Yahoo shakes up management amid shareholder unrest

Some of the departing executives also may have been unhappy with the way their duties would change in the reorganization.

"When you go through something like this, you have to be prepared for some short-term dislocation for long-term benefit," Decker said.

Although he remains in charge, Yang might not be CEO much longer if he can't placate Yahoo shareholders still upset about the company's rejection of Microsoft Corp.'s $47.5 billion takeover offer.

Investors apparently weren't impressed with Thursday's shake-up. Yahoo shares fell 64 cents to finish at $21.37.

Yang is the focal point of shareholders' wrath because his prickly relationship with Microsoft CEO Steve Ballmer culminated in the withdrawal of the software maker's last oral offer of $33 per share. That offer was 72 percent above Yahoo's stock price before the bidding began.

The final straw came May 3 when Yang demanded $37 per share, a price that Yahoo's stock hasn't reached in nearly 2 1/2 years.

To make matters worse, Yahoo's market value has dropped nearly $10 billion, or 24 percent, since Yang replaced Semel as CEO a year ago.

Also complicating matters, Yang pushed for an employee severance plan that would cover all 13,800 of Yahoo's employees if the company is sold. Because the plan promises unusually generous payments to all employees who are fired or involuntarily reassigned to another job after a takeover, many Yahoo workers may be disappointed that a sale to Microsoft wasn't consummated.

With Microsoft out of the picture, the employees who were hanging around in hopes of collecting a rich severance package now have more incentive to look for another job.

Yang has promised that Yahoo is on the verge of a turnaround that will accelerate the company's revenue growth, but the projections have been met with widespread skepticism on Wall Street.