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Layoffs are always hard for a company because they have to get rid of human beings who have been working for them to make a career and a living. There are usually only a few reasons why a company would lay workers off. Usually it is either because the employee hasn’t been producing at the standards set by the employer or their yearly or quarterly budget deemed it necessary to cut their losses and begin being profitable again. Another reason could be that the company just isn’t doing very well, and they are starting to let go of certain aspects of the company to restart from the bottom up or sell the company all together. Yahoo seems to be in the thick of a layoff, here’s what is happening:

What’s going on?

Yahoo has laid off employees mostly in the Music and TV department. These employees are mostly executives and editors. Earlier this month, Yahoo said they were planning on laying off close to 15% of their employees. This was largely in part because they were trying to get rid of parts of the company that were no longer relevant or creating business. It also seems that they were looking at ways to come back from their current downfall or be forced to sell.

After hiring a new CEO in 2012, the company has had a hard time staying in the thick of the competition and in many ways, tried to reinvent itself in many ways. Now, after laying off a good size of the company, Yahoo will try to reinvent itself one last time. Part of the downfall of the last reinvention was the failed attempts at startups who Yahoo believed would generate revenue for the company. Those attempts obviously backfired and Yahoo was left struggling to figure out what to do next. Now, they will be focusing on being selective with their content on their website to bring in a tighter nit audience. It seems as if they are looking to get a little smaller and be a niche for readers on their website.

What will happen?

It is hard to say what exactly can come from this. Yahoo has tried to reinvent itself many times and nothing positive has come from it. Their stock prices are down under $30 a share compared to Google’s $700 and growing. Unless Yahoo can find something that sets them apart from other search engines or sources for news and articles, it may be a tough hole to dig out of. Maybe these layoffs can help them put a little more money into innovation and either develop something for the market that can compete with other companies, or create something completely new. If something doesn’t happen soon, Yahoo may be forced to sell at probably one of their lowest if not the lowest point in history.

The answer is always the bottom line in big companies. Revenue is king, and low revenue, means a smaller bottom line, something big companies like Yahoo can’t afford to lack.

 

Posted in: News.
Last Modified: May 19, 2016

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