Its stock price having reached the negligible range, E-Stamp Corp.
said today it is “phasing out” its Internet postage product
line and will instead focus on its Web-based shipping and logistics solutions.
The company’s stock closed Friday at 28 cents, down from a 52-week high of
almost $45. After the news this morning, the stock doubled to 56 cents in
early trading.
As part of the change in focus, the company is cutting its staff by
approximately
30 percent, but did not say how many jobs that represents.
E-Stamp said it was the first company to receive Postal Service approval for
Internet
postage technology and the first company to offer Internet postage
commercially.
“The business reality of operating in a highly-regulated environment,
combined with the change in valuation models of Internet companies, were key
factors influencing our decision to phase out our postage business ” said
Robert Ewald, president and CEO of E-Stamp.
E-Stamp said it has partnered with French postal equipment maker Neopost
Online to encourage its postage customers to adopt Neopost’s Internet Postage
solution, called “Simply Postage.”
Over the past two quarters, the company acquired two logistics companies, and
Ewald said the “greater market opportunity is presented by our logistics
solutions, Digital Shipper and e-Warehouse.”
As of the end of the third quarter of 2000, E-Stamp said its cash and cash
equivalents totaled approximately $40 million.
The Internet postage business has not been an easy go for anyone; competitor
Stamps.com
laid off 240 workers in October, is trading at $3, down from a 52-week
high of $98.50. The job cuts came two weeks after Chief Executive Officer
John Payne and several other top execs all quit.