Yahoo’s Job-Cut Expense: Up To $27 Million

Yahoo will incur a change of between $22 million and $27 million for the 700-person workforce reduction that it announced two months ago, according to an SEC filing late Friday. The layoffs accounted for about 5 percent of its workforce. In Q2, it will take a total pre-tax cash charges of between $30 million and $34 million in severance pay expenses and related cash expenditures; these will offset by a credit related to stock-based compensation expense reversals for forfeited stock-based awards of between $7 million and $8 million, and hence the net charge.

Meanwhile, the cover story in this week’s Barron’s is a love letter of sorts to Carol Bartz, the no-nonsense CEO of Yahoo (NSDQ: YHOO). It posits that the embattled Web company will be a win for investors under her, whether it remains independent or gets bought by Microsoft.

Part of the optimism is due to her background with Autodesk, and the hiring of new CFO Timothy Morse, a proven cost-cutter, the story says. “Among Bartz’s primary objectives are cleaning up the redundant legacy software codes inside Yahoo! that stymie innovation and prevent nimble execution of new products and services across the Website.” If she can only achieve that, the new new Yahoo would emerge as a leaner company ready to grow much faster than it has in the past. The story also quotes experts who think that Yahoo could benefit a lot by building up its content areas in divisions like Finance, Sports and others. There, it would be easier to buy than build, like it did with Rivals.com. Does that mean an AOL-like Mediaglow strategy? If both of these companies do aggressively build up on original content, it may not be as gloomy future for online content companies as others have predicted.