San Francisco: Google Inc's Marissa Mayer will become Yahoo Inc's new chief executive, a surprise pick for its third CEO in a year.

Mayer's hiring, edging out front-runner and acting CEO Ross Levinsohn, helped push its shares up 2 per cent to $15.97 in after-hours trading.

Yahoo said Mayer would assume her role on Tuesday, when the company is scheduled to report its quarterly financial results.

Mayer, one of Google's earliest employees, was the Internet search company's first female engineer and has led various businesses at Google including the design of its flagship search engine and its location and local services business.

Yahoo had been widely expected to go with Levinsohn, who in his few months at the helm tried to push a strategy of forging media partnerships to beef up the company's online content.

A source close to the situation said that Mayer, who is recognized in Silicon Valley as more focused on technology than content, will try to get Levinsohn to stay with the company.

Mayer's appointment caps a tumultuous year at Yahoo. In May Scott Thompson resigned as CEO after less than 6 months on the job after a controversy over his academic credentials.

Thompson had replaced controversial Carol Bartz, who was fired in September after failing to revitalize Yahoo.