Yahoo is to lay off 2,000 employees worldwide, signalling a broad shakeup of the company.

"Today's actions are an important next step toward a bold, new Yahoo - smaller, nimbler, more profitable and better equipped to innovate as fast as our customers and our industry require," chief executive Scott Thompson. "Our goal is to get back to our core purpose - putting our users and advertisers first - and we are moving aggressively to achieve that goal."

Yahoo, which ended 2011 with roughly 14,000 employees, said it would save $375 million annually from the cuts. It will incur a pretax cash charge in the second quarter of $125 million to $145 million in connection with the cuts, it said.

The company declined to comment on severance details.

It is not yet known what impact the cuts will have on Yahoo's Irish workforce.

Some analysts seemed sceptical about the layoffs, which had been widely expected.

"You can't cut your way to revenue growth," said Colin Gillis of BGC Partners. "What people want to see out of Yahoo is they want to see a plan and provision for revenue growth."

Yahoo said it would provide more details when it released first-quarter results on April 17.

The layoffs come as Yahoo's revenue declines amid competition from rivals Google and Facebook, and as the company fights a proxy battle with hedge fund manager Daniel Loeb.

Mr Loeb, who runs Third Point, is seeking to appoint four new directors to Yahoo's board. Third Point, with a 5.8 per cent stake in Yahoo, is the company's largest shareholder.

Reuters