Rumors began swirling online late on Thursday afternoon when high-tech blog , citing unnamed sources, reported that the online company is preparing to lay off 20% of its entire staff of about 14,000, or 2,800 people.

The company is not denying there are in the works, but is trying to temper the report. " is always evaluating expenses to align with the company's financial goals," Yahoo representative Dana Lengkeek told Computerworld by e-mail. "However, a 20% reduction in Yahoo's workforce across the board is misleading and inaccurate."

Speculation about layoffs at Yahoo comes just one day after reports surfaced that another Internet icon, , was getting ready to hand out 10% pay raises across the board at the beginning of the new year.

Once an Internet giant and pioneer, Yahoo has slipped into a distance in the hot search market, where Yahoo recently tossed out its own and formalized a to use Bing search for all of Yahoo's sites.

Last month, the Internet was abuzz with speculation that in buying Yahoo.