Company News: EarthLink gets boost on jobs news

Shares of EarthLink Inc. climbed more than 6 percent Tuesday after the Internet service provider said it would cut 900 jobs – or about half its work force – and close four offices in an effort to reduce operating costs.

The company also said it will repurchase $200 million of its stock as part of the plan, said Rolla Huff, the Atlanta-based company’s president and chief executive. More cuts could be announced before the year’s end, he said.

The company will close offices in Orlando, Fla., Knoxville, Tenn., Harrisburg, Penn. and San Francisco. EarthLink also said it will “substantially reduce its presence” in Atlanta and Pasadena, Calif.

EarthLink said it expects to save from $25 million to $35 million through the rest of the year because of the restructuring. The company currently employs about 1,900 people.

Shares rose 44 cents, or 6.4 percent, to $7.30 in afternoon trading. EarthLink also offered a warning for 2008, saying it expects subscriber additions to slow.

“Not even Harry Potter could conjure up enough business to help Borders Group Inc. avoid more losses in the second quarter.

The nation’s second-largest bookseller said Tuesday that heavy charges outweighed a boost in sales driven by “Harry Potter and the Deathly Hallows,” the seventh and final book in the phenomenally popular series.

For the quarter ended Aug. 4, the company reported a loss of $25.1 million, or 43 cents per share, versus a loss of $18.4 million, or 29 cents per share, in the prior-year quarter.

Excluding charges for a tentative agreement to settle litigation in California, store closure and relocation costs, executive severance costs, and professional fees, the company said it had a loss of 26 cents per share for the quarter.

Analysts polled by Thomson Financial expected a loss of 34 cents per share.

“The Albuquerque Tribune, the city’s afternoon paper, has been put up for sale, and its owner, the E.W. Scripps Co., said it intends to close the afternoon paper if a buyer is not found.

Scripps notified the Tribune’s 45 editorial employees of its decision Tuesday and told them Scripps will discontinue publication if a qualified buyer is not found within a reasonable, but unspecified, period of time.

Rich Boehne, executive vice president and chief operating officer for Scripps, who met with Tribune staff members, said the Tribune had an outstanding reputation for journalistic excellence. “Unfortunately, readers in Albuquerque, as in nearly all cities across America, are choosing other media alternatives to afternoon newspapers,” he said.