Yahoo Inc said it would cut 5 per cent of its global workforce (nearly 700 jobs) and reported quarterly results that showed progress towards controlling costs, sending shares higher in an after-hours relief rally.
The Internet company said economic conditions remained challenging, as revenue on Yahoo Websites from both display ads and search ads fell during the first quarter.
But the decline in revenue was offset by better cost controls, as new Chief Executive Carol Bartz seeks to revive Yahoo's fortunes. "People were really looking at the profit structure of the business and for things not to be falling apart," said Kaufman Brothers analyst Jason Avilio.
Yahoo said last October it would cut about one-tenth of its workforce, or about 1,600 jobs. The company finished 2008 with roughly 13,600 employees and said it would take severance charges from the new round of layoffs during the second quarter.
The company also announced in an internal memo to employees on Tuesday that it planned to implement a mandatory shutdown of operations during the holiday week of December 25, 2009 through January 1, 2010.
Yahoo said its operating cash flow, excluding certain items, was $409 million in the first quarter, at the high end of the $365 million to $415 million range it forecast in January.
Yahoo shares were up 54 cents at $14.92 in after-hours trading on Tuesday. The company's stock is up roughly 9 per cent from its Monday close of $13.66.
Yahoo's financial report comes as speculation has mounted that the firm has restarted discussions with software giant Microsoft Corp about an Internet search partnership, following last year's failed merger negotiations.
Bartz, who replaced Yahoo co-founder Jerry Yang in the top job in January, declined to comment on anything related to Microsoft during the conference call on Tuesday.
But she reiterated her belief that search is a very valuable part of Yahoo's business.
"I'm well-versed enough in the search business at Yahoo to say it's absolutely critical to Yahoo," Bartz said in response to a question regarding whether she is now familiar enough with the business to respond to an offer for search.
In the first full quarter under Bartz's leadership, Yahoo generated revenue of $1.58 billion, down 13 per cent from the year-ago period. Exclud
ing traffic acquisition costs (TAC), Yahoo's revenue was $1.16 billion, compared with the average analyst expectation of $1.2 billion, according to Reuters Estimates.
The Sunnyvale, California-based company reported a net profit in the first quarter of $118 million, or 8 cents a share -- down from $537 million, or 37 cents a share, a year earlier. Wall Street analysts, on average, had forecast earnings at 8 cents a share, according to Reuters Estimates.
While revenues were "a bit light," Jefferies & Co analyst Youssef Squali said in an email that Yahoo's overall results, particularly on the bottom line, were not bad given the environment.
Yahoo said that revenue from display ads on its owned and operated websites slid 13 per cent year-over-year in the first quarter, with revenue from automotive advertisers down "substantially" and spending by retail advertisers "softened" compared to the year ago period.
Revenue from search-based ads on Yahoo sites were down 3 per cent. And Yahoo said that advertisers were spending less money to bid for the individual keywords that their ads appear alongside, echoing a theme present in results last week from Google Inc, the No.1 US Internet search company.
Yahoo, like Google, stressed the importance of keeping costs in line amid the difficult economy. The new round of job cuts come about two months after Bartz announced a reorganization of Yahoo's internal management structure.
The layoffs, said Bartz, are a "natural outgrowth" of the reorganization, which will allow Yahoo to streamline its operations and eliminate duplication of efforts.
The Internet company said it would also continue to implement unspecified "non-headcount cost reductions," so it can increase its ability to make strategic investments and target hiring in its core operations
"It's crucial that management adjusts the cost structure to the new growth (or lack thereof) realities; so margin protection is paramount to Yahoo right now," said Jefferies analyst Squali. "We think there is potential outperformance on margins."
Chief Financial Officer Blake Jorgensen told Reuters there were "still very dark clouds on the horizon" for the economy.
"I'll try to resist calling the bottom in any way," he said in a telephone interview.
Yahoo projected that sales in the current quarter would range between $1.425 billion and $1.625 billion.
Agencies
Showing posts with label costs. Show all posts
Showing posts with label costs. Show all posts
Saturday, April 25, 2009
Friday, April 17, 2009
Infosys to cut variable pay compenent
Infosys has cut the variable pay for employees, with the cuts being deeper at the higher levels. For senior executives, the variable pay, which constitutes nearly 50 per cent of their total compensation, has been slashed by 58 per cent.
“Some boardroom executives have even taken a 70 per cent to 85 per cent variable pay cut,” said T V Mohandas Pai, head of HR in Infosys. The company's hiring has been steadily declining.
In Q4, it added (net) only 1,772 people, compared to 2,772 in Q3, and 2,586 in Q4 of 2007-08. In the whole of 2008-09, it hired (net) 13,663 people, down from 18,946 in the year before.
The company maintained that it will not seek to trim its payroll by laying off software professionals. There will, however, be no salary hike this year, as the company plans to keep its operational costs under control.
