America Online has laid off 420 customer service call centre employees in an effort to reduce costs further.
The job cuts affected employees at company call centres around the US, according to AOL spokesman Jim Whitney.
The company said it is reorganising its call centres to handle customer calls more efficiently by focusing on specific inquiries, as well as by expanding its online support, and does not expect the cuts to affect customer service.
The layoffs come as part of a plan announced late last year to reduce expenses at the ISP by $100m (£64m).
Faced with dwindling ad revenue and the threat of losing subscribers to growing broadband rivals, AOL has launched a widespread cost-cutting and restructuring campaign, which focuses on premium services and increasing its high-speed access subscribers.
The company has also introduced an enhanced AOL for broadband product with content and service offerings. Additionally, the ISP rolled out a voicemail service last week in an effort to expand its premium services.
But while the ISP works to drum up revenue, it still faces serious financial challenges which have only been heightened by government probes into its accounting practices.
Both the US Securities and Exchange Commission and the US Department of Justice are investigating whether AOL double-booked ad revenue in an effort to prop up financial results.