NEW YORK-Yahoo announced a steep fourth-quarter loss in income and said that it would cut close to 1,000 jobs, or 7 percent of its workforce. The U.S. Internet company's stocks dropped in early trading in Nasdaq, and are on their lowest level since 2003.
Yahoo's net income for the fourth quarter of 2007 came in at $205.7 million, around 24 percent lower than it was in the previous year.
Industry pundits peg the reason for Yahoo's drop in revenues as intense competition from Internet giant Google Inc., which has far streaked past Yahoo in terms of users. Over the last year, Google's share of the paid search market has increased from 60 percent to 75 percent, according to online research company eMarketer. Yahoo's share has dropped to 9 percent.
The U.S. economic slump has also contributed to Yahoo's loss of revenue. Pundits fear that display-advertising-style ads (the image and graphics-heavy ads found on Yahoo mail) are the first to go in times of an economic recession.
Google's upcoming acquisition of online advertising giant DoubleClick has also shaken Yahoo, whose inability to acquire Facebook a few years ago, combined with low popularity of its own social networking sites, have further weakened its market share.
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