eToys

(ETYS)

was down 51.5% in preopen

Island

trading.

Late Friday, the online toyseller said its third-quarter sales would fall short of expectations due to slow holiday sales. The company expects to announce layoffs in January and said it has hired

Goldman Sachs

to help it find a way to remain open.

eToys also said its operating loss for the quarter would be 55%-65% of revenue instead of the previously projected 22%-28%.