RealTime IT News

Buy.com Fires 125 in Restructuring

Much troubled multi-category Internet retailer buy.com, which shed 10 percent of its staff Feb. 2, today said it is cutting another 125 jobs out of about 230 as it restructures in an effort to stop the financial bleeding.

The cuts will come at its Aliso Viejo, CA headquarters, the company said, adding that the layoffs are part of a restructuring plan designed to reduce cash operating expenses by about $29 million annually.

Buy.com said it expects to record a pre-tax charge of $32 million to $37 million in the first quarter. As part of the restructuring plan the company, which is selling its UK operation, also will get out of the golf business it acquired from BuyGolf.com, and close the company's sports store.

The company said that coupled with other actions already underway, today's efforts are expected to reduce the company's total annual operating expenses by $70 million.

"We had to make difficult decisions in order to advance our goal of becoming profitable while maintaining a leadership position in e-commerce," said James B. Roszak, buy.com's chief executive officer. "While we are taking the steps we believe are essential to being a long-term player in the e-commerce space, we are confident in our ability to continue to provide our customers with a superior shopping experience." about 44 cents a share.

The company's stock was up up 6 cents to almost 47 cents a share. At one time it traded as high as $33.

Buy.com has billed itself as "The Internet Superstore" and says it has nearly a million SKUs in a range of categories including computer hardware and software, electronics, wireless products and services, books, sporting goods and office supplies.

The company reported a fourth quarter 2000 pro forma loss of $27.3 million. The company earlier this month cut sales projections from more than $1 billion to about $600 million for this year. Buy.com said that because of the restructuring plan, it now will change that guidance, but no specifics were disclosed.

It is reportedly selling its UK operation to British department store chain John Lewis Partnership, which owns 25 department stores and 133 Waitrose supermarkets.