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Verizon Media Group, the umbrella organization that includes portfolio companies AOL and Yahoo, is laying off 7 percent of its staff as the telecom giant focuses on its cellular business.
The cuts impact around 800 employees within the division, which owns such brands as TechCrunch, HuffPost and Tumblr.
In a letter to staff, Verizon Media CEO Guru Gowrappan said that he and his executive team had begun an assessment of the business toward the end of 2018. The priorities going forward, he explained, are to grow the group’s mobile and video products, increase usage of business-to-business platforms and expand its video supply and distribution. Among the changes that Gowrappan has instated since he took over for Tim Armstrong in October are the integration of the Yahoo Mail and Yahoo Home teams.
“Our goal is to create the best experiences for our consumers and the best platforms for our customers,” a Verizon spokeswoman said Wednesday in a statement. “Today marks a strategic step toward better execution of our plans for growth and innovation into the future.”
Under former CEO Lowell McAdam, Verizon invested heavily in its media business, acquiring AOL and Yahoo as part of a goal to grow its audience to 2 billion. But the media business has struggled in a market dominated by technology giants Facebook and Google. In December, Verizon took a $4.6 billion write-down on the unit, formerly called Oath. Meanwhile, recently appointed chief Hans Vestberg has scaled back Verizon’s media ambitions and focused on bringing its next-generation 5G cellular technology to market.
Third-quarter revenues at the former Oath were $1.8 billion, down nearly 7 percent from the same quarter the previous year. The company noted that it expects the unit’s revenue will be relatively flat going forward and will not meet the previous target of $10 billion in revenue by 2020.
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