AOL, falling short of voluntary buyout goal, will lay off up to 1,200 workers

AOL to lay off up to 1,200 workers to reach target

SAN FRANCISCO — The struggling Internet company AOL was laying off up to 1,200 workers this week because it didn’t get enough volunteers to accept buyouts.

AOL spokeswoman Tricia Primrose said Monday that only 1,100 had volunteered to leave. That means AOL would need to shed up to 1,200 positions to reach its previously announced reduction target of up to 2,300, or about a third of its work force.

The cuts, which were on top of thousands of positions shed in recent years, came as AOL separated from Time Warner Inc. last month. AOL acquired Time Warner at the height of the dot-com boom in 2001, but the combination proved disastrous, prompting Time Warner to spin AOL off as a separate company.

In recent years, the company formerly known as America Online has been trying to reinvent itself as a content and advertising company as the legacy dial-up Internet access business that made the company famous steadily declined. But AOL has struggled in that transformation as its advertising revenue has failed to offset the drop in revenue from the dial-up business.

AOL was laying off some employees in the U.S. on Monday, though most will occur on Wednesday, Primrose said. She also said the company started laying off employees in Europe on Monday and planned to close offices in Spain and Sweden, though it will continue to have employees working in Sweden at its ad-serving company, Adtech AG. No further details were immediately available on where the U.S. reductions were occurring.

“We made difficult decisions about products and our profitability profile in different markets and made the decisions we believe will best position AOL to be a long-term, successful company going forward,” Primrose said.

The cuts will leave AOL at less than a quarter the size it was at its peak in 2004, when it had more than 20,000 employees. Before the latest layoffs and buyouts, AOL had about 6,900 employees.

AOL said in November it would take $200 million in charges for severance and restructuring-related costs.

AOL shares rose 29 cents, or 1.1 percent, to close at $25.97 Monday.