In order to reorganise its Ad Technology Group, Yahoo plans to cut its workforce by 20%.

Over half of Yahoo’s ad tech staff will be laid off before the end of the year, including over 1,000 employees this week.

Yahoo announced that it will lay off more than 20 percent of its total personnel as part of its drive to restructure its ad tech division. According to the company, this round of layoffs will touch about half of the ad tech workforce by the end of the year, including roughly 1,000 employees this week.

According to Yahoo, the decision will allow the company to focus its efforts and financial resources on its demand-side platform (DSP), which is its core advertising business. Apollo Global Management, a private equity firm, acquired the company in 2021 after having paid $5 billion for Yahoo.

According to Reuters, the company’s round of layoffs comes at a time when many advertisers are lowering their marketing budgets due to record-high inflation rates and recession fears.

Several companies, notably Amazon and Google, have laid off thousands of staff this year. Yahoo is next in this extensive list. Axios was the first to disclose the news, predicting that the layoffs will disrupt Yahoo’s long-standing policy of directly targeting Google and Meta for digital advertising domination.

The CEO of Yahoo, Jim Lanzone, asserted that strategic shifts rather than financial concerns were the cause of layoffs. Lanzone is quoted in the story as claiming that these layoffs will be “very beneficial for Yahoo’s overall profitability.” It will allow the corporation to invest more in other profitable business projects.

It was stated that 14% of planned layoffs will occur during this phase, with the remaining 8% or more occurring in the second half of the year. Although Lanzone did not disclose a precise number of those affected, she did suggest that more than half of the present ad tech section workers will be impacted.