“We are not laying off anybody and there are no such plans,” said Infosys Technologies HR-director, TV Mohandas Pai.
Infosys plans to hire 18,000 professionals in the current fiscal, including almost 16,000 fresh graduates and experienced hires. It will also recruit around 1,000 non-Indians outside the country to increase the number of foreign professionals in its workforce.
Times News Network
“Some boardroom executives have even taken a 70 per cent to 85 per cent variable pay cut,” said T V Mohandas Pai, head of HR in Infosys. The company's hiring has been steadily declining.
In Q4, it added (net) only 1,772 people, compared to 2,772 in Q3, and 2,586 in Q4 of 2007-08. In the whole of 2008-09, it hired (net) 13,663 people, down from 18,946 in the year before.
The company maintained that it will not seek to trim its payroll by laying off software professionals. There will, however, be no salary hike this year, as the company plans to keep its operational costs under control.
“We are not laying off anybody and there are no such plans,” said Infosys Technologies HR-director, TV Mohandas Pai.
Infosys plans to hire 18,000 professionals in the current fiscal, including almost 16,000 fresh graduates and experienced hires. It will also recruit around 1,000 non-Indians outside the country to increase the number of foreign professionals in its workforce.
Times News Network
Tuesday, February 24, 2009
Is Vodafone to layoff hundreds of jobs?
Vodafone, the world's largest mobile phone group by revenue, is to cut hundreds of jobs in Britain, according to a report on Sky News.
The move to cut jobs could be made as early as Tuesday, said the report.
The mobile phone operator, which employs 10,000 people, has previously said it will boost free cash flow by cutting 1 billion pounds of costs.
Vodafone declined to comment on specific job cuts.
Agencies
The move to cut jobs could be made as early as Tuesday, said the report.
The mobile phone operator, which employs 10,000 people, has previously said it will boost free cash flow by cutting 1 billion pounds of costs.
Vodafone declined to comment on specific job cuts.
Agencies
Thursday, December 4, 2008
Here is how Google is cutting costs!
Feeling the pinch of the global economic slowdown and the US recession in particular, Google, the Internet search engine giant, is resorting to austerity measures, The Wall Street Journal reported.
Prominent among them include cutting new projects, ratcheting back spending, chipping away at perks and reducing employee strength. Such measure from Google, which is known for its generous perks, has come as a surprise to many industry watchers.
The latest Google measures are understandable as its revenue growth has slowed down dramatically over the past one year.
“We have to behave as though we don't know what's going to happen,” Google chief executive Eric Schmidt was quoted as saying by The Wall Street Journal.
The company will curtail the “dark matter,” Schmidt said, projects that “haven't really caught on” and “aren't really that exciting.”
Schmidt said the company is “not going to give” an engineer 20 people to work with on certain experimental projects anymore. Popular social networking site Orkut was a product of this experiment by Google. Schmidt, however, promised to get this back when things improve.
Google executives had started preparing for the slowdown about a year ago, but things have now accelerated. In recent weeks, Schmidt has held meetings with top executives to determine where to focus investment more narrowly, the Journal said.
Top priorities include display ads, which use graphics and appear on Web pages; advertising on mobile phones; and the company's online business software.
Schmidt says the company is shifting more engineering and sales resources to those areas, and away from less-promising projects. Teams on projects the company is merely "fiddling with," he says, will get "naturally smaller as people get plucked off,” the report said.
The Wall Street Journal said the financial crisis has created a new sense of urgency within the company. Top executives say they remain committed to projects they believe hold long-term potential, but are prepared to “starve” lesser ones.
Prominent among them include cutting new projects, ratcheting back spending, chipping away at perks and reducing employee strength. Such measure from Google, which is known for its generous perks, has come as a surprise to many industry watchers.
The latest Google measures are understandable as its revenue growth has slowed down dramatically over the past one year.
“We have to behave as though we don't know what's going to happen,” Google chief executive Eric Schmidt was quoted as saying by The Wall Street Journal.
The company will curtail the “dark matter,” Schmidt said, projects that “haven't really caught on” and “aren't really that exciting.”
Schmidt said the company is “not going to give” an engineer 20 people to work with on certain experimental projects anymore. Popular social networking site Orkut was a product of this experiment by Google. Schmidt, however, promised to get this back when things improve.
Google executives had started preparing for the slowdown about a year ago, but things have now accelerated. In recent weeks, Schmidt has held meetings with top executives to determine where to focus investment more narrowly, the Journal said.
Top priorities include display ads, which use graphics and appear on Web pages; advertising on mobile phones; and the company's online business software.
Schmidt says the company is shifting more engineering and sales resources to those areas, and away from less-promising projects. Teams on projects the company is merely "fiddling with," he says, will get "naturally smaller as people get plucked off,” the report said.
The Wall Street Journal said the financial crisis has created a new sense of urgency within the company. Top executives say they remain committed to projects they believe hold long-term potential, but are prepared to “starve” lesser ones.
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