SAN FRANCISCO — Wall Street celebrated the planned demotion of Jerry Yang on Tuesday, sending Yahoo Inc.'s shares soaring on hopes that a new chief executive would entice Microsoft Corp. to buy some or all of the struggling Internet company.

SAN FRANCISCO — Wall Street celebrated the planned demotion of Jerry Yang on Tuesday, sending Yahoo Inc.'s shares soaring on hopes that a new chief executive would entice Microsoft Corp. to buy some or all of the struggling Internet company.

But investors tempered their elation, realizing that real change will be slow in coming as Yahoo searches for a leader amid the deepening financial crisis roiling the online advertising market.

"The new CEO is going to face the same challenges as the old CEO," said Colin Gillis, managing partner of Click Capital Research. "Just like the Obama administration, change will not come fast, and it will not come easy."

Investors and analysts would like to see a new regime that will take a more aggressive approach to solving Yahoo's festering problems. Yang has been widely criticized by investors not only for failing to sell Yahoo to Microsoft this spring, but also for not acting quickly enough to reverse its slide.

Most analysts agree that Microsoft, a distant third in the search-engine wars, is eager to snap up Yahoo's search business but probably won't try again to acquire the company outright. Microsoft, which bid as much as $33 a share for Yahoo earlier this year, had no comment Tuesday.

Sunnyvale-based Yahoo has not offered a timetable or a sense of what kind of leader it seeks other than to say it wants someone to take the company "to the next level."

Names already being floated include former AOL CEO Jonathan Miller, News Corp. President Peter Chernin, former Yahoo operations head Dan Rosensweig and Google Inc. Senior Vice President Tim Armstrong. Two board members are also in the mix: ex-Microsoft executive Maggie Wilderotter and former Nextel Corp. CEO John Chapple.

Yahoo's choice will be crucial to mapping its future. Picking a seasoned CEO would be seen as a sign that Yahoo plans to stick to its plan to turn around the company. Settling on an insider, either from its executive ranks or its board, would suggest it wants only an interim player to broker a deal.

The ideal candidate will be an outsider with knowledge and appreciation of Yahoo and a willingness to quickly make big decisions, Standard & Poor's analyst Scott Kessler said. "Yahoo needs someone completely different from who they have," he said.

Yang, who co-founded Yahoo with David Filo 13 years ago, took over as CEO 18 months ago from former Hollywood studio chief Terry Semel. His appointment was greeted by enthusiasm in some quarters and reservations in others. Critics argued that Yang didn't have the operational chops.

His effort to engineer a comeback was undercut by the financial crisis, which has prompted advertisers to curb Internet spending. Yahoo plans to cut at least 1,500 jobs early next month.

Yang hit his last roadblock this month when Google Inc. walked away from a search advertising partnership, which had been touted as a way to boost Yahoo's revenue and profits, to avoid an antitrust battle with the U.S. Justice Department.

Yahoo on Monday took the unusual step of announcing Yang's departure before a successor had been found. Yang, who will help recruit his replacement, will remain CEO until that happens. Then he will resume his advisory role as "Chief Yahoo."