Intuit pares staff
Slowed growth in Quicken sales and waning need for technical support means 270 layoffs worldwide for Intuit.
The cuts will affect the company's U.S. technical support operations, as well as its European operations. It will hire contractors to handle its European technical support and will consolidate its three European operations.
The cuts represent nearly 10 percent of 3,000 workers worldwide; the bulk will take effect before August 29, when a tech support center in New Mexico will close. Details on the restructuring charge will not be released until the company reports its fourth-quarter results in the late summer or early fall.
"Our growth is lower than in past and driving that has been our Quicken sales, which have been slowing," said Bill Harris, executive vice president. "So, in a sense, some of these moves are related. We feel we can reduce the size of our tech support since we have slower growth in our Quicken sales."
Harris said the reduced need for tech support also is the result of newer products requiring less help to use, as well as the emergence of the Internet as a distribution means for its software. Harris said that delivering software via the Internet has required less technical support than did customers receiving and installing disks.
Intuit reported revenues of $136.3 million in the third quarter, virtually flat with $136.5 million in the year-ago period. Its earnings, meanwhile, were $500,000 for the quarter, compared with a loss of $300,000 the previous year.
Harris said the company does not anticipate major growth increases, but notes that Wall Street has been forecasting growth of between 10 to 20 percent for the company.
Under the restructuring plan, three marketing and technical support offices in Munich, London and Paris will be consolidated into Germany, eliminating 70 jobs.
Less than 50 people will be cut from a variety of departments in Northern California operations. The bulk of the cuts will occur in New Mexico, where it operates a technical support office. The New Mexico plant closure will affect 300 workers, but 150 workers will be eligible to transfer to the company's Tucson, Arizona, technical support center.
The last large round of layoffs occurred in May, when the company announced it would sell its Parsons Technology unit to Broderbund (BROD). That resulted in about 100 layoffs, Harris said.