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Wednesday, 10 October, 2001, 22:29 GMT 23:29 UK
Loss-making Yahoo mulls lay-offs
Yahoo graphic
Yahoo: flying the flag for the sector
Internet services giant Yahoo has threatened to axe further jobs, after revealing a slump in revenues.

Announcing a company restructuring around core areas, the firm said there "may" be a reduction in the workforce.

The warning came after the firm revealed a net loss of $24.1m for the July-to-September quarter, compared with a $47.7m profit a year earlier.

The results, announced after the close of markets on Wednesday, had been well received by Wall Street investors, sending Yahoo shares up 8% in after-hours trade.

And the sector received a further boost when E-Trade, while also reporting losses, raised forecasts for the last three months of the year.

Ad slump

Net revenue at Yahoo slumped 44% to $166.1m over the quarter as the firm struggled amid the slide in advertising.

The turmoil following the 11 September attacks cost Yahoo $2m-3m in revenues over the period, chief financial officer Susan Decker said.

But the firm managed to record underlying profits, after one-off costs and investment losses, of $8.4m, albeit a fraction of the $81.1m recorded a year earlier.

Yahoo forecast revenues of $160m-180m over the last three months of the year.

'Customer focus'

E-Trade also announced a company shake-up, including the creation of the post of president.

"The current environment makes it more imperative than ever that companies be able to act with speed and decisiveness," Christos Cotsakos, chief executive, said.

The shake-up would enhance E-Trade's "customer focus" while "continuing to increase operational efficiency and effectiveness".

The move follows a quarter in which dealing activity slumped, with 91,000 trades booked compared with 150,000 a year before.

Nonetheless, underlying operating profits rose to $9.3m over the quarter, from $7.2m a year before, despite a 14% slide in revenues to $292.2m.

The firm blamed a $227m restructuring charge for an overall net loss of $243.7m.

The BBC's Louise Greenwood
"The firm remains hopeful its fortunes will change"
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