SonicWall Restructures, Cuts Staff


SonicWall Tuesday said it is undertaking a series of cost-cutting measures, including a workforce reduction.

The company, a provider of Internet security appliances, said it will cut its workforce by 15 percent to 20 percent, consolidate office facilities, and eliminate duplicate resources resulting from its recent acquisitions. A company spokesman indicated that the layoffs will not affect its channel support.

Due to the restructuring, SonicWall expects charges of about $2 million to $4 million.

"We are moving quickly to improve the productivity of our organization," Cosmo Santullo, SonicWall president and CEO, said in a prepared statement.

"While these measures are difficult, we believe that by focusing our resources and leveraging the strengths of this company, we can more profitably grow our business and continue to extend our market leadership," he said.

Last month, the company warned that first-quarter earnings would fall short of expectations due to a sluggish economy. SonicWall posted first-quarter pro forma net income of $1.7 million on revenue of $28.1 million, compared with net income of $5.2 million on revenue of $24.6 million for the same quarter a year ago.

SonicWall's reorganization follows on the heels of last week's news from RSA Security that it is restructuring the company around three new product divisions and cutting 17 percent of its work force.