Next week, Verizon is expected to finally complete its previously announced acquisition of Yahoo for about $4.8 billion. After that deal closes, Verizon is reportedly planning to almost immediately announce layoffs at both Yahoo and its own AOL units, with a combined total of 2,000 jobs cut.
Yahoo shareholders, as expected, voted to approve its purchase by Verizon earlier today. Reuters reports, via unnamed sources, that the layoffs next week will total about 15 percent of the combined workers at AOL and Yahoo. Verizon has already revealed it plans to merge those two companies into a new subsidiary called Oath, which will be headed up by current AOL CEO Tim Armstrong. Yahoo’s CEO Marissa Mayer will not be joining Verizon after the purchase is complete.
You may be wondering why Verizon even wants to buy Yahoo in the first place. Well, the company believes it can leverage Yahoo’s huge base of 200 million monthly visitors as a way to give advertisers an even bigger audience for selling products to customers. Verizon Wireless has over 100 million subscribers and its AOL properties like Engadget, TechCrunch and others, which Verizon bought in 2015 for $4.4 billion, have about 150 million monthly users. While some of those subscriber numbers will certainly overlap, Verizon likely believes the total amount of unique users after this deal is finalized will be a big draw for businesses.