Updated from 9:48 a.m. EST
Struggling online software store
said Wednesday that its president and chief executive had stepped down as part of a major restructuring designed to strengthen the company's focus on the business-to-business market.
The restructuring includes the elimination of 75 jobs, or 20% of Beyond.com's workforce. In the first quarter, Beyond.com expects to take a one-time restructuring charge of between $2 million and $3 million.
"Our management team has worked hard to re-deploy a majority of our employees toward our new B2B efforts," said Rick Neely, senior vice president of finance and administration and CFO, and now interim CEO, said in a statement.
The company is simultaneously reducing its consumer focus, which led to the departure of Mark Breier, the company's chief executive since March 1998. "Beyond.com's transition to a B2B company is the right direction for the company," Breier said in the statement. "While I've enjoyed the challenges of running a top Internet shopping site, Beyond.com now needs a CEO with B2B expertise and the vision to lead the company."
Breier said in the statement that he would become an adviser to Internet start-up companies but was not more specific.
Beyond.com said it has retained an executive recruiter to search for a new CEO.
The e-commerce company has been buffeted by management upheaval over the last several months, and has seen its stock price languish since the company went public in 1998. Beyond.com's stock, priced at $9 a share during its IPO, was up 5/16, or 4%, to 8 1/4 after Wednesday's announcement. The company signaled its intent to focus on B2B earlier this month. (Beyond.com closed up 1/2, or 6.35%, at 8 1/2.)
Beyond.com also said at the beginning of January that it expected fourth-quarter earnings to come in below Wall Street's expectations because of sluggish sales to consumers. Analysts surveyed by
First Call/Thomson Financial
expect losses of 67 cents per share for the quarter.
"Finally, they've thrown in the towel and taken some medicine," said Daniel Ries, analyst with
C.E. Unterberg, Towbin
, which led the company's IPO and assisted on a Beyond.com secondary offering. "They've done what the market has been telling them for months, that the return potential of the consumer software market just isn't there."
Ries noted that the next CEO "will preferably be someone who has sold software ... to corporations." Breier's background is in consumer marketing, and his resume includes stints in brand marketing at
Dreyer's Grand Ice Cream