Excite to Cut 500 Jobs | Adweek Excite to Cut 500 Jobs | Adweek
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Excite to Cut 500 Jobs

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REDWOOD CITY, Calif. -- Excite@Home will eliminate about 500 jobs and close its MathLogic unit as it struggles to remain liquid.

The online-service provider said Tuesday it expects additional funding or further financial restructuring will be necessary to continue as a going concern.

Excite (ATHM) will cut staff over the next three months and MatchLogic, Westminster, Colo., will begin winding down operations. MatchLogic, Excite's marketing services subsidiary, should close by the end of the year.

The company said it will refine its portal service following closure of MatchLogic as it continues to slash operating costs.

This move is in line with the company's plans to focus on core broadband services, reducing online media and narrowband businesses.

The Excite.com portal will also refine its operations and continue to offer core applications and content, the company said. Support for @Home 2000, the software for @Home subscribers, will continue.

"Selling and reducing our narrowband media assets that do not contribute financially or strategically to the broadband access business is the right direction for our corporate viability," Patti Hart, chairman and chief executive, said in a prepared statement.

In mid-August, Excite and its auditor, Ernst&Young LLP, raised "substantial doubt" about the company's ability to continue operations in its current form. The company subsequently dismissed the auditor.

The company was dealt another blow earlier this month when its executive vice president and chief financial officer, Mark McEachen, resigned.

Mr. McEachen's exit came after three other executive vice presidents, Byron Smith, Mark O'Leary and John O'Farrell, left the company earlier this year. In addition, Mark Stevens, an executive vice president who headed business development, left recently.

Just days before Mr. McEachen's announcement, Excite said two of its biggest cable partners, Cox Communications Inc. (COX) and Comcast Corp. (CMCSK, CMCSA), plan to stop carrying Excite's service next summer.

Excite, controlled by AT&T Corp. (T) and considered crucial to its cable unit, faces possible delisting from the Nasdaq Stock Market because its share price has fallen to less than $1 a share and it doesn't meet other standards required for listing. In afternoon trading, shares of the company were down 9.1% at 30 cents on the Nasdaq Stock Market.

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