"The moves appear more like a management reorganization and power shift than a cost reduction activity," wrote Marianne Wolk, an analyst with Susquehanna Financial Group on Wednesday.Īnd Stifel Nicolaus analyst Scott Devitt wrote in a report that he was uncertain "how the reorganization directly addresses. Still, some wondered whether the changes were just lip service. "And it is very likely a necessary step that carries the potential for improved operational efficiencies at the company." "It is a recognition of the organizational and operational challenges Yahoo has faced over the prior 12 months," wrote Citigroup analyst Mark Mahaney in a report Wednesday morning. The company also put Chief Technology Officer Farzad Nazem in charge of a new technology unit and announced that it is looking for someone to lead another new division that will concentrate on building and maintaining the site's audience, with an emphasis on social networking offerings. Squali added that without Braun, who had a background in traditional media, Yahoo is likely to embrace more user-generated content as opposed to "proprietary media." "The departures of both Dan Rosensweig and Lloyd Braun will be received positively by investors, in our view," wrote Jefferies analyst Youssef Squali in a note. In addition to Decker's promotion (she is being put in charge of a new unit that focuses on advertising), Yahoo said that its Chief Operating Officer Dan Rosensweig and media chief Lloyd Braun will be leaving the company.
Several analysts were quick to give Yahoo credit for making some necessary changes. ( Charts), which bought social networking firm MySpace last year. "But we think there are better opportunities elsewhere," he said, adding that his fund recently boosted its stakes in Google and News Corp. And Decker is a very strong executive," said Jason Schrotberger, co-manager of the Turner New Enterprise fund. "What the change in management does is set up things for the next leg of growth. One fund manager who sold his position in Yahoo several months ago said he approved of the reorganization but that Yahoo was still a wait-and-see story. Shares of Yahoo fell about 2 percent in early morning trading on the Nasdaq Wednesday. Shares of top rival Google ( Charts), on the other hand, have gained 17 percent.īut investors didn't applaud the management shake-up. Yahoo's stock has fallen 30 percent, making it the sixth-worst performer in the S&P 500. Wall Street has been hoping to see some changes at Yahoo since the company has endured, to put it mildly, a tough year despite the fact that the online advertising business is booming. The move comes shortly after a top Yahoo executive's internal memo, known as the "Peanut Butter Manifesto" because the exec argued Yahoo was being spread too thin, was leaked to the press. Yahoo's stock has taken a big tumble this year, while the shares of its top rival, Google, keep climbing higher and higher. after Yahoo CFO Susan Decker was given a new role that could put her in line to take over as CEO. Wall Street wonders if Yahoo CEO Terry Semel could soon be on his way out. Yahoo, the world's second-largest online search company, announced a drastic reorganization on Tuesday evening that apparently sets the stage for Chief Financial Officer Susan Decker eventually to succeed embattled Yahoo ( Charts) CEO Terry Semel. NEW YORK () - It looks like the peanut butter has hit the fan at Yahoo.