REDWOOD CITY, Calif. -- In a further effort to cut costs amid a slowdown in the online advertising market, Excite At Home plans to close its media operations in France, Germany and Spain and focus on its European operations in the United Kingdom and Italy.
The Internet-service provider said Wednesday it will shut down Excite-branded Web sites and local operations in France, Germany and Spain, along with Web sites operated from the European headquarters in London but directed to other markets.
Excite (ATHM) blamed a slump in European Internet advertising for its decision to close the operations.
The European closings won't affect its U.K. and Italian portal operations, which include a 58% stake in Excite UK Ltd., a venture with British Telecommunications PLC (BTY), or its 30% stake in Excite Italia, a venture with Tiscali SpA.
The closings also won't affect @Home Benelux, its broadband Internet venture with Essent Kabelcom BV, or its portal joint ventures in Japan and Australia.
Excite said despite the advertising downturn in Europe, it still believes that Excite UK and Excite Italia will continue to grow.
Excite's core business is delivering high-speed, or broadband, Internet access over cable-television lines. Its media business, which includes the Excite Web portal, is the source of the company's weakness.
As with most companies with media interests, Excite has been hurt by the economic slowdown. In April, the company laid off 380 employees, or about 13% of its work force. Those cuts followed an 8% work force reduction in January as the Internet concern looks for ways to cut costs in order to preserve cash. Excite has said it is looking for ways to raise an additional $75 million to $80 million in cash by the end of the second quarter.
However, the company has said it expects narrower operating losses during the second half of the year. The mean estimate of analysts surveyed by Thomson Financial/First Call is for a 2001 loss of 46 cents a share on revenue of around $753.5 million.
For 2000, Excite reported a net loss of about $7.44 billion, or $18.73 a share, on revenue of about $616.4 million.