iVillage.com (Nasdaq: IVIL) will cut more jobs over the next couple of months as it shoots to break even on apro forma basis in the third quarter of this year, executives of the New York City-based women’s Internet network said.
The “rightsizing” will include a reduction in the company’s workforce over the next 60 days to “somewhere fewer than 200 people” from the “high 300s”currently, said company officials on a conference call with investors late Thursday.
The job cuts will eliminate what the company called “redundant” jobs created by iVillage’s US$20million acquisition of Women.com. On Monday, iVillage completed the acquisition.
iVillage chairman and chief executive Doug McCormick said the combined company is ” the largest online destinationfor women.” According to McCormick, the site now reaches 20 percent of all women on the Internet, with the average user visiting twice a month for 20minutes.
“We call that involvement,” McCormick said.
iVillage, like other companies that depend on advertising sales, has been working to cut costs and diversify its revenue sources as the marketfor online advertising has slowed down. McCormick said the company will expand its efforts to charge for some services.
The company is also planning new ventures, includinga package deal offering Redbook magazine subscriptions and online content.
“We’re working on reducing reliance on advertising revenue directly,” McCormick said.
At the same time, McCormick downplayed the fallout in the online advertisingmarket. “The bashing that the Internet advertising business has taken hasgone way over the top,” he said, adding that the failures of other Internet companiesthat relied on ad revenue “have nothing to do with iVillage.”
iVillage recently escaped delisting from the Nasdaq exchange. It was able to keep its stock above the exchange’s minimum bid price of $1 for 10 consecutive days after receiving a warning in April.
In morning trading Friday, iVillage shares traded at $1.34, up 6 cents.The stock is down from a 52-week high of $9.06, but above its low of 38 cents.
The iVillage network includes iVillage.com, Lamaze Publishing and theNewborn Channel. As part of the Women.com acquisition, iVillage will get a$20 million investment from Hearst Corporation, which will also buy $15million to $21 million in advertising and production services from thecompany over the next three years.
Hearst publications, including Redbook, Cosmopolitan and Country Living, willmaintain Web sites on the iVillage network, the companies said.