Software-maker CA to slash jobs, close offices

Business software-maker CA is closing offices and cutting 1,000 jobs, about 8 percent of its staff, to cut costs.

Though the market for tech companies is supposedly starting to improve, at least one software developer is still struggling.

Business software maker CA is planning to cut 1,000 jobs, about 8 percent of its staff, in an effort to trim costs and become leaner, according to a filing Tuesday with the Securities and Exchange Commission. Formerly known as Computer Associates, Islandia, N.Y.-based CA will also close, consolidate, and merge certain offices as part of its cost savings strategy.

As a result, the company expects to spend around $47 million before taxes in the fourth quarter on severance packages and office consolidations. Most of the layoffs will affect staff in North America, but some will hit other countries as well. Many of the layoffs will be done by the end of April, with the rest completed by the end of the second quarter in September.

CA, which specializes in IT management software, also expects to show weaker financial results for this year. Though recent third-quarter earnings were better than expected , CA now believes results for the full year will be at the lower range of its prior forecast of $1.60 to $1.71 per share.

In a memo sent to all employees Tuesday morning, CA Chief Executive Officer Bill McCracken explained the reasons for the layoffs and office closings.

Pointing out that the industry and market are changing, McCracken said that CA has to change as well. The company is retooling its product line and R&D investments to focus on more profitable areas, said McCracken. Businesses and operations will be streamlined to make the company more efficient. And closing or merging offices will help cut real estate costs.

"I recognize that the actions we're taking are difficult. But in the end, they will make CA stronger and more competitive," said McCracken in the memo.

About the author

Journalist, software trainer, and Web developer Lance Whitney writes columns and reviews for CNET, Computer Shopper, Microsoft TechNet, and other technology sites. His first book, "Windows 8 Five Minutes at a Time," was published by Wiley & Sons in November 2012.

 

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