Say Yahoo, wave goodbye
Yahoo has announced that chief operating officer Henrique de Castro will be leaving the company by the end of the week.
This unexpected move comes just a year after CEO Marissa Mayer made Castro one of the highest paid employees in the industry, with the former Google employee expected to receive a multi-million dollar severance package.
Reports suggest that there had been tension between Castro and Mayer, while news that display advertising revenue had fallen by seven per cent year-on-year may well have also been a factor.
What next for Yahoo?
The appointment of Castro had been quite the coup for Yahoo, and his loss is expected to be an expensive one. In addition to the cost of the pay off, Castro was the top sales executive at the company and had been responsible for building relationships with key advertisers.
Losing Castro will be damaging enough, but the unexpected nature and rapid timeline of his departure is likely to have a significant impact on advertising revenue. Yahoo shares fell by 0.6 per cent in the aftermath of the news, further bad news following the announcement in October that the company had lowered its profit expectations for 2013.
Daniel Nolan, managing director at theEword, commented on the news: "Losing employees is a natural part of business, and I am certain Yahoo will have contingency plans in place for the departure of such a high ranking employee. However, with Castro leaving the company by the end of the week, swift action will have to be taken to avoid major disruption and falling even further behind market leader Google as a consequence.