Yahoo! Shift Falls Flat

Updated from 8:54 a.m.

Yahoo! (YHOO Quote) failed to win over Wall Street with its latest strategic shift.

Hoping to reassert its relevance in the Internet space, the Sunnyvale, Calif., Internet giant handed a new job late Tuesday to Chief Financial Officer Susan Decker. Chief Operating Dan Rosensweig and media group chief Lloyd Braun will depart.

But investors, having endured a year full of operational and financial pratfalls at Yahoo!, weren't impressed. Yahoo! shares fell 1.6% in early action Wednesday. The reaction suggests that shareholders continue to lack confidence in CEO Terry Semel and Decker, now in position as his heir apparent.

The changes were revealed as Yahoo! said it will form three operating groups -- an audience division, a technology unit and an advertising and publishing segment, the latter of which will be led by Decker.

Because of Decker's new responsibilities, Yahoo! plans to hire a replacement for the CFO slot.

Heading the technology group will be Chief Technology Officer Farzad Nazem. Yahoo! has launched a search for an experienced executive to be in charge of the audience group.

"Our strategy capitalizes on big emerging trends and leverages our core strengths in search, media, communities and communications," Semel said. "We believe having a more customer-focused organization, supported by robust technology, will speed the development of leading-edge experiences for our most valuable audience segments.

"In turn, we plan to drive growth and profitability by leveraging our deep audience insights to create a full-fledged advertising network, with a marketplace that meets supply and demand both on Yahoo's valuable owned-and-operated network and across the entire Internet," he continued.