Yahoo plans to lay off 20% of its workforce as tech layoffs pile up

Yahoo plans to cut about 20% of its workforce, or about 1,700 jobs, over the next year as the tech industry continues to lay off employees in the run-up to a possible economic downturn later this year.

The Internet company will cut 1,000 jobs from this week, Yahoo confirmed to CBS MoneyWatch.

Almost half of the layoffs at Yahoo, which has been owned by private equity firm Apollo Global Management since 2021, will come at the unprofitable business ad-tech unit. This store did not deliver as expected.

“Despite years of effort and investment, this strategy has not been profitable and has struggled to meet our high standards across the stack,” Yahoo said in a statement.

Yahoo believes the move “will simplify and strengthen our advertising business over the long term, while enabling Yahoo to deliver better value to our customers and partners,” the statement said.

The job cuts come as some of the country’s biggest tech companies cut jobs, including Google parent companies Alphabet, Amazon, IBM, Lyft, Meta and Microsoft. Tech firms have been quick to hire during the pandemic but are looking to cut costs as consumers pull back spending.

In the past month alone, tech companies have cut more than 60,000 jobs, reversing a hiring frenzy that had soared during the pandemic as millions of Americans shifted their lives online. Industry analysts expect more industry cuts in 2023 as the Federal Reserve continues to hike interest rates to curb inflation.

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