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Print Edition StoriesThursday, November 20, 2008
Akamai axing 110 jobs
By Mass High Tech Staff
How is the economic crisis affecting tech companies?
Despite a recently reported strong third quarter, Internet content delivery network firn Akamai Technologies Inc. said that it will be laying off 110 employees.
Akamai said it is cutting the positions, which account for about 7 percent of the Cambridge-based company’s global work force, to reduce operating costs. Officials said the company plans to use the savings from the layoffs, along with cash from operations, to investment in growing its content delivery, application acceleration and advertising industry solutions, as well as for more expansion overseas.
Late last month, Akamai (Nasdaq: AKAM) reported it posted a 22 percent year-over-year increase in revenue for the third quarter. At the time, Akamai CEO Paul Sagan cited “strong growth” in new products, such as application performance services and dynamic site accelerations, and he also pointed to the company’s $251 million cash flow so far this year.
Akamai reported net income of $33.4 million on revenue of $197.3 million in the September quarter. That profit was up 37 percent over the same quarter last year. Akamai’s list of customers under long-term service contracts grew by 83, to a record 2,808, the company said.
Also in October, Akamai announced plans to use $95 million of that cash to purchase New York-based acerno Inc., an online co-operative of shopping and purchase data for online advertising. The deal awaits approval by acerno’s shareholders.
The company employs about 1,300 workers. For 2007, Akamai reported a profit of $101 million on revenue of $636.4 million.
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