Following up on earlier job cuts, Menlo Park, Calif.-based Egghead.com Inc.
in a move that the CEO referred to as “right-sizing” the company.
The troubled Internet retailer of computers, software and other technology
products, which at one-time was a chain of real-world stores, cut 77 jobs
last month.
Its stock has been under $1 a share for some time and today was down almost
10 percent after the news came out, to 59 cents in mid-afternoon trading.
Egghead said today’s across-the-board reduction in staff affects 21 workers
in the company’s Menlo Park offices and 157 full-time, temporary and
contract workers from its Vancouver, Wash. facilities, including a number of
senior and mid-level managers.
“Today’s announcement reflects the company’s ongoing commitment to
right-sizing the business,” said Jeff Sheahan, president and CEO of
Egghead.com. “2001 is proving to be a challenging year for most
technology-related businesses, and we are positioning ourselves to stay ahead
of changing business conditions. Right-sizing is critical in today’s market,
especially as we continue our march toward reaching profitability this year.”
Formerly a B2C company, Egghead now is focused on the Small- to Medium-sized
Business (SMB) community.
“As we’ve gained experience with our B2B business model, we’ve developed a
better understanding of what our outbound organization should look like and
are adjusting the profile of that organization to better penetrate and
service our Small- to Medium-size Business customer base,” Sheahan said.
Egghead in March beefed
up its senior management team — adding a new chief financial officer as
well as a senior VP for marketing. It also snagged a $20 million credit line
from International Business Machines Corp.