Thursday, 23 October 2008

Yahoo! announces cut-backs

Yahoo! is still struggling in the search market and within the weakening US economy as net profits in the third quarter of 2008 are reported to be at US$54m, down from US$151 a year before. This was from a total revenue of $1.78bn, which was just 1% up on the corresponding period in 2007.

As a result, about 10% of Yahoo!'s global workforce (about 1,400 people) will be laid off. This news has, not surprisingly, received wide media coverage - including by the Sydney Morning Herald - and comes after the announcement earlier in the year by Yahoo! that an initial 1,000 jobs was also to be cut.

The deepening troubles at Yahoo! also come just over a week after Google reported their third-quarter results which exceeded analyst expectations - revenues were $5.54 billion, up 31% compared to the third quarter of 2007 and an increase of 3% compared to the second quarter of 2008. Profits jumped 26% to US$1.35bn, up from US$1.07bn in the 2007 quarter, which indicates that the company is continuing to grow despite the wider economic problems in the US and worldwide.

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