New Yahoo CEO freezes employee salaries

Bartz follows Obama's lead by freezing salaries as Yahoo looks to rein in its finances.

With Carol Bartz just about a week into her new reign as the CEO of Yahoo, she's already made one tough call - to implement an employee salary freeze.

The company is trying to harness its finances as it struggles for mind and market share while it faces Google and an increasingly bad economy.

"Based on the current economic environment and our focus on keeping costs in line with revenues, we have decided that providing annual salary increases would not be in the best interests of the company or our shareholders," said Kim Rubey, a Yahoo spokesman in an email to Computerworld . "This decision is consistent with our broader focus on strategically reducing Yahoo's costs, an effort that has been underway for some time now."

Industry analysts had said a week ago that Bartz, who is known in business circles as a tough businesswoman who is not afraid to speak her mind, would have some big, and not so easy, decisions to make soon after coming on board to lead online pioneer Yahoo .

Renny Ponvert, CEO of Management CV Inc., whose analysts track CEOs and top executives, said in a previous interview that one of the first things Bartz would need to focus on is improving employee morale. While a salary freeze may not fall in line with that goal, stabilizing the company just might.

"Yahoo [was] struggling even before the economic downturn," said Allan Krans, a senior analyst with Technology Business Research, Inc. "As an early indication, [the salary freeze] says she's focusing on reducing costs. Coming in, people expected she'd have more operational discipline than [former CEO Jerry] Yang. It's like Obama going in and freezing salaries for senior staff. I think a lot of people at Yahoo have been expecting that for some time."

Yahoo has been losing market share to Google in recent years, and Bartz is looking to figure out how the company can rebound in a market that has changed dramatically over the past several years.

Yahoo's salary freeze comes a day after Microsoft announced plans to cut 5,000 jobs amid falling profits. About 1,400 positions already were eliminated this week. The job cuts come as the company announced that fourth-quarter profits fell 11% to US$4.17 billion.

Also Thursday, Google reported that its fourth profit took a dive. CEO Eric Schmidt blamed the declining profits on one-time investment write-downs.

Join the Good Gear Guide newsletter!

Error: Please check your email address.
Rocket to Success - Your 10 Tips for Smarter ERP System Selection

Tags YahooCarol Bartz

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Sharon Gaudin

Computerworld
Show Comments

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Matthew Stivala

HP OfficeJet 250 Mobile Printer

The HP OfficeJet 250 Mobile Printer is a great device that fits perfectly into my fast paced and mobile lifestyle. My first impression of the printer itself was how incredibly compact and sleek the device was.

Armand Abogado

HP OfficeJet 250 Mobile Printer

Wireless printing from my iPhone was also a handy feature, the whole experience was quick and seamless with no setup requirements - accessed through the default iOS printing menu options.

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?