Priceline.com announces layoffs, CFO departure

2 min read

Priceline.com did meet analysts' estimates in its third quarter but it sales slipped from the second quarter and it announced it will lay off 87 employees. Also, CFO Heidi Miller resigned.

In the quarter, Priceline.com (Nasdaq: PCLN) lost $2 million, or 1 cent a share, on sales of $341 million.

First Call Corp. consensus expected it to lose a penny a share in the quarter.

Ahead of the earnings report, Priceline.com shares closed up 66 cents to $6.84.

Company officials blamed sluggish airline ticket sales for the sequential revenue decline.

The $341 million in sales represents a 124 percent improvement from the year-ago quarter when it lost $12 million, or 8 cents a share, on sales of $152 million.

However, total sales fell 3 percent from the second quarter when it posted a loss of $1.6 million, or 1 cent a share, on sales of $352.1 million.

Company officials said it will lay off 87 of its 535 employees and take an unknown restructuring charge in its fourth quarter.

It also announced the resignation of CFO Heidi Miller.

"We appreciate the contribution that Heidi has made and respect her decision to pursue opportunities and apply her talents in a more established business environment," said CEO Daniel Schulman in a prepared release. "We know she is supportive of the long-term direction the company is taking and wish her the best in her future endeavors."

Bob Mylod, formerly the vice president of finance, will assume the CFO duties.

In the quarter, Priceline.com's customer base grew to 8 million users. Fifty-one percent of all sales were from repeat customers, up from 31 percent in the year-ago quarter.

Gross profit margins in the quarter jumped to 15.9 percent, up from 12.2 percent in the same period last year.

"While we are disappointed in our airline ticket sales revenue for the third quarter, we believe that the business made solid progress on several fronts," Schulman said.

Priceline.com shares moved as high as $104.25 in March before falling to a low of $4.13 in October.

Sixteen of the 22 analysts following the stock maintain either a "hold" or "sell" recommendation.

Analysts expect it to lose 6 cents a share in the fiscal year.