Verizon is cutting 7% of the employees in its media group, or around 800 staffers in the division that combined AOL and Yahoo.
“This week, we will make changes that will impact around 7% of our global workforce across the organization, as well as certain brands and products,” Verizon Media Group CEO Guru Gowrappan wrote in a memo to staffers Wednesday. “These were difficult decisions, and we will ensure that our colleagues are treated with respect and fairness, and given the support they need.”
Gowrappan’s memo suggests that Verizon Media will be shutting down some properties. Verizon reps declined to say what those might be. The cuts were first reported by the Wall Street Journal.
Verizon Media is the new name of Oath, the now-abandoned moniker of the merged AOL–Yahoo. After Oath revenue declined 6.9% in the third quarter of 2018, Verizon took a $4.6 billion charge related to Oath for the fourth quarter of 2018, a write-down representing the elimination of nearly the entire goodwill balance Verizon was carrying for the Oath acquisitions. Gowrappan, a former Alibaba and Yahoo exec, took over the reins last October after former Oath CEO Tim Armstrong left the company.
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According to Gowrappan’s memo, in the first quarter of 2019, Verizon Media will focus on three areas: growing the Yahoo “member-centric ecosystem with must-have mobile and video products and stem desktop declines”; increasing usage and spending through business-to-business advertising platforms; and expanding video supply and overall distribution through partnerships.
Brands in the Verizon Media Group include HuffPost, TechCrunch, Engadget, AOL.com, Yahoo Sports, Yahoo Finance, RYOT, MAKERS, Tumblr, Build Studios, Yahoo Mail and Verizon Digital Media Services.
“I want to be clear that we will continue to scale, launch new products and innovate,” Gowrappan said in the memo. “We are an important part of Verizon and the $7+ billion in revenue we generate through our member-centric ecosystem puts us among the top tech/media companies in the world. Now is the time to go on the offensive, go deep on our big priorities and do everything we can to advance the business.”
Amid the ongoing struggles for Verizon Media/Oath, Gowrappan called out bright spots, including its expanded multiyear ad deal with Microsoft, under which marketers using Oath Ad Platforms will gain access to 20% more native inventory across Microsoft properties globally including MSN, Outlook and Xbox.
Verizon Media has scheduled a town-hall meeting on Friday for employees about the layoffs and other changes. Verizon is scheduled to report fourth-quarter 2018 earnings next Tuesday (Jan. 29).