About 500 AOL employees, accounting for 5% of its workforce, are about to lose their jobs. Tim Armstrong, who’s CEO of the Verizon-owned company, disclosed the news to staffers today as he announced a restructuring to focus on two business units: Media, which will include Search and Communications, and Platforms.

“The changes we are making are about setting the company on a path to successfully operating in today and tomorrow’s reality,” Armstrong said in a memo, disclosed by Recode.

The company is still poised to grow next year, “especially in video and mobile,” he added.

Verizon hopes to complete its deal to buy Yahoo’s operating assets, though they’re bickering over the $4.6 billion price. Verizon wants to take that down by $1 billion after Yahoo disclosed that in 2014 a “state-sponsored actor” stole 500 million users’ information including names, passwords, email addresses, birth dates, and — in some cases — answers to security questions.

AOL added 1,500 positions this year from its acquisition of Millennial Media and a partnership agreement to take over Microsoft’s display, mobile and video ad sales business.

As a result “there are a number of areas that require consolidation to improve operations and limit the amount of hand-offs in our business processes,” Armstrong said in his memo.

Verizon CFO Francis Shammo told analysts last month that the company is “seeing strong demand from advertisers for AOL’s expanding programmatic capabilities and high quality data analytic tools.”

The Yahoo acquisition, he added, “will further expand our scale in the digital media space. This would place us in a unique position to serve unmet customer needs, participate in digital publishing and video and to monetize the content.”