Yahoo to Lay Off 1,600-Plus Staffers, More Than 20% of Headcount, in Revamp of Ad-Tech Biz

Yahoo is the latest in the digital media sector to slash jobs — planning to cut more than 1,600 employees from its ad-tech division, as it phases out its supply side platform.

The company expects to reduce the workforce of its ad-tech division, previously called Yahoo For Business, by nearly 50% by the end of 2023. The cuts represent over 20% of the total workforce of Yahoo, or more than 1,600 employees. The layoffs will affect nearly 1,000 employees this week.

More from Variety

A Yahoo rep confirmed the planned job cuts, first reported by Axios.

“These decisions are never easy, but we believe these changes will simplify and strengthen our advertising business for the long run, while enabling Yahoo to deliver better value to our customers and partners,” the Yahoo spokesperson said in a statement to Variety.

Yahoo’s previous strategy in the ads business was to offer a “unified stack” consisting of a demand side platform (DSP), supply side platform (SSP) and native advertising platforms. However, “Despite many years of effort and investment, this strategy was not profitable and struggled to live up to our high standards across the entire stack,” and as such it will shut down the SSP side of the business, the company spokesperson said.

Yahoo CEO Jim Lanzone, in an interview with Axios, said the sunsetting of the unprofitable SSP business will be “tremendously beneficial for the profitability of Yahoo overall.”

Going forward, Yahoo will focus solely on its flagship DSP business, reorganized in a division that will be called Yahoo Advertising. As part of the change, the spokesperson said, the company will “prioritize support for our top global customers” and relaunch dedicated ad-sales teams for Yahoo’s owned-and-operated properties (including Yahoo Finance, Yahoo News and Yahoo Sports). Yahoo will migrate its native advertising efforts to its long-term partnership with native-advertising provider Taboola, which was announced in November.

Verizon sold Yahoo for $5 billion in 2021 to private-equity firm Apollo Global. Yahoo, whose brands include AOL, TechCrunch and Engadget, says it reaches nearly 900 million users worldwide.

Pictured above: Yahoo CEO Jim Lazone

VIP+ Analysis: Why Media & Tech Layoffs Are Soaring

Best of Variety

Sign up for Variety’s Newsletter. For the latest news, follow us on Facebook, Twitter, and Instagram.