More than once really (I'd say Tormato was the first time and the 2 yesses Union fiasco in the late 80s/early 90s was the second time). And they've managed to come back from it. So I wouldn't count them out permanently. I could see a series of circumstances occurring where they could get good again. It won't happen without drastic changes though. If I were playing the fixer-upper here first I'd ditch Davison and bring back Anderson (obviously), second I'd get rid of Downes and bring in pretty much anybody I don't really care who since Yes keyboardists are kind of interchangeable (not Wakeman though, while his playing hcops are more or less still intact his taste in keyboard sounds isn't much better than Downes). It would hurt but I would have to give Howe the boot too since his playing was so bad on this album as were his writing contributions and his only contributions to Fly From Here were among the weakest spots on that album too (Bumpy Ride & Hour Of Need) so his time has clearly past. I hate to say it but unless they want to bring in someone completely new their only choice would be to bring back Trevor Rabin. His guitar-work has been much criticized but lets be honest here, at this point in Yes's career he would be a much more tasteful player and his creative side is still intact since he's spent most of his time post-Yes scoring films. And lastly I'd also give White the boot since he can't play for shit anymore (this is probably the least likely thing to happen though since it seems like he and Squire are attached at the hip). Replace him with someone young and fresh.
Squire can stick around cus his skills haven't seemed to have significantly diminished as long as he's got good people to play with.

So from that it looks like what I'm basically saying is that the only way Yes could be competent again would be to fire 80% of the current lineup and bring back the 90125 lineup. OR just bring Anderson back and give him dictator levels of control over the band's direction.