December 4, 2000 12:05 PM PST
DoubleClick trims staff after management shifts
The staff cutbacks, which represent less than 10 percent of the company's work force, are intended to align employees under new management, the company confirmed Monday. The Internet advertising network currently employs about 2,100 people internationally.
"We have always carefully managed headcount to assure our productivity outpaces our competitors," the company said in a statement. "The changes made today leave our employee base virtually flat over the course of the second half of the year. This makes us well positioned for 2001."
In the second quarter of this year, DoubleClick employed roughly 1,980 people. Two weeks ago, the company announced several management changes, including the promotion of Barry Salzman to president of global media.
The layoffs signal the widening effects of deflating online advertising sales as a result of dot-com closures and stringent market pressures. Concerns about the growth of online advertising have reverberated throughout the industry. Just last week, SG Cowen Securities analyst Scott Reamer lowered his revenue estimates for Web portal Yahoo and for DoubleClick in the fiscal year 2001, largely because of slowing online ad spending.
Even DoubleClick rival 24/7 Media said last month that it plans to lay off 200 employees by the end of the year and forecast slower growth in the fourth quarter
Shares of New York-based DoubleClick have lost more than 90 percent of their value this year, trading around $12 Monday. Shares have traded as high as $135.25 in the last 52 weeks.
Despite Wall Street's growing pessimism about companies dependent upon online advertising, researchers have predicted that the industry will continue to boom. In a recent report, Jupiter Media Metrix estimated that online ad sales will reach $11.5 billion in 2003, up from $4.6 billion in 1999.