Computer security software firm RSA Security Inc. plans to lay off about 200 workers, or 17 percent of staff in a bid to put a cap on operating expenses.
The Bedford, Mass.-based company also announced it would restructure the business into three product divisions, a move that involves some changes at the management level.
RSA Security, which provides security software and hardware used to protect and manage network access, said the restructuring would lead to a charge of between $8 million and $10 million this quarter with the majority attributable to workforce reduction and facility costs.
The company said the workforce reduction would be completed in the U.S. this week and internationally as quickly as possible.
The belt-tightening comes as RSA Security has seen its stock price nosedive from last May’s 52-week high of $37.94 to around $7.15 during mid-morning trading Wednesday.
RSA Security, which has been the target of an SEC probe into certain trading in the company’s securities, said it would rejigger the business into three separate product units: an Authentication Products division; a Developer Solutions/Encryption division and a Web Access Management Products division.
The sales, marketing, and general and administrative functions would continue to operate as separate groups serving the entire corporation, the company said.
“With this new structure, we are putting our focus on security for Internet applications, especially Web-enablement, in line with the needs and future direction of our customers worldwide,” chief executive Art Coviello explained in a statement.
In direct competition with the likes of Entrust, VeriSign and Network Associates, said the new Authentication Products division would be led by senior VP Bill McQuaide and would include the RSA SecurID and RSA Keon product lines.
Vice president Victor Chang has been tapped to head up the Developer Solutions/Encryption division, which oversees the RSA BSAFE product line. It said the Web Access Management Products division would be run by senior VP Joe Uniejewski would include the RSA ClearTrust product line.
“We believe that to position RSA Security for future success we must re-invent ourselves as a more aggressive, product-focused organization,” Coviello said.