Evoke Communications (Nasdaq: EVOK) sees better-than-expected fourth quarter results, plans to cut 35 percent of its workforce and seeks a new CFO.
After market close Tuesday, the provider of conferencing and collaboration services said it expects to report fourth quarter net income and revenue ahead of analyst estimates. First Call consensus predicts a loss of 36 cents per share on revenue of $7.52 million for Evoke's December quarter.
Shares of Evoke traded at 2.0937 in afterhours activity on the Island electronic communications network, following the announcements. Evoke was unchanged at 1.75 in Tuesday's regular trading ahead of the news.
The company unveiled cost-cutting moves that include cutting 112 jobs, leaving the company with a staff of 208. Other restructuring actions involve ending Evoke's Web voice chat service and its voice-to-email messaging, outsourcing webcasting to Digital Island (Nasdaq: ISLD), closing some field offices and cutting back on marketing programs with Excite@Home (Nasdaq: ATHM) and Terra Lycos (Nasdaq: TRLY).
Company executives expect to slash $25 million in operating expenses over the next year, with 75 percent of the savings coming from sales and marketing. Evoke plans to report a fourth quarter charge of $8.6 million to write off agreements with Excite@Home, with more write-offs in the first quarter related to employee severance and other restructuring costs.
Evoke said its cost cuts will lead to lower-than-expected losses on lower-than-expected revenue. The company now forecasts revenue of $36 million to $44 million, with a loss of $14 million to $18 million before interest, taxes, depreciation and amortization. About two thirds of that loss will come in the first quarter, the company said.
First Call consensus has been predicting an Evoke loss of $1.17 per share on 2001 revenue of $57 million.
Also Tuesday, Evoke said Terry Kawaja has resigned as chief financial officer. Kawaja will stay through a transition period, the company said.
"Terry's merger and acquisition skills were critical when our strategy was more acquisition focused," said Paul Berberian, president and CEO. "However, with the current market conditions, the company requires an operationally focused CFO to support our restructuring strategy."
Evoke's vice president of finance, Ken Mesikapp, will become acting CFO.>