Jupiter Cuts 80 Staff, Reduces Revenue Forecast
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The softening economy has hit market intelligence and research firm Jupiter Media Metrix Inc. which announced lowered expectations on fourth quarter revenues and layoffs of 80 staff members.
The job cuts represent about an 8 percent reduction in staff levels across the board and include six analysts within the Jupiter research division and six sales representatives, the company said during a conference call. The reduction is expected to result in a $5 million charge.
Company officials said revenues are expected to be between $38.2 and $38.5 million (excluding amortization, 22 to 23 cents per share loss) compared to expectations of between $39.5 million and $42 million. Jupiter was expecting a loss of 1 cent per share. Full results are slated for Feb. 8, after the market closes.
"The weaknesses were in new contracts much more than in (contract) renewals in traditional segments," said Tod Johnson, chairman and chief executive officer. In the third quarter, "we really saw many more of the dot-com or new media type companies literally going out of business" which represented a slip of about 1 percent per month from the client base.
In addition to the softening outlook on the economy, which left the company with expenses based on higher growth rates, costs associated with the Jupiter Media Metrix's international expansion also proved to be higher than expected. Also trimmed were seven conferences from the roster, bringing the total conferences to 25 for the year.
In hindsight, the completion of the merger of Jupiter and Media Metrix wasn't exactly on the company's side, and as a result of lowered revenue forecast, the company said it had to look for redundancies.
One plus one can equal one-and-a-half in merged companies, added company officials. Gene DeRose, vice chairman and chief operating officer, said now is a good time to find a lot of those synergies.