The mayhem in the media industry continues. The Wall Street Journal, a News Corp (NASDAQ: NWS) property, is closing its Boston bureau and sending nine employees into the wind. The newswire and MarketWatch operations are going to stay open in Boston, however, with no headcount impact.

The Journal doesn't have any plans to close other offices, according to a memo by managing editor Robert Thomson: "there are no plans, nascent or otherwise, to close any other U.S. or international bureau." The WSJ will still support an "investigative function" in Boston, but the New York-based Money and Investing team will cover Boston's mutual fund industry, which boasts such heavy hitters as Fidelity.

At the same time, magazine company Time Inc., owned by Time Warner (NYSE: TWX) is looking to cut $100 million in expenses, and layoffs will undoubtedly figure into the equation. The company that owns Time, Fortune, People and Sports Illustrated - and falls under the same umbrella as AOL, which owns BloggingStocks - is feeling the squeeze of a media recession that's even worse than the regular recession we've all been battling for what feels like decades.

Continue reading Time and WSJ to lay off more

Time and WSJ to lay off more originally appeared on BloggingStocks on Fri, 30 Oct 2009 14:20:00 EST. Please see our terms for use of feeds.

Computer-networking icon Cisco Systems (NASDAQ: CSCO) is trying to cut costs wherever it can. In a sign of the times, Cisco will shut offices for four days during the Christmas/New-Year period in an effort to defend its profit margins (critical operations will remain open). Other tech companies that are trying to utilize time off for employees as a way of saving money include Apple (NASDAQ: AAPL), Hewlett-Packard (NYSE: HPQ) and Adobe (NASDAQ: ADBE).

When I read headlines like this, it makes me doubt the current rally we've seen in the markets. Indeed, bear-market rallies are common when things get way oversold. Then the euphoria gets put in perspective when we realize that it's going to be a long time until the economy truly finds its way back into a cycle of growth.

Businesses like Cisco will suffer from declining top-line sales as its customers become increasingly conservative with their investment capital. At that point, the only defensive move is to cut costs. And that's not a great position to be in. It limits management's ability to run operations, and it sends a bad message to Wall Street. Like some people have been saying, tools such as cost-cutting and layoffs aren't necessarily being perceived as positive elements in this cycle; they only serve to accentuate the dread of the slowing global economy.

Continue reading Cisco Systems in need of cost containment

Cisco Systems in need of cost containment originally appeared on BloggingStocks on Fri, 28 Nov 2008 10:10:00 EST. Please see our terms for use of feeds.

Michael Dell needs to get his story straight. He recently said that Dell's (NASDAQ: DELL) sales were doing well in China and the Middle East. Investors should look at that as a good sign.

Now, the CEO of the No.2 PC company says his firm needs to make really big cuts. According to The Wall Street Journal, "The company is imposing a hiring freeze, offering employees voluntary buyouts and asking workers to take one to five days off without pay." The "without pay" thing seems a bit bizarre for a company that is still profitable.

Based on information from last quarter, Dell had $8 billion in cash and made $784 million in net income.

Dell is asking a lot of the people who are still with the company after several rounds of restructuring. The company's founder and CEO is not doing anything to pitch in. Not only is he a billionaire, but according to the firm's last proxy, he made $2.3 billion.

Dell got his company into trouble by overbuilding manufacturing operations. He can afford to take $1 a year so that the people he is asking to do more feel that he is in the trouble with him.

But he did not cut his salary one penny.

Douglas A. McIntyre is an editor at 247wallst.com.

Dell looks for huge cuts, Michael Dell keeps his salary originally appeared on BloggingStocks on Wed, 05 Nov 2008 08:31:00 EST. Please see our terms for use of feeds.

News that FedEx (NYSE: FDX) is taking a huge charge of $891 million to drop the name Kinko's marks both the end of an era, as well as a huge waste of money that will impact shareholders.

According to the story in MarketWatch: "The company called it a "strategic decision" to strike Kinko's from the retail chain's name, and the charge is broken down into a $515 million charge for the use of the trade name, $367 million in goodwill and $9 million in other expenses."

A $515 million charge for use of the trade name? You've got to be kidding. The new name is going to be FedEx Office. That's pretty catchy, huh? I am going to run over there right now to make a photocopy, because it is such great branding. Not.

The company says that Kinko's was primarily a photocopying and faxing service while FedEx office is an entire back-office for small and mid-sized businesses. Unfortunately, with the halting of new store openings and layoffs, it appears that small and mid-sized businesses don't need to outsource their whole back-office to FedEx.

Bye bye Kinko's, it was fun while it lasted.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. DISCLOSURE: Writer's fund has has no position in any stock mentioned, as of 6/3/08

Kinko's: It was nice knowing you originally appeared on BloggingStocks on Tue, 03 Jun 2008 08:40:00 EST. Please see our terms for use of feeds.

Toyota expects to save $2.7 billion through compatibility originally appeared on BloggingStocks on Tue, 11 Dec 2007 13:37:00 EST. Please see our terms for use of feeds.

For now, Trump won't sell originally appeared on BloggingStocks on Mon, 02 Jul 2007 16:10:00 EST. Please see our terms for use of feeds.

It is an odd company that says its turnaround is "on track" when market share in its home company and largest market is falling like a rock. But, so say Ford Motor Co. (NYSE: F) management.

"The closures and the employment reductions to size the capacity to the real demand -- we're a little bit ahead," Ford's CEO told reporters. "But generally (we're) on plan."

Ford has a couple of other cards in the hole. It will probably improve its balance sheet by several billion if it can sell its Jaguar and Land Rover units. And, upcoming UAW contract negotiations may give Ford the chance to beg off pension and benefits cost cuts. But, the point will come when Ford's recovery is measured by a need to spend more money to help improve production for rising sales.

But, a turnaround is not a turnaround without some stability in revenue, and Ford has been unable to show that. Its most profitable vehicles are its SUVs and pick-ups, and the sales of those are running down by double digits most months.

Measuring progress by cost cutting is generally a Faustian bargain. The Devil eventually comes for the whole company.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Ford's view of "on target" originally appeared on BloggingStocks on Sun, 24 Jun 2007 10:10:00 EST. Please see our terms for use of feeds.