Internet giant Yahoo is cutting 300 jobs - 10% of its workforce.

The dot.com is also trying to expand its non-advertising income and ensure more revenue from its 210m users.

The company told analysts that advertising should be no more than 50-60% of total revenues by 2004, down from 76% this year.

"There's nothing wrong with advertising revenue, but we will be quite diversified away from that," said Yahoo chief executive Terry Semel.

That means an increasing attempt to make subscription and transaction-based revenue from its user base, he said.

Strategic agreement

The news comes just 24 hours after Yahoo announced a deal with SBC Communications, the Western US phone giant, to develop a co-branded high-speed internet service

The agreement, which the firms said was a "landmark strategic alliance", could help it market more premium services, potentially including multimedia features such as music and movies.

The company is cutting 400 jobs in international and broadcast operations and middle management, but is hiring about 100 new staff in other areas.

The cuts follow a 365-job clearout earlier in the year. Yahoo currently employs about 2,900 people.

And it is also scrapping some of its services, including business-to-business, small business and lifestyle services.

The company is making the moves after recording a loss for the three months from July to September of $24.1m, on revenues which fell 40% to $166.1m.

Yahoo shares fell 1.38% to $15.