Yahoo is reducing its work force by 4 percent and as it hands out 600 layoff notices for the holidays.
The job cuts announced Tuesday follow weeks of speculation about whether a long-running financial funk would spur Yahoo to trim its payroll before the new year.
This marks the fourth time in three years that Yahoo Inc. has resorted to mass firings to boost its earnings.
The cost-cutting strategy so far hasn’t been enough to lift its stock price. Yahoo shares closed Tuesday at $16.63, compared with $17.30 at end of September 2008 when Yahoo’s payroll peaked at 15,200 employees. It had 14,100 employees before the latest cuts.
Yahoo’s struggles have raised questions about whether CEO Carol Bartz might lose her job before her four-year contract expires in January 2013.
These reductions are expected to be concentrated in Yahoo’s U.S. products group, which already has been undergoing an overhaul since Bartz hired former Microsoft Corp. executive Blake Irving to run the division last spring.
News of the looming layoffs was first reported last month by two popular technology blogs, TechCrunch and All Things Digital.
Yahoo’s feeble financial growth, stagnant stock price and recent management defections have raised questions about whether Bartz herself might be shown the door before her contract expires in January 2013.
The company’s revenue had edged up by less than 2 percent to $4.8 billion through the first nine months of the year, reflecting the difficulty Yahoo has had selling ads while other Internet companies such as Google Inc. and Facebook are thriving.
Google’s revenue climbed 23 percent to nearly $21 billion through the first nine months of the year. Privately held Facebook doesn’t disclose its results but it is growing so fast that it had to move into larger headquarters earlier this year.
Yahoo’s stock price fell 31 cents to close Monday at $16.70, a few cents below where it ended last year. Meanwhile, the technology-driven Nasdaq composite index has risen by 16 percent so far this year.
The malaise has spurred speculation that opportunistic buyout firms might put together a takeover bid for Yahoo, possibly in partnership with another embattled Internet icon, AOL Inc.
Bartz, 62, has repeatedly insisted Yahoo, which is based in Sunnyvale, is heading in the right direction, although she has cautioned it might be another year or two before there’s a significant improvement in the company’s financial results.
