Yahoo ‘to cut 10% of staff’

Yahoo is working on a plan to cut its workforce by at least 10% — and it could start the process as early as this month — Business Insider has reported, citing sources.

“We are not confirming this rumour or commenting further,” Sarah Meron, a spokeswoman for Yahoo said.

The layoffs would result in more than 1,000 people leaving the tech giant, it was reported.

They are set to affect Yahoo’s media business, its European operations, and its platforms-technology group, according to the report.

The move follows activist investor Starboard Value’s letter to Yahoo on Wednesday ramping up pressure on the company, taking aim at chief executive Marissa Mayer and her leadership team, and raising the prospect that a proxy battle is approaching.

Starboard implied that Mayer and her officers needed to go, without naming her specifically.

The activist investor also threatened to shake up the board if Yahoo’s stock continued to suffer.

Report: #Yahoo plans to lay off 10 percent of its workforce as early as this month. https://t.co/cGva89VL6K pic.twitter.com/IwxP9NUyRr

— ABC7 News (@abc7newsbayarea) January 7, 2016

“To be successful, dramatically different thinking is required, together with significant changes across all aspects of the business starting at the board level, and including executive leadership,” Starboard chief executive Jeffrey Smith said in its letter.

Yahoo spokeswoman Rebecca Neufeld said the company will provide more details on its turnaround plan prior to its fourth-quarter earnings call this month.

Starboard owns about 0.75% of Yahoo.

It has been pushing for changes at the internet company since 2014.

The investor seeks it to separate its Asian assets and auction off the core business.

The investor — together with other shareholders — has demanded that Yahoo separate the Asian assets.

Those assets include stakes in Chinese e-commerce company Alibaba and Yahoo Japan.

The investor also wants Yahoo to conduct an immediate public auction of the core business, including search and advertising businesses.

But Yahoo is resisting, instead pursuing a tax-free spinoff of the core business, which could take at least a year.

Yahoo had appointed management consulting firm McKinsey, in November, to help with the reorganisation of its core businesses.

The company also had plans to make big changes to its media unit, restructuring and consolidating it, including making cuts and shuttering some efforts.

In December, Yahoo shelved plans to spin off the Alibaba stake.

The company said that it would create a separate company that would house Yahoo’s Internet business and its stake in Yahoo Japan.