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Yahoo Downsizes In Latin America, Closes Mexico And Argentina Operations

Yahoo Downsizes In Latin America, Closes Mexico And Argentina Operations

Posted by PanamericanWorld on January 28, 2016

Ahead of its Q4 earnings and news of a bigger restructuring, Yahoo is downsizing in its regional operations, specifically in Latin America. TechCrunch has learned and confirmed that Yahoo has closed its offices in Mexico City and Buenos Aires, Argentina. But it’s not pulling out of Latin America altogether: the company is keeping teams in Sao Paulo, Brazil and Coral Gables, Florida.

Yahoo declined to say how many people are being impacted by the closure. It does not plan to outsource any of its operations to third parties, which is one route that some tech companies have taken to building out and running commercial operations in the region. We are speaking to sources close to the Latin American operations and will update this story as we learn more.

Under CEO Marissa Mayer, Yahoo has been downsizing operations in international markets for a while now, for example reducing staff or closing offices altogether in IndiaChina, other parts of Asia and Europe and the Middle East.

Much of that was done in the context of a company in the midst of an aggressive bid to rejuvenate itself: Mayer was also leading the charge on dozens of startup acquisitions to boost Yahoo’s platform and talent pool after the once-mighty giant of the Internet toiled under years of stagnation, falling behind the likes of Google in key areas like search and mobile; and the closures in regional operations were about streamlining to focus on Yahoo’s core business.

 

While some observers may have raised questions about Mayer’s strategy, it was largely supported and also came with the knowledge that Yahoo was sitting on another sweet asset: its holdings in Alibaba, amounting to billions of dollars on the balance sheet.

In that context, this latest downsizing move in LatAm feels like it is coming at a more urgent time. Investors have run out of patience for the turnaround effort; and there are calls for major changes that could include spinning off or selling different parts of the business. Somebelieve Mayer should leave altogether.

There have been reports that the company is planning to lay off some 10%, or 1,000, employees. We have heard from sources close to the company that the numbers are going to be detailed around the time of Yahoo’s earnings.

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