Yahoo (YHOO) shares fell Tuesday after the company reported its fourth quarter results and announced a strategic plan to simplify the embattled Internet firm.

WHAT’S NEW: Yahoo reported Q4 earnings per share of 13c, in line with analyst expectations of 13c, and revenue of $1.27B, against consensus estimates of $1.19B. Yahoo also reported Q4 display revenue was up 13% year-over-year to $601M, while gross search revenue was down 7% to $866M. The company indicated that the number of ads sold during the quarter rose 8%, while price-per-ad increased 6% and paid clicks fell 10%. The company also provided first quarter and fiscal 2016 guidance, forecasting Q1 adjusted operating income of ($50M)-($30M) and revenue of $1.05B-$1.09B under Generally Accepted Accounting Principles, against consensus estimates of $1.14B. The company expects FY16 operating income of $150M-$250M and sees yearly GAAP revenue of $4.4B-$4.6B, against consensus estimates of $4.78B.

WHAT’S NOTABLE: Yahoo announced it will pursue a reverse spin of its stake in Alibaba (BABA) alongside an “aggressive” strategic plan to simplify the company. Yahoo plans to reduce its workforce by roughly 15% and exit five offices in Dubai, Mexico City, Buenos Aires, Madrid and Milan. The company also announced it will simplify its product portfolio to emphasize the products that “distinguish the company competitively” and drive the most substantial portion of users, revenue, and market opportunity. It plans to shift most of the resources in its search business toward more forward-leaning mobile search investments, positioning it to “redefine” search for mobile devices as it seeks long-term growth and differentiation. Yahoo noted it will continue to invest in its Mavens strategy to counterbalance legacy business declines, with an emphasis on mobile. In the earnings release, Yahoo’s chairman Maynard Webb commented, “The board believes that exploring additional strategic alternatives, in parallel to the execution of the management plan, is in the best interest of our shareholders. Separating our Alibaba stake from our operating business continues to be a primary focus, and our most direct path to value maximization. In addition to continuing work on the reverse spin, which we’ve discussed previously, we will engage on qualified strategic proposals.” Separately, the company disclosed in a regulatory filing that Charles Schwab gave notice he was resigning from Yahoo’s board of directors effective February 2.