SeaChange Lays Off 30
VOD Equipment Provider Cuts 4% of Employees to Reduce Costs
By Todd Spangler -- Multichannel News, 8/30/2007 11:01:00 AM
SeaChange International laid off 30 employees, or 4% of its work force, in its quarter ended July 31 to reduce costs, the company disclosed in announcing earnings Thursday.
The company, which provides video-on-demand software and hardware solutions, incurred $1.1 million of severance costs in connection with the headcount reduction. The layoffs were spread among manufacturing, service, general and administrative and engineering personnel, according to SeaChange, with the broadband segment’s VOD server group incurring the majority of the headcount reductions.
The Acton, Mass., company posted revenues of $44.2 million for the quarter ended July 31, down 3% compared with $45.8 million for the same period last year. Net loss for the quarter was $8.0 million, which included $6.0 million of one-time charges including severance-related costs, compared with net profit of $959,000 in the year-ago period.
In addition to severance costs, SeaChange recorded $4.6 million in charges related to capitalized software licenses, as well as $300,000 related to write-downs of selected fixed assets and inventory. The company expects the cost-cutting measures to save $1.5 million per quarter, beginning with its third fiscal quarter.
SeaChange president and CEO Bill Styslinger said in a statement that the cutbacks “[enhance] our ability to achieve sustainable profitability.”
Styslinger noted that VOD systems sales picked up in the quarter, with revenue more than doubling sequentially to $12.4 million in the quarter compared with $5.4 million in the prior three-month period.
“The strength in VOD systems revenue from our North American cable customers that drove our record revenue performance last year has returned,” he said. “We not only saw that strength in the second quarter but orders booked thus far in the third quarter show this trend is continuing.”
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