SAN JOSE, California (AP) — Yahoo CEO Marissa Mayer is casting aside a cost-cutting specialist and bringing in software industry veteran Ken Goldman to be chief financial officer as the Internet company's management orchestrates a potentially expensive turnaround attempt.

The departure of CFO Tim Morse, announced Tuesday, isn't a shock. After joining a company, new CEOs often reshuffle senior executives while trying to assemble a management team that's better suited for a shift in direction.

But it usually takes six to nine months before an incoming CEO hires a new chief financial officer, said BGC Financial analyst Colin Gillis.

Mayer is replacing Morse just two months after Yahoo lured her away from Google Inc., suggesting that there may have been some friction between the two, Gillis said.

Morse, 43, will leave the company next month to make way for Goldman, who take over as CFO on Oct. 22. Yahoo didn't immediately disclose whether Morse will receive a severance package or reveal how much it is paying Goldman to leave his current job as CFO of Fortinet Inc., a maker of computer security software.

Since joining Yahoo in June 2009, Morse has spent much of his time pruning costs — an endeavor that enabled the company to boost its profits even as its revenue has been drooping.

Although she hasn't yet shared her vision publicly, Mayer is believed to be focusing on steps designed to delight Yahoo's audience of 700 million worldwide users but not necessarily investors. As part of that process, Yahoo could pour more money into some products and remove some of the ads that clutter its Web pages to the exasperation of some users. She is sharing more of her vision with Yahoo employees in a series of meetings beginning this week.

"I think we can kiss (Yahoo's) increasing (profit) margins goodbye for a while," Gillis said.

Yahoo has declined to discuss Mayer's plans. The company says she will talk more extensively next month when the company reports its third-quarter results. A specific date for the earnings release hasn't been set.

The company's stock added 8 cents to $15.76 in Tuesday's extended trading after the CFO change was announced. Yahoo shares have been hovering between $15 and $16 through most of Mayer's brief tenure, reflecting Wall Street's uncertainty about what direction she intends to push the company.

Goldman, 63, has been in management for more than 30 years and has been a CFO with at least six other companies, including Fortinet, which is located about five miles from Yahoo's Sunnyvale, California, headquarters. He is perhaps best known as the CFO of Siebel Systems, where he worked for six years until the business software maker was sold to rival Oracle Corp. for $6.1 billion.

"Yahoo is an iconic brand with an incredibly strong business model and balance sheet," Goldman said in a statement. "I believe there is a lot of runway ahead for this business, and I look forward to working with Marissa and the rest of the executive team as we define Yahoo's future."

Goldman will have more cash to work with because of a complicated deal that Morse played a key role in negotiating. During the past two years, he helped broker a deal that culminated in Yahoo selling half of its 40 percent stake in one of China's rising Internet stars, Alibaba Group. The $7.6 billion sale, including a revised technology licensing agreement, was completed last week.

After taxes, Yahoo anticipates a $4.3 billion windfall. The company plans to spend $3 billion of that buying back its stock, leaving another $1.3 billion for acquisitions or other investments.

Morse also filled a leadership gap at Yahoo after the abrupt firing of Carol Bartz as its CEO a year ago. Bartz had hired Morse to weed out expenses.

After Bartz's ouster, Morse served four months as Yahoo's interim CEO until the company hired Scott Thompson in January. Thompson lasted just four months before he stepped down amid an uproar about inaccurate information on his official biography.

Besides bringing in a new CFO, Mayer last month hired former Amazon.com Inc. executive Kathy Savitt as Yahoo's chief marketing officer.



Loading Slideshow...
  • Timothy Morse

    Timothy Morse, Yahoo's interim chief executive and chief financial officer since July 2009. He is likely the backstop candidate to be the company's permanent CEO. Morse had been CFO at chip-maker Altera Corp. and held various financial management roles at General Electric Co. for more than 15 years. He is seen as a strong operator credited with improving operating profits at Yahoo, mainly through cost-cutting, even as revenue at the company fell. His solid financial background and Silicon Valley experience could be an asset if major strategic moves are pursued, although he could be seen as damaged goods because Bartz had hired him.

