Yahoo to cut 1,400 jobs

Yahoo has announced plans to lay off at least 10 per cent of its workforce, some 1,400 employees, as the weak economy cut deeply into third-quarter profits at the struggling Web company.

Yahoo said net profit for the third-quarter of the year was $54 million, or four cents per share, down from $151 million and 11 cents per share during the same period of 2007.

It said revenues were $1.78 billion in the third-quarter, an increase of only one per cent over the $1.76 billion in the same period last year.

Yahoo has been losing ground on the Internet to companies such as Google, MySpace and Facebook and the economic slowdown has hurt the firm particularly hard as advertisers cut back on spending.

 

"An increasingly challenging economic climate and softening advertising demand contributed to revenues this quarter coming in at the low end of our outlook range," said Yahoo chief financial officer Blake Jorgensen.

"While we are disappointed with our results, we're pleased that we continue to benefit from the aggressive cost management efforts we have pursued during the year," he said in a statement.

"We have the balance sheet strength, liquidity, and free cash flow we need to continue to make progress on our core strategies as we address this slowdown," Jorgensen added.

The Sunnyvale, California-based Internet company said it would carry out its second round of layoffs this year in a bid to cut costs.

"Yahoo expects to reduce its global workforce by at least 10 per cent during the fourth quarter of 2008," the company said yesterday, reducing its annual expenses by some $400 million.