New Yahoo CEO Means More Rounds Of Cost Cuts?

Henry Blodget | November 17, 2008 9:01 PM

jerryyang7.jpgWith Jerry now officially a lame duck, what is likely to happen to the mass firings and other cost cuts Yahoo has already announced? Will they happen as planned? Will they be larger than 1500 Yahoos? Will they be put on hold until Jerry's successor takes over?

We have no inside info, but we suspect the already announced cuts will be carried out as planned. Yahoo needs to reduce costs, and by almost any measure its workforce is too large.

Unfortunately the arrival of a new CEO could easily mean the ordering of another round of cost reductions shortly following the first. New CEOs often like to push reset by drastically cutting costs, and Yahoo has a lot to cut. As we've discussed, we think Yahoo would be sized appropriately if it cut its workforce by 3000, or more than twice the cuts that have already been announced. We would not be surprised if a new CEO came to the same conclusion.

See Also:
Jerry Out
Will Jerry's Departure Bring Microsoft Back To The Table?
What About The Yahoo-AOL Deal?

 

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12 Comments

Mr. Magoo said:
You don't seem to ever base anything you write on any actual information. So much speculation, so few facts, Henry.

Last month, someone had to tell you that Yahoo always has an all-hands meeting on the day after the earnings call. You seemed to know that, and assumed they were calling the all-hands to tell people about the cuts.



Pete said:
Everyone knows there will be massive layoffs because Yahoo is full of dead weight, which company founders tend to be very reluctant to cut. This is why the company hasn't been profitable in ages.
Yo ho ho said:
Ummmm. Yahoo is insanely profitable by most industry standards. They just aren't as profitable as Google and losing share badly. If you want to talk about poor profits... check out MSN.
Sean said:
"This is why the company hasn't been profitable in ages"

Pete - just curious where you get your data for that statement? Last time I looked I didn't see any quarters in the red for Yahoo!...maybe I am looking in the wrong place?
ardesh (URL) said:
Follow Yahoo on Line Spout. http://www.linespout.com?q=yahoo
Migukin (URL) said:
A Facebook / Yahoo merger would be pretty cool. Facebook has all this unlocked potential simply because they seem unwilling to branch out into stuff that would actually help them make money.

In the end, though, I suspect M$ is going to gobble up Yahoo...and maybe Facebook? When will Google intergrate Orkut into its offerings more? If Google were to buy AOL then merge it with Orkut, that would rock.
YahooEmployee said:
Today is one of the GREATEST DAYS in Yahoo history.

The next great days will come when DECKER and her cronies are forced out as well.

Now us Yahoos can get some real work done and make progress. Like the phoenix from the ashes, such is Yahoo.

VIVA YAHOO!
Paladin said:
The quotation from Warren Buffett sums it up best. "A good managerial record is more a function of which boat you get into rather than how effectively you row." The problem with a lot of high-tech ventures is the quality of the ideas are not matched by the quality of management. To abandon ship without FIRST naming your SUCCESSOR should prompt the BOARD OF DIRECTORS TO FOREGO COMPENSATION AND BONUSES WHILE THEY PACK THEIR PENCILS!!! Either there is genius behind this insanity or lunitics are truly running the show. Did someone say, "send in the clowns?" I think we positive proof where they are. Bonne Chance!!!
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