Yahoo faces exodus of top managers after ending Microsoft talks
The entrance of Yahoo headquarters in Sunnyvale, California> Photo: HECTOR MATA/AFP/Getty Images
Friday June 20 2008
Yahoo! Inc. Chief Executive Officer Jerry Yang faces an exodus of top managers, challenging his effort to turn around the Internet company.
At least nine officials may have decided to leave, and the Wall Street Journal reported that Sunnyvale, California-based Yahoo may centralize its e-mail, search and homepage units into a global division to improve communication between teams.
Losses amid Yahoo's ranks, including Jeff Weiner from the networks unit and Qi Lu from the search business, may make it harder for the company to prosper on its own. Billionaire investor Carl Icahn is seeking to oust Yang, whom he blames for scuttling an acquisition by Microsoft Corp.
``It's going to cause a cave-in from the top down,'' Colin Gillis, a Canaccord Adams Inc. analyst in New York, said of the lost top engineering talent. He recommends selling the shares.
Yahoo, owner of the second most popular online search engine, said yesterday that Lu, its senior vice president of search technology, will leave Aug. 31. Yahoo agreed last week to allow bigger rival Google Inc. to sell advertisements on some of its search results, a partnership Yang reached after scrapping talks with Microsoft.
Weiner will step down as head of the network division at the end of June, and Senior Vice President Vish Makhijani is becoming the leader of Russian Web search company Yandex's new Silicon Valley office. Stewart Butterfield and Caterina Fake -- co- founders of the Flickr photo-sharing site, which Yahoo bought in 2005 -- also are leaving, the company said this week. Engineer Jeremy Zawodny announced his departure last week on his blog.
Chief Data Officer Usama Fayyad is leaving, the New York Times said last week, citing a person familiar with the move. The TechCrunch blog said yesterday Senior Vice President Brad Garlinghouse and Joshua Schachter, who founded a Web application company Yahoo bought, are departing as well.
Reorganization
Hilary Schneider, executive vice president for global solutions, will likely gain additional responsibilities in the coming reorganization, the Journal said late yesterday, citing people familiar with the matter.
Details of the plan being formulated by President Susan Decker may be announced as soon as next week, the newspaper said. Yahoo spokeswoman Diana Wong didn't respond to an e-mail last night on the Journal story.
``We have a deep and talented management team across all areas of the company,'' Wong said earlier yesterday about the executive departures. ``Yahoo continues to be a leader in our industry and remains a unique, exciting and important place to work, even as we experience the attrition that's to be expected in the Internet industry.''
Yahoo fell 18 cents to $22.73 yesterday in Nasdaq Stock Market trading. The shares had dropped 13 percent since Yahoo announced talks with Microsoft ended.
Microsoft said last week it offered to buy Yahoo's search engine for $1 billion. The deal would have included an $8 billion investment in the company. The offer followed an earlier bid, rejected by Yahoo, to buy the entire company for $47.5 billion. (Bloomberg)
- Crayton Harrison
