Yahoo to lay off 2,000 employees as part of restructuring plan

Nickalas Tabbert

 Yahoo is expected to lay off 2,000 employees as new CEO Scott Thompson begins restructuring the struggling Internet company.

The cuts announced Wednesday represent about 14 percent of the 14,100 workers employed by the Sunnyvale, California company, CBC News said.

Yahoo estimated it will save about $375 million annually after the layoffs are completed later this year.  It will absorb a pre-tax charge of $125 million to $145 million to account for severance payments.

The cuts are part of an overhaul aimed at focusing on what Thompson believes are Yahoo's strengths while also trying to address its weaknesses in the increasingly important mobile computing market, CBC News said.

"We are intensifying our efforts on our core businesses and redeploying resources to our most urgent priorities," Thompson said in a statement.  "Our goal is to get back to our core purpose – putting our users and advertisers first – and we are moving aggressively to achieve that goal."

Thompson said he would elaborate on his plans April 17 when Yahoo is scheduled to release its first-quarter results.

This is Yahoo's sixth mass layoff in the past four years under three different CEOs.  Wednesday's announcement will be the worst yet, eclipsing a cost-cutting spree that laid off 1,500 workers in late 2008 as Yahoo tried to cope with the Great Recession, CBC News said.

Yahoo has had other issues as of late.  In February, four longtime board members, including chairman Roy Bostock, announced they would not seek re-election, CNN said.

In March, Yahoo filed a lawsuit against Facebook, alleging the social media site infringed on 10 of Yahoo's patents related to advertising, privacy, customization, messaging and social networking.

Facebook called the lawsuit "puzzling," while outside critics said the move was "pathetic" and "desperate." 

Facebook denied the claims and retaliated with a patent-infringement lawsuit of its own this week, CBC News said.