Updated from 8:54 a.m.
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.
Yahoo! said its strategy will be "to create unique user experiences and consumer insights by leveraging its unmatched global user participation, connections and data."
The new Yahoo! will have four key objectives -- expanding "customer-centric culture and capabilities," creating top-notch social-media environments, taking the lead in next-generation advertising platforms and driving "organizational effectiveness and scale."
The audience group will be focused on creating more unique and tailored offerings for Yahoo!'s users, and the advertiser and publisher segment will aim to help advertisers better reach their target customers.
As for the technology group, Yahoo! plans to mandate closer engineering integration within product teams. Yahoo! also said it will concentrate its investment toward the development of "high-impact, scalable, global platforms and infrastructures to help capture the most significant long-term growth opportunities."
Shares dropped 43 cents early Wednesday to $27.