The company will also close five worldwide offices and explore “strategic alternatives” in an effort to cut expenses and streamline operations.
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Yahoo’s revenue has been shrinking through most of Ms Mayer’s reign, even though she has spent more than 3 billion dollars buying more than 40 companies, while bringing in new talent and developing mobile applications and other services created to attract more traffic and advertisers.
The announcement is the strongest sign yet that Chief Executive Marissa Mayer may be willing to sell the struggling Internet business of Yahoo, which was a web pioneer in the 1990s but has since been eclipsed by Alphabet’s Google and Facebook in the battle for online advertisers.
By the end of 2016, the company plans to have about 9,000 employees and fewer than 1,000 contractors. These job cuts are part of a broader series of moves that hope to improve Yahoo’s business agility, which also include the removal of several services that Mayer feels are not worth the time and money anymore.
On Tuesday, Mayer said, the Sunnyvale, California based company plans to streamlines its business at the same time focusing mainly on mobile and video ad products.
Yahoo Inc said on Tuesday it was exploring strategic alternatives in addition to the continued pursuit of the reverse spin-off of its Internet business.
Specifically, Yahoo said it will focus most heavily on search, mail, Tumblr, and news – sports, finance and lifestyle verticals – in key markets.
She said it makes sense for Yahoo to have a “more reasoned perspective” in terms of how quickly it can advance its plan.
Maynard Webb, the chairman of Yahoo’s board, also signaled that the company might sell itself to the right bidder. “Separating our Alibaba stake from our operating business continues to be a primary focus, and our most direct path to value maximization”. With its growth prospects dwindling, Yahoo will likely announce significant cost-cutting across the company.
The company said that for advertising, mobile search is the biggest opportunity, and Yahoo will shift resources in this area to a more “forward-leaning” mobile agenda.
Yahoo’s adjusted quarterly revenue tumbled 15% to $1 billion after deducting fees paid to partner websites, as it struggles to keep its share of online search and display advertising.
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Revenue during the quarter before Mayer took over was $1.1 billion, not much below what it was last quarter.
