The move follows the appointment of former Google engineer Marissa Mayer as its CEO in July.
Mayer says de Castro’s experience in internet advertising and his “proven success” in structuring and scaling global organisations make him a perfect fit for Yahoo! as it looks to propel the business back to growth.
Most recently de Castro was vice president of Google’s worldwide partner business solutions group, responsible for the advertising and platform services the company offers to its publisher and commerce partners.
Prior to that he led Google’s media, mobile and platforms division.
He has also held operational and consultancy roles at Dell and McKinsey & Company respectively.
De Castro’s appointment will come at a cost for Yahoo!, which will pay him an annual salary of $600,000 (£373,000) and offer him performance based stock options worth up to $56m (£35m) over four years, according to his employment offer letter filed with the US Securities and Exchange Commission. It emphasises his importance to the company, which is looking to steady the ship after a series of high profile departures and the ground it has lost to its rivals in search and email.
He will also be responsible for building out Yahoo!’s ad platform as it looks to better compete with display giants such as Google and Facebook. Yahoo’s share of the US online advertising business is expected to drop to 7.4 per cent this year, less than half the share it was at in 2009, according to Emarketer.
De Castro will join Yahoo! by the end of January 2013.