CEO Carol Bartz has been in talks with Microsoft for a search and advertising partnership.
Yahoo's shares were down in midday trading Wednesday, six days ahead of the company's first-quarter earnings report, as media reported the company is planning another round of layoffs soon.
Yahoo representatives declined to comment on a New York Times report citing unnamed sources and a "confidential" plan to lay off Yahoo workers on or before Tuesday. The layoffs would be the first since Carol Bartz took over as CEO in January.
Yahoo ended 2008 with 13,600 employees after the company laid off about 1,500 people in December and warned that more layoffs could be on the horizon. The company's total workforce reduction for 2008 was about 2,400.
The Times reported that the next round of layoffs would cut up to several hundred jobs.
Display and search ads have been hurt by the recession and Yahoo has lost ground to Google in the search market. Bartz has participated in talks with Microsoft for a search and advertising partnership. She has taken several steps to streamline and reorganize Yahoo, while trying to capitalize on the strength of its brand and tighten focus on its core businesses.
The company has projected a revenue decline of about 16% to $1.53 billion for the first quarter of 2009.
Yahoo shares traded around $13.85, down 1.56% from their $13.98 opening share price Wednesday. That's well ahead of the company's 52-week low, which saw Yahoo stocks plunge to $8.94 but still down substantially from the struggling company's 52-week high of $29.73 per share.
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