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Before IPO, AOL plans up to 1,000 layoffs

Views 0 Views    Comments 0 Comments    Share Share    Posted 12-11-2009  
Bangalore: As AOL prepares for its initial public offering (IPO), the internet company plans for another restructuring which could cost over $200 million and it also plans to lay off about 1,000 of its 6000 employees, with 100 layoffs planned this week.

Despite new leadership under CEO Tim Armstrong, AOL is yet to turn around financially. Last quarter, revenues dropped 23 percent to $777 million, reports TechCrunch. The biggest fall came from subscription revenues to its legacy internet access business, down 29 percent, but advertising revenues also took a hit, down 18 percent. AOL depends on display advertising, which has not yet rebounded like search advertising appears to be doing.

By cleaning up house and removing as many costs as possible before the IPO, Armstrong is trying to make AOL as lean as possible. But eliminating salaries and benefits can only go so far. He has to show that his new content strategy can create actual growth as well.

Source:
http://www.siliconindia.com/shownews/Before_IPO_AOL_plans_up_to_1000_layoffs-nid
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