EarthLink to lay off 1,300 workers
Will close four facilities beginning in February
By Rex Crum, CBS.MarketWatch.com
Last Update: 4:35 PM ET Jan. 28, 2003
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ATLANTA (CBS.MW) -- Internet service provider EarthLink on Tuesday said it would cut 1,300 jobs, or 25 percent of its total workforce, as part of the closure of call centers in Dallas, Seattle and Sacramento, and one customer and technical support facility in Pasadena, Calif.
EarthLink (ELNK: news, chart) officials said the moves are part of an effort to streamline call-center operations and would result in a $20 million annual savings in operational expenses. The company expects to record a facility-exit charge of $41 million in its first quarter as a result of the closures.
Garry Betty, EarthLink's CEO, said the closures are needed to help improve the company's financial performance and "better compete in a rapidly changing marketplace."
EarthLink said the closures would begin Feb. 21 and be completed within 30 days. The company expects its remaining call centers in Atlanta, Harrisburg, Pa., and Roseville, Calif., to handle the responsibilities of the closed facilities.
The closures follow the shuttering last year of an EarthLink facility in Phoenix.
EarthLink's shares rose 31 cents, or 5 percent, to close at $5.97.
Rex Crum is a reporter for CBS.MarketWatch.com in San Francisco. |
