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Business

Verizon cuts 7 percent of employees in failing Yahoo / AOL division




  A Verizon logo shown along with stock prices on the New York Stock Exchange.
Enlarge / A screen seen on the floor of the New York Stock Exchange Tuesday, September 4, 2018.

Getty Images | Bloomberg

Verizon this week is in 7 percent of the 1[ads1]1,385 employees in its missing media department, which includes Yahoo and AOL.

Verizon confirmed the job launch to Ars and provided the text of an email sent to employees on Wednesday. The cuts were reported yesterday by The Wall Street Journal .

"This week we will make changes that will affect around 7 percent of our global workforce across the organization, as well as some brands and products," Verizon Media CEO Guru Gowrappan wrote in the email to employees.

The media department will affect about 800 employees. Verizon told Ars that the cuts will apply broadly, "the group's global organization involved across all areas."

Verizon bought Yahoo for $ 4,448 billion in June 2017 and bought AOL for $ 4.4 billion in June 2015. Yahoo and AOL were initially combined with a subsidiary called owned, renamed Verizon Media this month. Verinson's media department has not been able to compete effectively against Google and Facebook in the advertising market.

Verizon described the media group's errors last month in a Securities and Exchange Commission filing. The division has experienced increased competition and market pressure through 2018, which has led to lower-than-expected revenues and earnings, Verizon said at that time, adding that "

Last month, Verizon said it would "record a non-cash write-down fee of around $ 4.6 billion, and delete almost all of the Yahoo / AOL division's goodwill value. Verizon Media's quarterly revenue was $ 1.8 billion in Q3 2018, down from $ 2 billion in Q3 2017, Journal article said.

Verizon also said in December that it separates ways with 10,400 employees in a "voluntary separation program" that affects nearly 7 percent of Verin's total workforce. While buyouts affected all Verizon, the layoffs are announced this week focused on the media department.

Verizon insists that "will continue to scale"

"I want to be aware that we will continue to scale, launch new products and inward," wrote the Gowrappan in his email to employees Wednesday. "We are an important part of Verizon, and the $ 7 billion in revenue we generate through our member-centric ecosystem puts us among the best tech / media companies in the world. Now is the time to go on the offensive, go deep on our High priorities and doing everything we can to promote the business. "

Gowrappan e-mail described three priorities that Verizon Media will focus on:" First, grow our member-centric ecosystem with the most mobile and video products and desktop desktops as possible Second, increase usage and spend power through B2B platforms, third, expand our video supply and overall distribution through partnerships. "

According to Verizon, positive momentum for the media group includes Yahoo Sports & nbsp; streaming, Yahoo Finance expanded "bell-to-bell" coverage and visitor growth, and Yahoo-HuffPost News Network gets 41 million visitors in November. Verizon said it also achieved double-digit year-over-year growth in native advertising.

Gowrappan started a strategic review of the business after becoming Verizon Media CEO in October. Yahoo was identified as one of the strongest brands in the industry, Journal .

"Despite the layoffs, Verizon plans to hire new technology and content development personnel," Journal also wrote. "The new workers will focus on building new services that show Verizon's faster, 5G network."



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