Yahoo to lay off 20% of its staff, or 1,600 people • TechCrunch

Yahoo to lay off 20% of its staff, or 1,600 people • TechCrunch

Yahoo is laying off 20% of its staff, affecting 1,600 employees in its ad tech business. Yahoo is TechCrunch’s parent company.

Employees were warned Thursday that 12% of the company (1,000 employees) would be laid off before the end of the day. In six months, an additional 8% – or 600 people – will be made redundant. These cuts will impact about half of Yahoo’s ad tech business.

In a interview with Axios, Yahoo CEO Jim Lanzone said the layoffs are not the result of economic problems, but rather intentional changes aimed at bolstering Yahoo for Business’ unprofitable advertising unit. Overall, Yahoo is profitable, earning around $8 billion in annual income.

In November, Yahoo took almost 25% of capital in the Taboola advertising network, which is now the company’s native advertising partner under a 30-year commercial agreement. Lanzone told Axios that these changes will allow Yahoo to increase competition for ad placements eightfold — but as a result of this transition, Yahoo will shut down native ad platforms like Gemini and its supply-side platform (SSP). Yahoo will also focus on its demand-side platform (DSP), which will be renamed Yahoo Advertising. This division will focus on transactions with Fortune 500 companies.

“Over several years, our ad business strategy has been to compete in the ad tech industry by offering a ‘unified stack’ consisting of our demand-side platform (DSP), supply-side platform (SSP), and our native platforms,” ​​a Yahoo spokesperson said. said in a statement to TechCrunch. “Despite many years of effort and investment, this strategy was not profitable and struggled to meet our high standards across the stack.”

In 2021, private equity firm Apollo Global Management completed its Acquisition of Yahoo for 5 billion dollarsformerly known as Verizon Media Group.

Updated, 2/9/23, 3:05 p.m. ET with comment from Yahoo.

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