Akamai Cuts 7% Of Workforce, 110 Layoffs Across All Divisions Of The Company

Akamai said late today that it would cut 7% of their workforce, or about 110 employees, and will take a $4 million quarterly charge as a result. (8-K) Not good news for the CDN industry and this could be the first sign that the CDN market could see some effects from the poor economy, even with all the money that the content delivery networks have raised.

Will provide more details if I get them.  While Akamai is not saying how many layoffs happend in each group, they did confirm that the cuts are across all divisions of the company and that all 110 layoffs took place today. With 58 current job openings listed on their website, I would expect that will change over the next few days as well.

Updated: In regards to all of the open job postings on the Akamai website, Akamai says that they are still hiring for some specific roles, for instance within their Advertising Decision Solutions line. Exactly how many open jobs they still have is not known at this time.

  • http://www.video-commerce.org Justin Foster

    Bummer. Time to invest in product and cut back on sales & marketing.

  • Jonathan

    Guess this changes your tune as to the CDN business being immune from the current economic climate. Your post of all those job openings a few weeks ago was timely. There is a shift going on that goes across industries, cash is king, positive cashflow. IMHO all this reduction and adjusting is just beginning, lots of providers running on VC.

  • http://www.BusinessOfVideo.com Dan Rayburn

    Most of the CDNs are running on VC money, but Akamai isn’t and is one that is making money and has lots of cash in the bank. Seems like an odd time for Akamai to make the change unless they are simply trying to cut costs like everyone else. They still make money and have a ton of cash. They are not a startup and they are still the number one player in the CDN market by hundreds of millions of dollars over the others. Clearly they are not seeing as high a level of growth as before, but I also don’t think it is as bad, for Akamai in particular, as some are making it out to be.
    But with their stock closing at under $10 today, anyone who owns shares (I don’t) is clearly feeling the pain. Wall Street is clearly unhappy with them and many wished that Akamai would have provided some guidance for 2009 at the Akamai analyst day today.

  • shaun noll

    any details or thoughts on the verizon “CDN” offering? i would imagine its a pretty crude product
    your thoughts are always appreciated!

  • Dow 6400

    Companys in virtually every industry are making preemptive job cuts. That was the gist of Akamai’s announcement.
    When times are tough companys do more with less. It doesn’t mean their demand has slacked or that their margins are compressed, it simply means that they don’t want to wait until that occurs if and when it ever does.

  • http://twitter.com/vincechew Vince Chew

    Verizon has been too agressive in grabbing new business but slow in building up its support organization (that includes Customer Service/Relationship). I have personally encounter their badly managed service desk and incident management platform.

  • http://www.layoffgossip.com/ Layoffs

    People always hate to talk about when they are laid off. But as it has become every day’s news headline since Yahoo started it with cutting 1500 of its task force last year.