A 15%, that equals 2100 jobs, to be cut at AOL and Yahoo by Verizon
Verizon Communications Inc. has acquired the core assets of Yahoo as the shareholders approved to sell the company. The deal will be completed in the coming week for $4.48 Billion. After this acquisition, the first step that the company is rumored to take is to cut down almost 2100 jobs. These cuts are anticipated to come from the Yahoo and AOL units, which will represent a 15% staff reduction from these 2 units. A majority of jobs are located in California, whereas few are outside the United States. At present, there are almost 14,000 employees across Yahoo and AOL.
Verizon has acquired AOL back in 2015 for around $4.4 Billion. And now, the leading wireless operator is merging the email, search, advertising technology tools, and messenger of Yahoo with its AOL unit. The company is assuming advertising and mobile video to be the new means of income outside the supersaturated wireless market. The shares of Verizon have dropped down this year by almost 15%. The procurement of Yahoo has lost its identity as a standalone firm, a company that once was a Web pioneer esteemed at more than $100 Billion.
Earlier, in February, Verizon and Yahoo had settled to knock off Yahoo’s sale price at $350 Million. However, the closing of the deal was postponed as the companies evaluated the consequence from 2 massive Yahoo data breaches. One of which assessed to encompass around 500 Million accounts, whereas another impacting more than 1 Billion accounts. Eventually, the deal price was cut down to 4.48 Billion.
Yahoo and AOL will be rebranded by the company as a part of a new project, which will be recognized as “Oath.” The new venture will be headed by Tim Armstrong, AOL Chief Executive Officer. The company is expecting to use the information from the unique monthly visitors to the sites of Yahoo, which totals more than 200 Million, and merge it with the data of 150 Million exclusive monthly AOL users and its own 100-Million user base of wireless subscribers to provide the advertisers with more targeted services.
The Yahoo deal was finalized after the activist stockholders led by Starboard Value LP lost confidence in Marissa Mayer, the Chief Executive Officer of Yahoo, who was employed in 2012 and enforced the trade of the core assets of the company. However, Yahoo is still one of the biggest assets on the Internet, with so many customers using its finance, sports, and email services, and a greatly trafficked home page.