Yahoo is cutting 2,000 jobs as new chief executive Scott Thompson clears out areas that do not fit into his plans for turning around the beleaguered internet company.
The cuts represent about 14% of the 14,100 workers employed by Yahoo.
The company estimated it will save about 375 million dollars annually after the layoffs are completed later this year.
The housecleaning marks Yahoo's sixth mass layoff in the past four years under three different chief executives. This one will inflict the deepest cuts yet, eclipsing a cost-cutting spree that laid off 1,500 workers in late 2008 as Yahoo tried to cope with the Great Recession.
The previous purges under Yahoo co-founder Jerry Yang and his successor, Carol Bartz, boosted earnings. But trimming the payroll did not reverse a revenue slump, which has disillusioned investors yearning for growth at a time when more advertising is flowing to the internet.
The cuts are part of an overhaul aimed at focusing on what Mr Thompson believes are Yahoo's strengths while also trying to address its weaknesses in the increasingly important mobile computing market.
He is betting Yahoo will be able to sell more advertising if it is more astute in the analysis of the personal information that it collects from the roughly 700 million people who visit its website each month. He is also looking for ways to improve the products that it makes for smartphones and tablet computers, a goal that may require hiring more specialists in mobile technology.
Yahoo also has been exploring selling a service, called Right Media that helps place ads around the web. If a deal gets done, that would enable Yahoo to shed even more workers.
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