Yahoo, Inc. (NASDAQ: YHOO) is most likely looking to shed hundreds (if not thousands) of jobs next week, as the company reports Q4 earnings. Yahoo! CEO Jerry Yang will seek to appease short-termers (i.e., Wall Street) by making moves to cut expenses, but will that really help the company move forward in its battle against the competition? After all, can Yahoo! ever catch-up to competitor Google, Inc. (NASDAQ: GOOG), regardless of the actions it takes?

Yahoo! is certainly profitable -- just not nearly as much as Google is. The shining star of both companies right now is advertising. Yahoo! has a great non-search ad revenue stream coming in, while Google receives almost all of its cash from text search advertising. With Google garnering so much profit-heavy revenue, I would assume Yahoo! would also want to grow rather than shrink. Yahoo! is not in any profit trouble -- it just seems that way since Google outshines it at every possibly juncture. What could Yahoo! do to grow more? Well, isn't the modus operandi of many corporate leaders wanting instant gratification growth by acquisition or merger?

What could Yahoo! do instead of taking out employee costs to raise its profit profile? How about putting some muscle into the recent acquisitions of BlueLithium and Right Media. Yang says that Yahoo! must find out what people do during the day and ensure the My Yahoo! homepage ties into those activities. Exactly what did former CEO Terry Semel do for years, must I wonder? If it's 2008 and Yahoo! still does not know what its customers do while on its properties, then the only way it will grow will be to turn those acquisitions into cash cows, since it apparently does not have a firm line on why its customers use its sites.

Yahoo, Inc. (NASDAQ: YHOO) will report its fiscal year come January 29, and along with probably reporting a profitable, but slow-growth year, the company may also announce employee cutbacks at the same time. Yahoo!, which has about 14,000 employees, may be looking to shed itself of 1,500 to 2,500 of them.

This may be a way to pacify the investment community, which has very little patience for Yahoo!'s financial results after consistently losing revenue market share to Google, Inc. (NASDAQ: GOOG). Additionally, many are upset about the huge pay package former CEO Terry Semel received after leading the company to quarter after quarter of disappointing results.

Although one source indicated the number of potential Yahoo! layoffs would be in the thousands, a number set in the hundreds was indicated by another source. One thing is for sure -- Yahoo! is most likely set to announce some kind of headcount reduction in the next week or two. Since 2006, the company has grown from 11,600 employees to more than 14,000 today -- an over 23% growth. At the same time, share price has declined from near $35 to a little over $20 today. It's doubtful that YHOO shares will rise during the rest of this month seeing as the massive decline in the market is happening this morning (and will continue for the remainder of the month most likely).

Still, Yahoo!'s Q4 revenue growth is being estimated at 15%, something that can be looked at as a large positive. However, Yahoo!'s CEO Yang will continue to feel pressure to cut more costs in the short erm, and that means layoffs are in order soon unless the company can pull something significant from its magician's hat.