Vignette Releases Q4 Numbers, Plans To Reduce Workforce

Vignette, which released financials for the fourth quarter of 2000 Thursday, said it will embark on cost-cutting measures in 2001 that will include workforce reductions and consolidation of facilities. The company also reduced earnings estimates for 2001.

The company said it brought in $123.9 million in revenue for the quarter--up 203 percent from the fourth quarter of 1999 and 12 percent more than the previous quarter. Despite the revenue increase, the company reported an operating loss of $6.3 million for the quarter.

There were 97 new customers added during the quarter, bringing the total base to 1,248 end-user clients.

"In the fourth quarter, we saw a significant number of Global 1000 companies choose Vignette technology to drive their online initiatives," said Greg Peters, chairman, president and CEO of Vignette in a statement. "The financial commitments made by those customers to Vignette continue to increase, and we built and expanded partnerships with many of technology companies."

As far as partners, Vignette said it increased the number of third-party professionals to nearly 2,000 during the quarter and expanded relationships with companies like Accenture, IBM Global Services, Sapient and Sun Microsystems. New alliances were also formed with PricewaterhouseCoopers and Computer Sciences.

The company said that while its long-term outlook is strong, the uneasy market conditions have made it reduce its financial guidance for fiscal year 2001. As a result, Vignette expects revenue of $100 million and core earnings of 1 cent per share for the first quarter of 2001. It expects revenue of $500 million and core EPS of nine cents per share for the full year 2001.

Vignette is planning to reduce its overall cost of operations via workforce reductions and consolidation of certain facilities. While the company expects to incur a charge of roughly $45 to $55 million in the first quarter, it hopes to will save approximately $100 million during the next four quarters as a result of the cost-cutting actions.

"Our priorities are simple," Peters said. "First, to continue to ensure that we have the most value-added solutions available in the market so we can continue to grow our business and market share; and, second, to do so profitably."

The company will reportedly lay off 345 employees, or approximately 15 percent of its 2,300 person-strong workforce.