IT management software firm CA is to axe 1,700 jobs – more than 10% of its total workforce, after a sharp fall in first quarter profits.
Rumours earlier this month suggested the troubled firm would cut 1,000 jobs, following 800 redundancies announced last year in a bid to cut operating costs.
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CA has now posted first quarter results showing a 64% fall in profits to $35m (£18m), down from $97m in the same quarter last year.
Chief executive John Swainson said, “We are not satisfied with our cost structure and we are implementing an expense reduction plan to improve the company’s efficiency and competitive position. These are the first steps in a long-term program to achieve a best-of-breed cost structure.”
The job cuts are set to incur about $200m in charges, mainly over the next two financial quarters.
CA has yet to recover from the $2.2bn (£1.2bn) accounting fraud in 2004 that saw former chief executive Sanjay Kumar and former head of sales Stephen Richards plead guilty to fraud, perjury and obstruction of justice charges.
Earlier this month, CA filed its delayed 2006 financial report with the US Securities and Exchange Commission. The results had been expected in May, but were held up after the company uncovered accounting errors. The filing also saw CA restate its results for previous years.
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