Yahoo to layoff 1500 as Profit falls 64 percent, gets sued by AA
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As we reported of layoff season plaguing the valley, Yahoo announced removing 10% of its 14,300 workforce as its profits fall 64 percent for 3rd quarter. The layoffs will happen over the next two months. Yahoo stock went down 6% to close at 12.07 but in the after hours trading after the announcement, stock is up 5.5% and is trading at 12.68 at the moment.
In another bad news for Yahoo, American Airlines is suing Yahoo over trademark infringement of its keywords. The airline complains American Airlines trademark keywords such as AAdvantage, the name of its frequent-flier program, when searched on Yahoo can be directed to competitors who pay Yahoo for the traffic. American Airlines have previously settled a similar lawsuit against Google.
The layoffs at Yahoo, representing at least 1,500 jobs, are part of a plan to save more than $400 million annually as the slumping economy crimps ad spending. With financial firms and automakers reducing costs, U.S. Web ad sales growth may fall below 20 percent this year for the first time since 2002.
In search for Partnership, Yahoo would be pleased to hear that Google had agreed to keep talking with the U.S. Justice Department about its proposed online advertising deal with Yahoo. Under the deal announced in June, Yahoo would turn over some of its online advertising space for Google to sell. Google has announced earlier that the company would move forward with the Yahoo search partnership with or without approval from antitrust reviewers at the Justice Department.
[Update] The number of layoffs have been revised to 1500 instead of 1400.
