Embattled Homestore Inc. will cut 300 jobs in the first quarter of this year, the company said yesterday.
The news is the latest in a string of developments following Homestore's announcement earlier this year that it overstated advertising revenue from January to September 2001 by $54 million to $95 million, according to preliminary results of an internal accounting audit.
Homestore, a residential real estate portal, also announced yesterday it sold its eNeighborhoods business unit. The buyer was not identified.
“By disposing of non-strategic businesses, and eliminating unnecessary investments and corporate services, the new Homestore is now centered primarily on improving the usefulness and quality of our real estate products and services,” CEO Michael Long said in a statement.
Three weeks ago, Homestore said it had fired or accepted resignations from seven employees, including three who had been placed on administrative leave, as the result of the accounting inquiry, which began in December.
Homestore, Westlake Village, CA, has said that it will restate its earnings for the first nine months of the year. The company also has said that the transactions under review occurred in 2001 and 2000 and that it may have to restate its earnings for 2000 as well.
Long was named CEO Jan. 7 to replace co-founder, chairman and CEO Stuart Wolff, who resigned to “pursue a new technology venture,” the company said. Long previously was CEO of Healtheon Corp. and served as chairman of WebMD Inc. after the two companies merged.
