Yahoo Chief Executive Officer Carol Bartz was fired Tuesday by the technology company's board of directors because she could not put the site back on top of its rivals Google and Facebook.

The 62-year-old Bartz was informed of her removal only by phone.

Bartz, who was former chief executive of software firm Autodesk, e-mailed Yahoo employees to announce her ouster.

"I am very sad to tell you that I've been fired over the phone by Yahoo's Chairman of the Board," technology blog AllThingsD quoted Bartz's e-mail.

Following the board's decision, Yahoo named Chief Financial Officer Timothy Morse as temporary replacement for Bartz until the board finds a permanent one. Yahoo also put in place an Executive Leadership Council tasked with the holding of a comprehensive strategic review of the firm based in Sunnyvale, Calif.

Evercore Partners analyst Ken Sena opined that Yahoo fired Bartz in response to stockholders' frustration over her failure to prevent the shift of Internet users and advertising income from Yahoo, which was once on top, to Facebook and Google.

"It shows some accountability for the dissatisfaction that investors have felt over the last few years... The turnaround efforts have not worked and trends seem to be getting worse. I see this as a positive step," Sena told Bloomberg.

Yahoo, nevertheless thanked Bartz for her service for heading the company since 2009 at a critical point of transition in its history and amid very challenging times.

"The board sees enormous growth opportunities on which Yahoo can capitalize, and our primary objective is to leverage the company's leadership and current business assets and platforms to executive against those opportunities," Chairman Roy Bostock said in a statement.

During Bartz's leadership, Yahoo's stock gained 6.7 per cent, while the average increase for Standard & Poor's 500 index was 34 per cent. Prior to the announcement of the leadership change, Yahoo's shares went up 4 cents to $12.91 on Tuesday at the Nasdaq stock market after it suffered a 22 per cent decline since January.

In her almost three years stint as Yahoo CEO, Bartz attempted to improve the company's financial performance by axing jobs and entering into a partnership with Microsoft. But her efforts failed to stem the hemorrhage of online advertisers as Yahoo's market share is expected to contract to only 9.7 per cent in 2012 from 16 per cent when Bartz took over.

Yahoo used to be a $80-billion company, but its share of the online advertising pie continuously shrank while that of Google is expected to go up 45 per cent and Facebook to 7.8 per cent.

It is the third CEO replacement for Yahoo in a span of four years. Despite her known no-nonsense leadership style and long Silicon Valley experience, Bartz's weakness apparently is her lack of experience in Internet advertising, which used to be Yahoo's cash cow.