Yahoo 2009 Annual Report Download - page 49

restructuring charges, net recorded in the year ended December 31, 2008 related to the Q408 restructuring plan,
$68 million related to our U.S. segment and $24 million related to our International segment. During the year
ended December 31, 2009, we incurred total pre-tax cash charges for severance benefits provided and facilities
vacated of approximately $57 million related to the Q408 restructuring plan in connection with the continued
implementation of these initiatives, net of reversal for adjustments to original estimates totaling $8 million. Of
the $65 million in restructuring charges, net recorded in the year ended December 31, 2009 related to the Q408
restructuring plan, $63 million related to the U.S segment and $2 million related to the International segment.
As of December 31, 2009, the aggregate outstanding restructuring liability related to the Q408 restructuring plan
was $60 million, most of which relates to non-cancelable lease costs that we expect to pay over the terms of the
related obligations, which end by the second quarter of 2017.
Q209 Restructuring Plan. During the second quarter of 2009, we implemented new cost reduction initiatives to
further reduce our worldwide workforce by approximately 5 percent. The restructuring plan involves reallocating
resources to align with our strategic priorities including investing resources in some areas, reducing resources in
others, and eliminating some areas of our business that do not support our strategic priorities. During the year
ended December 31, 2009, we incurred total pre-tax cash charges of approximately $35 million in severance and
other related costs related to the Q209 restructuring plan. The pre-tax charges were offset by an $8 million credit
related to non-cash stock-based compensation expense reversals for unvested stock awards that were forfeited. Of
the $27 million in restructuring charges, net recorded in the year ended December 31, 2009 related to the Q209
restructuring plan, $18 million related to the U.S. segment and $9 million related to the International segment.
As of December 31, 2009, the aggregate outstanding restructuring liability related to the Q209 restructuring plan
was $4 million, which we expect to pay out by the end of the third quarter of 2010.
Q409 Restructuring Charges. During the fourth quarter of 2009, we decided to close one of our international
facilities and began implementation of a workforce realignment at the facility to focus resources on our strategic
initiatives. We plan to exit the facility in the third quarter of 2010. During the fourth quarter of 2009, we incurred
total pre-tax cash charges of approximately $16 million in severance and other costs related to this realignment.
In connection with our strategic realignment efforts, an executive of one of our acquired businesses departed. We
incurred $19 million of non-cash stock-based compensation expense for the acceleration of certain of the
executive’s stock-based awards pursuant to the acquisition agreements. Of the $35 million in restructuring
charges, recorded in the fourth quarter ended of 2009, $19 million related to the U.S. segment and $16 million
related to the International segment.
As of December 31, 2009, the aggregate outstanding restructuring liability related to the Q409 restructuring
activities was $15 million, most of which relates to employee severance pay expenses that we expect to
substantially pay out by the end of the third quarter of 2010.
In addition to the charges described above, we currently expect to incur future charges of approximately $28
million to $38 million for non-cancelable lease costs and relocation costs as we continue to exit facilities
identified as part of the Q408 restructuring plan and Q409 restructuring activities, of which $25 million to $33
million relates to the U.S. segment and $3 million to $5 million relates to the International segment. The
expected future charges are expected to be recorded primarily in 2010 and 2011. See Note 16—“Restructuring
charges, net” in the Notes to the consolidated financial statements for additional information.
Goodwill Impairment Charge. We conduct our annual goodwill impairment test as of October 31 each year.
Goodwill is potentially impaired if the carrying value of the reporting unit that contains the goodwill exceeds its
estimated fair value. As a result of this test in 2008, we previously concluded that the carrying value of our
European reporting unit exceeded its fair value and recorded a goodwill impairment charge of approximately
41