CommTouch Software (Nasdaq:CTCH) (CTCH) has only 15 employees left at its Israeli R&D center after dismissing another 40 today, has learned. No comment could be obtained from the company, however.

Netanya-based Commtouch, which provides hosted messaging and collaboration solutions to service providers, employs about 50 more people outside Israel.

A report on Israel radio claims that Commtouch also dismissed some of its staff abroad, terminating about 70 jobs all told. If accurate, that would leave it a worldwide staff of about 25 to 30 people.

Sources near the company say it intends to shut down its R&D operations altogether, which insofar as is known are conducted solely in Israel. Meanwhile the company will focus on marketing and sales in the United States.

At its peak Commtouch had 500 employees. This year it has terminated 400 jobs in three waves, the last in August.

Its second-quarter results, published in August, show that it had about $9.7 million cash left at the end of the quarter.

Its second-quarter revenues slid 14% from the corresponding three months of 2000 to $4.4 million, still almost 9% more than achieved in the previous quarter. It lost a net $8.5 million in the second quarter, 21% more than in the corresponding quarter and 10% more than in the first quarter of 2001.

Commtouch stock, traded on Wall Street, has eroded to 42 cents, from its all-time record of $60.