Yahoo Inc said on Tuesday it would consider “strategic alternatives” for its core Internet business and cut about 15 percent of its workforce, even as it continues with its plan to renew the business and spin off.
The announcement is the strongest signal that the board and chief executive Marissa Mayer may be willing to sell the struggling internet business – essentially web sites, email and online search – under growing pressure of impatient shareholders.
In an interview with Reuters, Mayer said the company will entertain offers as they come but its first priority is the restructuring plan.
If you receive an offer this year, it was unlikely that the transaction will be completed before the timeline of 9-12 months allowed for the division, he said.
“Obviously we would like to participate but I think the only thing we’re trying to do is set the expectations of our shareholders in terms of complexity,” Mayer said.
The planned restructuring announced Tuesday includes closing offices in five locations, a paring down of its products, changing more resources to mobile search, and the sale of some non-strategic as real estate assets and patents.
Investors were not immediately impressed, sending Yahoo shares fell 1.2 percent after hours. They have now fallen 36 percent in the last 12 months.
“We believe that the strategic plan does not fully address the core issues that have destroyed shareholder value – misallocation of capital, strategic partnerships bad, out of control spending and a swollen hand work,” said SpringOwl Management in New York assets, a shareholder who has called for changes in the company.
Proceeds from the pioneering band peaked in 2008 and, although some of the most widely read websites in the world still runs, has been unable to keep pace with the alphabet Google Inc and Facebook Inc in the battle for advertisers line.
In the rejig of its business, which will focus on three major platforms consumer, Search, Email and Tumblr, and four “strengths” of digital content in the form of news, sports, finance and lifestyle.
The changes are designed to increase revenues from mobile advertising, video, native and social 8 percent to $ 1.8 billion and reduce operating costs by $ 400 million this year. It also aims to generate $ 1 billion to $ 3 billion in asset sales.
Mayer dismissed accusations of overspending, saying a report of a $ 7 million holiday party of Yahoo was exaggerated by a factor of three.
adjusted quarterly revenues of Yahoo fell 15 percent $ 1 billion after deducting fees paid to partner websites, as it strives to maintain its share of online search and display advertising.
Mayer suggested in December that Yahoo spin off its main business after it abandoned efforts to sell its stake in Alibaba.
In the interview Tuesday, Mayer said the company intends to their participation in the Yahoo Japan group’s core business, but would be open to split it off depending on market feedback.
The company reported a loss of $ 4.43 billion, or $ 4.70 per share, in the quarter, due to a reduction to account for the lower value of some units. That compares with net income of $ 166.3 million, or 17 cents a share, a year earlier.
Among the downs, the company took an impairment charge of $ 230 million of Tumblr, the blogging social site for which it paid $ 1.1 billion in 2013.
If items are excluded, Yahoo earned 13 cents per share, in line with expectations.