Yeast metabolizes sugar by splitting the six-carbon sugars into two molecules of pyruvate, then splitting the pyruvate molecules by removing carbon dioxide from them, and finally adding hydrogen ions to create ethanol molecules. This process is known as fermentation, and it is performed in the absence of oxygen.
Yeast produces energy by fermenting sugar molecules, but this process is very inefficient compared to cellular respiration using oxygen. Nonetheless, it allows yeasts to survive where many other organisms could not. Yeasts use fermentation when possible, even when oxygen is available. The process of ethanol fermentation is the way alcohol is created in alcoholic beverages. Yeasts and many other organisms produce ethanol and carbon dioxide as the final waste products of fermentation.
Other organisms use different types of fermentation, which also do not require oxygen but create different waste products. Another very common type of fermentation is lactic acid fermentation. This type of fermentation is performed by many types of bacteria, as well as by animal muscles in the absence of sufficient oxygen. This is the type of fermentation that bacteria use to convert milk into yogurt. Some bacteria create lactic acid, but also further process some of the lactic acid into ethanol, thus creating both waste products.