why would companies ever hire? it'd be much simpler to just remain "nimble" by staying small).
-- the cake is a lie