AOL to cut one-third of workforce

As spin-off from Time Warner looms, the dial-up provider and online media company says it plans on cutting staff to save $300 million.

EMAIL  |   PRINT  |   SHARE  |   RSS
 
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
By David Goldman, CNNMoney.com staff writer

tim_armstrong__aol.03.jpg
AOL Chief Executive Tim Armstrong told staff he will not take a bonus for 2009 after the company announced it will lay off 2,300 workers.
How has the $787 billion stimulus package affected the economy?
  • It has aided a recovery
  • It has made the situation worse
  • It has had no impact
  • It's too soon to tell

NEW YORK (CNNMoney.com) -- AOL plans to cut one-third of its workforce after its spin-off from Time Warner is completed, the Internet media company announced Thursday in a government filing.

Tim Armstrong, AOL's chief executive, also told his staff Thursday that he will not take a bonus for 2009.

"As a member of our team and the person who takes accountability for the results of the company, I am making the decision to forego my 2009 bonus," Armstrong said in an e-mail to AOL employees. "That decision is a personal one and is not a sign for the future payout of the overall bonus plan for employees."

The job cuts will total about 2,300, according to the filing with the Securities and Exchange Commission. AOL said it will be seeking volunteers for layoffs from Dec. 4 through Dec. 11 before it begins cutting positions involuntarily.

"We will need to do an involuntary layoff if we do not reach the target numbers through the voluntary option," AOL spokeswoman Tricia Primrose said. "We believe the voluntary program gives people more choice and decision-making ability instead of waiting for the final cost recommendations and involuntary layoffs."

The company estimated that the restructuring will save AOL $300 million annually, but will cost the company $200 million in the first half of next year.

Time Warner (TWX, Fortune 500), which is the parent company of CNNMoney.com and Fortune, plans to spin off AOL by Dec. 9. To top of page

Features
They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
More Galleries
The 13 most WTF gadgets From the weird to the gross, these 13 gadgets will make you wonder why they even exist. More
Best-loved cars in America These cars and trucks topped J.D. Power's APEAL survey, which measures how much owners like their new vehicles. More
America's most powerful cars A new 'horsepower war' has erupted among U.S. automakers and these are the most potent weapons in their arsenals. More
Worry about the hackers you don't know 
Crime syndicates and government organizations pose a much greater cyber threat than renegade hacker groups like Anonymous. Play
GE CEO: Bringing jobs back to the U.S. 
Jeff Immelt says the U.S. is a cost competitive market for advanced manufacturing and that GE is bringing jobs back from Mexico. Play
Hamster wheel and wedgie-powered transit 
Red Bull Creation challenges hackers and engineers to invent new modes of transportation. Play

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.