Magic makes workers disappear
Troubled software maker General Magic cuts its workforce by 26 percent--the second wave of pink slips within four months.
"This step, although difficult, is necessary for us to sharpen our focus on the company's business strategy and maintain existing commitments with our partners," said Steve Markman, chief executive and president, in a statement yesterday. "[It] allows us to align our workforce with the exciting new opportunities in the Internet and network services markets, while continuing to provide support to our customers and developers for our existing products."
The move was also an effort to conserve cash, the company said.
Since Markman's arrival in September, the company has cut its workforce from 280 to 138, or 50 percent.
General Magic, which has been hit with widening losses and declining revenues, is pushing ahead its strategy to make the transition from a software to an Internet business.
Last year, the company suffered a blow when Sony killed its plans to use General Magic's Magic Cap operating system in its handheld computer device.
The company, after the market's close yesterday, also announced the delivery of the next release of Magic Cap for handheld devices.
But that failed to move the stock today. General Magic shares have fallen from around 4-3/4 a share in September to slightly under the 2 range today. The stock took a tumble following the third-quarter earnings release in October when the company posted a $12.4 million net loss.