Business

Yahoo ‘phasing out’ vertical sites just two years after launch

Two years after Yahoo Chief Executive Marissa Mayer unveiled with great fanfare a host of vertical news sites aimed at creating more traffic and buzz, she is shutting them down.

The embattled Web portal on Wednesday said it is “phasing out” seven of the so-called digital magazines — with the rest, including Yahoo Tech, getting folded into the remaining four verticals.

An undisclosed number of positions will be lost, the company said.

The Sunnyvale, Calif., outfit will focus on news, sports, finance and lifestyle — its “four most successful content areas” — Martha Nelson, Yahoo global editor-in-chief, said in a blog post.

Gone are Yahoo sites dedicated to food, health, parenting, travel, autos, real estate and “makers” — a do-it-yourself arts and crafts page, Nelson said.

The slashing comes as Mayer works feverishly to cut costs as shareholder activists rattle her cage.

On Feb. 2, the company announced that it was cutting 1,700 jobs, or 15 percent of its payroll, and closing five offices.

That bloodletting will save $400 million a year, it said.

The shuttering of the verticals was aimed at simplifying Yahoo’s business model.

It is not known whether the cuts will satisfy activists.

Yahoo shares are down nearly 12 percent this year and 34 percent in the last 12 months.

Revenue is falling, and Mayer is being pressured to spin off parts of the company.

Last month, Jeff Smith, chief executive of activist hedge fund Starboard Value, let it be known he would like the company to separate its stake in Alibaba, the Chinese e-commerce giant, to pump up shareholder value.

“We need to create the very best version of Yahoo,” Mayer said during a conference call earlier this month. “We also see a lot of value in the spinoff transaction.”

The inclusion of Yahoo Finance as one of the four surviving digital magazines isn’t a mistake — the site scored a huge win on Tuesday when it announced it will broadcast the annual shareholder meeting of Warren Buffett’s Berkshire Hathaway on April 30, an event that usually attracts more than 40,000 investors who want to hear from the Oracle of Omaha.

Yahoo shares inched up 9 cents on Wednesday, to $29.37.