Yahoo to Consider 'Strategic Alternatives' for Internet Biz

[cdmagurus.com]

Yahoo has announced plans to explore strategic options for its internet business, which has struggled to turn a profit in recent years. The company said it plans to improve consumer and advertiser product quality while also increasing the number of daily users. It is also looking to chop expenses, and will do so by reducing its workforce by 15%, or about 1,600 employees. Yahoo believes it can trim $400 in expenses by the end of the year. Importantly, Yahoo said it will "explore non-strategic asset divestitures that, if consummated, could generate in excess of $1 billion in cash." Yahoo said it is committed to its Yahoo Mail, Search, and Tumblr businesses, as well as its News, Sports, Finance, and Lifestyle verticals in select markets. Yahoo did not mention Flickr, its photo-sharing and -storing service, in its restructuring plans and its fate is unclear. Yahoo said it will "invest in features and experiences that engage users as both consumers and creators of content, encouraging them to do more with, and therefore spend more time on, the Yahoo network." Yahoo believes its mobile search business has the most potential to improve growth and financial performance. Yahoo did not explicitly put its internet business up for sale, but such a move is likely on the table with whatever other options are being considered. Verizon and private equity firms have expressed interest in acquiring some or all of Yahoo's internet assets, but none has made a formal offer.


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