ALAMEDA, Calif.—Wireless data infrastructure provider Geoworks Corp. announced a series of drastic moves and a depressing third quarter report, news that sent the company’s stock rocketing down almost 40 percent in trading today to just under 50 cents per share.
The company said it will cut 45 percent of its work force, or 40 people, will relocate to a smaller, less expensive office, and will sell its flagship wireless data infrastructure product, the AirBoss Application Platform.
“While we successfully executed the cost-reduction plan announced in October, bringing operating expenses down by $2.3 million in the quarter, the market for wireless data infrastructure software continues to be very weak,” said Dave Grannan, the company’s president and chief executive officer. “However, Geoworks simply does not have the financial resources to support ongoing development of the AirBoss Application Platform and wait for this market to emerge.”
Grannan said the company is hoping to sell the technology team and the platform, which allows customers to develop, deploy and manage enterprise applications on mobile devices, but said Geoworks cannot guarantee it will find a buyer.
Grannan said the AirBoss platform has been the focus of the company’s strategy since Geoworks acquired the technology in 2000. He said the company will now refocus its efforts on its Professional Services division, which now has two customers, in hopes of growing the business.
Geoworks recorded revenue for the quarter of $4 million, up from the $2 million the company scored in the previous quarter but down from the $4.3 million in the same quarter a year ago. The company’s net loss for the quarter was $14 million, down from a net loss of $17 million in the previous quarter. The company had cash and cash equivalents of about $4 million at the end of the quarter.
Geoworks’ troubles are not surprising. Other companies selling wireless access products and services to businesses have suffered similar problems. 2Roam shut down, while a variety of others have been acquired.
