RealNetworks Cuts 15 Percent of Workforce
In a sign that no company is immune to the economic downturn, RealNetworks (www.realnetworks.com) announced on Thursday that it was reducing its workforce by 15 percent and instituting cost-cutting measures.
Approximately 140 people out of 950 would be let go. RealNetworks said it was offering employees benefits and outplacement services.
"I regret that the economic slowdown has required these changes, and I want to thank our departing employees for their dedication and service," said Rob Glaser, chairman and CEO of RealNetworks, in a statement.
Glaser said the company's overall mission is unchanged. "We are refocusing and rebalancing our resources to invest in long-term growth," he said. "After we adjust our cost structure, it's absolutely our intent to resume our track record of pro forma profitability and positive cash flow."
Just last week, RealNetworks revealed its second quarter results, which were below Wall Street's expectations. Net revenues for the quarter were $47.9 million, with pro forma net earnings for the quarter at $2.4 million. Investment banks Pacific Crest and Wedbush Morgan downgraded their recommendations.
According to the company, it will take a $4-5 million charge during the third quarter to reflect costs.
RealNetworks also said that its GoldPass subscription surpassed 300,000 subscribers. GoldPass was launched in August 2000, and includes content like exclusive Major League Baseball, NBA programming and the live video streaming from the "Big Brother 2" house.