NBCi Falls Short, Lays Off 150
By Steve Donohue -- Multichannel News, 1/18/2001 9:20:00 AM
NBC Internet Inc. said Thursday that it will cut 150 employees, representing about 30 percent of its work force.
The company -- which has seen the value of its stock plummet 96 percent in the past year -- also said it is reducing its revenue projections for 2001 from $150 million to $100 million.
NBCi CEO Will Lansing said the company still expects to turn a profit by the first quarter of 2002. 'But to reach this goal, we needed to make difficult decisions on the operational side of our business to account for the challenges within the online-advertising market,' he said in a prepared statement.
The cuts will come from all areas of the company, NBCi said.
Shares in NBCi closed at $76 on Nov. 30, 1999, the day of its initial public offering. The company was formed through the combination of NBC and CNET's Snap.com, Xoom.com, NBC.com, NBC Interactive Neighborhood, Videoseeker and a 10 percent equity stake in CNBC.com.
The company's stock broke $100 per share last January, but it has been on a steady nosedive since then. Shares in NBCi had fallen 4.48 percent to $4 each by 2 p.m. Thursday, following word of the layoffs and revenue shortfall.
NBCi has gone through several management and branding overhauls since its debut. When it first launched, nbci.com was simply a corporate Web site that contained information about the company, including a graphic at the top of the page that displayed the current price of the company's stock. It relied on its xoom.com and snap.com commerce and search-engine sites, but later folded those sites into nbci.com, hoping to leverage the NBC brand.
Ads and promotions for the Web site have become ubiquitous on NBC properties in recent months.
The company said Thursday that it will release more details about the cost reductions and revenue projections Feb. 7.
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