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Iomega to Cut Jobs, Warns of Quarterly Loss

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June 19, 1999|Times Wire Services

Iomega Corp. warned of a second-quarter loss due to continued weak sales of its Zip and Jaz disks and drives, and said it will cut 450 jobs, or nearly 10% of its work force, as part of a cost-cutting move. The Roy, Utah-based company expects to take a $45-million charge in the quarter as it fires temporary and regular workers, closes plants in San Jose and San Diego, writes off assets and consolidates some operations outside the United States. Iomega said it expects a loss in the range of 5 cents to 10 cents a share even without the charge. Analysts had been expecting the company to break even with the 13-cent profit it earned in the year-ago second quarter, according to First Call Corp. Iomega said a delay in shipping its Clik PC Card drive, which can be used to record photographs taken on digital cameras, also contributed to the loss. Iomega shares fell 56 cents to close at $3.81 on the New York Stock Exchange. The bulk of the firings are expected to come in July, Iomega said.

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