Yahoo announced Monday that its co-founder Jerry Yang is replacing Terry Semel as Chief Executive Officer of the Internet portal giant, which has been struggling with aggressive competition from rival Google.

In a statement released after the stock market closed, the Silicon Valley company said Yang will take its day-to-day management while Semel will assume the position of non-executive chairman.

Semel, a former Hollywood executive whose stints included management positions at Warner Bros. and Walt Disney Co., joined Yahoo in 2001 and helped the company turn around after the dot-com crash.

But he came under fire in recent weeks as Yahoo's annual shareholder meeting approached, mainly due to the company's poor performance compared to Google and his own relatively generous pay package. Yahoo's shares have fallen roughly 10 percent in the past year, while Google's have risen more than 30 percent.

Yahoo also announced that Susan Decker, former head of its advertiser and publisher group, has been named president of the company.

"This is the time for new executive leadership, with different skills and strengths, to step in and drive the company to realize its full potential," said Semel in a statement.

Yahoo investors began publicly questioning Semel's leadership last year when the company's stock continued to fall as Google's soared.

Jerry Yang, a Stanford graduate, co-founded Yahoo in 1995 with David Filo. He said in a statement Monday that he was delighted to assume the leading role at the company that he helped start 12 years ago.

Analysts said Yang, who understands Internet technology much better than Semel, could help Yahoo in its race for market shares in such areas as web advertising, video sharing or social networking against archrival Google and numerous Internet startups.