Yahoo profit plunges, layoffs announcedOctober 22nd, 2008 - 6:59 am ICT by IANS
San Francisco, Oct 22 (DPA) Troubled internet giant Yahoo saw quarterly profits plunge 64 percent and announced Tuesday that it would cut 10 percent of its estimated 14,300 staff to help control costs.The internet pioneer reported net income of $54 million, or 4 cents a share, compared to $151 million, or 11 cents a share, in the same period last year.
The company said revenue rose slightly to $1.78 billion compared to $1.76 billion in the year-ago quarter. The results were in line with analysts’ expectations, while the layoffs had also been widely reported in recent days.
The company said the job cuts were designed to help it reduce annual costs of $3.9 billion by more than $400 million.
“As economic conditions and online advertising softened in the third quarter, we remained highly focused on our 2008 strategy to invest in initiatives that enhance not only our long-term competitiveness, but also our ability to deliver for users and advertisers,” company founder and chief executive Jerry Yang said in a statement.
“We have been disciplined about balancing investments with cost management all year, and have now set in motion initiatives to reduce costs and enhance productivity,” he said.
The earnings drop heaped even more pressure on Yang, who earlier this year rejected a takeover of the company by Microsoft that valued Yahoo at about $33 a share. Since then the share price has plummeted to about $12, and the company’s plan to form an advertising alliance with Google is facing strong regulatory questioning.