CAMBRIDGE (Bloomberg) — Sapient Corp., which helps businesses build software and Internet systems, said it’s firing 720 people, or about 20 percent of its workforce, as it faces a sales slowdown that will cause a first-quarter loss. Sapient is cutting costs to deal with declining corporate spending on computer and Internet-related products and services. Revenue from dot-com clients is dwindling as many go out of business or run out of cash. At the same time, large corporate customers are curbing spending on Web projects as the threat from dot-com rivals subsides.
The company said it will have a first-quarter loss of 3 cents to 5 cents a share, excluding costs for restructuring, stock-based compensation, acquisitions and amortization of intangibles. Analysts expected profit of 9 cents, the average estimate in a poll by First Call/Thomson Financial. Sales will be about $108.8 million, or 20 percent less than analysts’ average estimate of $136 million, the company said. The company will take a charge of $35 million to $40 million in the first quarter for expenses related to the job cuts and other restructuring moves. The company said the moves will save it about $5 million in the first quarter and about $60 million to $65 million a year after that.
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