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Yahoo To Fire Another 15% As Mayer Attempts To Hang On (theguardian.com)

Posted by timothy on from the taking-lumps dept.

New submitter xxxJonBoyxxx writes: Yahoo chief executive Marissa Mayer has announced plans to cut the company's workforce by 15% and close five foreign offices by the end of 2016 after announcing a $4.4bn loss. Yahoo shares have fallen 33% over the past year, including a 17% drop in the last three months. Its shares fell again in after-hours trading after Mayer announced her plan. Yahoo expects its workforce to be down to 9,000 and have fewer than 1,000 contractors by end of 2016. About a third of Yahoo's workforce has left either voluntarily or involuntarily over the last year. And the cuts may just be starting: one activist investor (SpringOwl) says the total number of employees should be closer to 3,000 for a company with its revenue.

6 of 218 comments (clear)

  1. If she really wanted to rescue the company... by Viol8 · · Score: 5, Insightful

    ... she'd fire herself.

    1. Re:If she really wanted to rescue the company... by jfdavis668 · · Score: 5, Insightful

      The company was going in the wrong direction before she was even hired. They hired her as a gamble to make a big change to save the company. It didn't work. Going back to the way it was is stupid, it wasn't working before. The only things worth keeping are its overseas holdings. The core company is worthless. Firing her and hiring a replacement won't change that. They took a big gamble and lost. There is no going back.

    2. Re:If she really wanted to rescue the company... by Gojira+Shipi-Taro · · Score: 5, Funny

      Don't be silly. How could she fulfill her mission of making Carly Fiorina look competent by comparison if she gave up now?

      --
      "Oh my God. This is terrible. This is the end of my Presidency. I'm fucked."; ~ Donald J. Trump
    3. Re:If she really wanted to rescue the company... by Trailer+Trash · · Score: 5, Interesting

      The company was going in the wrong direction before she was even hired. They hired her as a gamble to make a big change to save the company. It didn't work. Going back to the way it was is stupid, it wasn't working before. The only things worth keeping are its overseas holdings. The core company is worthless. Firing her and hiring a replacement won't change that. They took a big gamble and lost. There is no going back.

      I would argue that the core company isn't "worthless", it's just worth far less than it used to be. Plenty of people still go to yahoo.com, use it for email, news, etc. i still go to the financial part if I want to find out more about a company as I've found their tools to be pretty decent for aggregating everything of interest about a public company.

      That said I tend to agree with the investor who says that they should be around 3000 staff members. My question to him is also "what is the proper CEO compensation for a company with this revenue?" My guess is that it's not even in the ballpark of what Mayer is getting.

      The bottom line is that there's still a business there, probably not any real growth potential. So the proper thing to do is downsize, concentrate on the core(s) that are profitable and be really good at those areas where you're known to be really good.

      That's odd advice in the internet world where everybody wants perpetual growth, but there are plenty of stores in my town here that aren't looking to grow but rather provide steady income until retirement. We have to be realistic and understand that that particular model is also relevant on the internet.

      --
      Do you have ESP?
  2. We are infected with MBA-think by bigdavex · · Score: 5, Interesting

    And the cuts may just be starting: one activist investor (SpringOwl) says the total number of employees should be closer to 3,000 for a company with its revenue.

    Why would anyone think there's a constant proper relationship between revenue and the number of employees across all businesses? I mean, let's just skip right over that employees are paid different amounts, businesses take different amount of human effort to create the wealth, the market will support different prices for different services, and the business will have a different amounts necessary to pay their vendors and capital requirements.

    Suppose I have a farm business. One year I decide to spin-off the part of the company that picks the tomatoes. The previous company suddenly has much more revenue per employee. Should it go out and hire more people? The tomato picking company has little revenue per employee. Should the tomato picking company fire a bunch of people. Of course not.

    --
    -Dave
  3. elite workers paradise by goombah99 · · Score: 5, Funny

    with 50% of the staff fired now, they have removed the bottom 50% of performers. So those remaining must be deleriously happy to be working with such elite peers. their productivity must be skyrocketing now that all the deadwood and even mediocre but dilligent workers are gone.

    --
    Some drink at the fountain of knowledge. Others just gargle.