More Yahoo Restructuring As Offices, Sales Teams Get Cut Across Europe And Asia

Next Story

Built In Brooklyn: Maker’s Row Bets On US Manufacturing

It looks like Yahoo is laying off more people in its international operations as it rethinks business outside of its core market of North America. In Asia, a source tells us that the company is laying off sales people in Vietnam, Indonesia and Malaysia, affecting around 25, 50 and 15 people respectively. And in Singapore, while there are currently no redundancies, one of Yahoo’s most senior regional sales heads based in that office, Yvonne Chang, VP of APAC ad sales, is leaving.

Meanwhile, in Europe, Middle East and Africa, the company is undertaking an “operational review” across the region. That has resulted in the closure of Yahoo’s operations in Budapest, Hungary, on top of the closure of Yahoo’s office in Jordan, which we reported on last month.

A spokesperson confirmed the departure of Chang in Singapore, as well as the review and restructuring in Budapest, providing the following statement that indicates there may be more to come:

We recently shared with Yahoo employees in the EMEA region that we will be undertaking an operational review that proposes changes to the way our teams and businesses are structured in the region. This is part of our efforts to streamline our EMEA operations and realign resources and investments in a way that sets up Yahoo’s business in the region on a path of sustainable growth.

The EMEA region continues to be an important market for Yahoo, and we are strongly committed to delivering the best possible products and experiences for our users and advertisers.

The spokesperson would not comment on the downsizing in Vietnam, Indonesia, and Malaysia, nor are there more details on whether and what further cuts might come in Europe.

Our source speculates that this could be because Yahoo is planning to write down these charges in its fourth quarter earnings, which will be out in January. The Vietnam office, in Ho Chi Minh City, was actually closed in Q3, while employees in Indonesia and Malaysia have been told that Yahoo will be closing by December 14. These employees are still working out their notice period, our source tells us.

One thing we do know so far is that unlike the situation in India, where some engineers were offered to relocate to Yahoo’s offices in California after Yahoo cut 400 people from its operations in Bangalore, no employees in this current round of cuts are being offered jobs elsewhere.

This may be due to the fact that these are largely sales roles, an area that has seen flagging performance for a while now.

In the last quarter, revenues ex-TAC in EMEA were $81 million and grew 2.3% between Q3 2014 and 2013, while revenues in North America, which are more than ten times bigger at $831 million, grew by just under 2%. Meanwhile, revenues in Asia Pacific, which were $182 million in the quarter, declined by 2.5% over a year ago. Despite this, Yahoo beat analysts’ expectations last quarter because of a healthy bump from its sale of some of its Alibaba stock.

Asia — currently overseen by Rose Tsou, Yahoo’s SVP for Asia Pacific — is expected to pull in some $700 million in revenue for the full year this year, but that’s down from over $1 billion five years ago.

The moves in Indonesia, Malaysia and Vietnam have yet to be confirmed by Yahoo, but if they are accurate, they are a repeat of the story from last month in Jordan. There, the office was built out of an acquisition Yahoo made of a local portal called Maktoob to boost its international footprint. Similarly, in Indonesia in 2010 Yahoo acquired Koprol — which was like Foursquare when it was still based around check-ins.

There is also a curious counterpoint here of Yahoo giving up at a time when other tech companies are targeting emerging markets in Asia more than ever.

While there have certainly been complications around Internet censorship in parts of Asia — sites like Facebook and even WordPress often get blocked, for example, in Vietnam — countries like Indonesia, where people are still rapidly adopting Internet services accessed via mobile handsets, represent some of the biggest opportunities for companies whose businesses have seen slowing growth in more mature markets.

This was part of the rationale for Facebook CEO Mark Zuckerberg recently visiting Asia and launching initiatives to encourage more mobile data usage.

Of course, Yahoo is in a far different position from companies like Google and Facebook in the U.S.: it has a long way to go before it can safely say it’s saturated the market, and this is part of why the company has put a lot of focus on building up its operations in the U.S. through acquisitions and product sprints.

Indeed, while Yahoo continues to rationalize and downsize abroad, it’s also opening up a new chapter at home: last week the company confirmed the appointment of a new SVP for ad sales in North America, Lisa Utzschneider, with Ned Brody shifting to a role as SVP for ad tech and strategy.

Featured Image: Yahoo! It's You Ad Campaign/Flickr UNDER A CC BY 2.0 LICENSE