Yahoo’s shares shot up after the struggling internet company fired its chief executive Carol Bartz.
In a message to Yahoo employees Bartz said Chairman Roy Bostock dumped her with a phone call.
Bartz had failed to turn around the company which is losing market share to Google and Facebook.
During her tenure, which started in January 2009, there was also a falling out with Yahoo’s Asian partner Alibaba, in which it has a 40 percent stake.
Chief Financial Officer Tim Morse will take over for now as the search starts for a replacement.
Yahoo said a new executive leadership council would help Morse in managing day-to-day operations as well as supporting “a comprehensive strategic review” to position the company for growth.
Some analysts said Bartz’s departure signalled the company had run out of options after failing to dominate the advertising and content markets and handing over its search operations to Microsoft.
That partnership, under which Microsoft handles search for Yahoo’s websites and keeps a portion of ad revenue, appears to favour the software company at Yahoo’s expense.
“It’s hard to say what direction they are going to head. What is the next step for Yahoo? They went down the road of search, they went down the road of media, becoming a content company, they went down the road of advertising,” said YCMNet Advisors CEO Michael Yoshikami.
“I’m not sure where they go right now. One wonders if this means that they might be ripe for a takeover.”