  • Ross Levinsohn

    Ross Levinsohn, Yahoo's executive vice president for the Americas. Levinsohn joined the company in October 2010 from Fuse Capital, a digital media and communications investment fund that he co-founded and led as managing director. As a strategist, he helped orchestrate News Corp.'s purchase of Myspace in 2005, an acquisition that ultimately failed. He is seen as well connected in the world of new media. "He's probably learned from his mistakes about what he did at Myspace," B. Riley & Co. Inc. analyst Sameet Sinha said. For now, Levinsohn is serving on an executive leadership council that is advising Morse, so it's a short step up to the top job.

  • Jonathan Miller

    Jonathan Miller, News Corp.'s chief digital officer since March 2009. He knows the Web portal business from his stint as AOL's chief executive from 2002 to 2006 and knows Levinsohn from their time co-founding Velocity Interactive Group, which became Fuse Capital. He should be busy trying to sell online video service Hulu, but it helps that Yahoo is one of the bidders. He knows when to cut losses, having helped sell the money-losing Myspace in June. He could also be instrumental to scoping out a Yahoo-AOL merger if the idea resurfaces.

  • Jason Kilar

    Jason Kilar, CEO of Hulu, which is being sold by its owners, News Corp., The Walt Disney Co., Comcast Corp.'s NBCUniversal and Providence Equity Partners. Kilar has helped Hulu become profitable and has innovated unique ad strategies that give viewers choices. He also helped launch the Hulu Plus paid subscription plan. If and when Hulu gets sold, Kilar may be up for a job with larger responsibilities, and he understands the challenges of selling ads online. The Harvard Business School grad also worked as an executive at Amazon.com Inc.

  • David Kenny

    David Kenny, president of online content delivery company Akamai Technologies Inc. Kenny joined Yahoo's board in April. He was chairman and CEO of digital advertising agency Digitas, a unit of ad agency giant Publicis Groupe SA, from 1997 to 2008 so he understands the Web advertising economy. Although he isn't on Yahoo's executive leadership council, he is a member of Yahoo's board and will be involved with major strategic decisions.

  • Tim Armstrong

    Tim Armstrong, CEO of AOL Inc. He could be a candidate, but he runs a competing Web portal that has problems of its own. AOL has been slashing staff and recently bought The Huffington Post to boost its audience. TechCrunch, another recent AOL purchase, may see the departure of its founder Michael Arrington, who is starting up a venture capital firm. Besides needing to reverse losses at AOL, Armstrong has plenty of strategic challenges to overcome before moving on.

  • Peter Chernin

    Peter Chernin, former president and chief operating officer of News Corp. Chernin now runs Chernin Entertainment, which produced "Rise of the Planet of the Apes" for 20th Century Fox, the studio he once oversaw. Although Chernin certainly has operational management skills and vast experience in media, he's got a smash hit on his hands and a possible film franchise to manage. On a positive note, Chernin has looked into possibly taking over Yahoo with other investors, according to the Wall Street Journal's technology blog, All Things D.

  • Jack Ma

    Jack Ma, CEO of China's Alibaba Group. He is the dark horse who could take control of Yahoo and potentially snag the CEO job for himself. Ma has battled Bartz over his decisions and has chafed at Yahoo's 43 percent stake in his prized Internet company. "Jack Ma has not made it a secret that he really wants that stake back," Susquehanna Financial Group analyst Herman Leung said. Alibaba's market capitalization of $27.5 billion dwarfs Yahoo's of about $17.2 billion, making some kind of stock swap purchase possible with the help of private equity funds, Leung said. Ma could buy all of Yahoo to get back the Alibaba stake and sell the rest of the portal "at cost or at a loss," Leung said.