AVG Technologies: Layoffs Amid Earnings Miss, CFO Change
AVG Technologies owner of the Managed Workplace platform for MSPs, is experiencing layoffs that may involve some channel positions, sources tell ChannelE2E. The targeted staff reductions come amid AVG’s weaker-than-expected Q3 2015 results and a forthcoming CFO change.
Updated Nov. 5, 7:33 a.m. ET: AVG has now confirmed layoffs and an SMB leadership reorganization.
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Multiple sources say AVG Technologies has cut some positions in the U.S. and the United Kingdom. The cuts may involve some marketing and channel support positions, the sources add. ChannelE2E has reached out to the anti-virus, cloud security and managed services software company for comment.
AVG Earnings Concerns
For its Q3 2015, AVG Technologies’ revenue grew 17 percent to $108.2 million but net income sank to $7.9 million, down from $18.2 million in Q3 last year. “We remain completely confident in our long-term growth strategy,” AVG Technologies CEO Gary Kovacs said.
Still, Wall Street isn’t quite so confident. Ahead of the earnings results today, AVG shares were up about 34 percent over the past 12 months, according to Associated Press. But as of 6:06 p.m. ET today, shares dropped nearly 13 percent because of the weaker-than-expect results and business forecast.
Also today, AVG announced that CFO John Little plans to leave the company. Little will retain his existing duties until a successor is found and in place.
AVG Managed Services Strategy
AVG has diversified beyond its security and SMB cloud heritage over the past couple of years, acquiring Level Platforms and its Managed Workplace technology for MSPs in June 2013.
Still, the deal had some challenges. Sources say Level Platforms was had to sell its business in 2013 to address near-term debt, and AVG had to work quite a bit to retain MSPs in 2014 before focusing on Managed Workplace’s growth again in 2015.
The company recruited N-able Technologies veterans like Marco LaVecchia and Renita Grewal to help build its channel and MSP presence. It’s difficult to pinpoint Managed Workplace’s current market performance, though AVG mentioned today that the overall company’s performance in the SMB market remains healthy. Clarification: I think AVG’s MSP-focused employees understand the market. I think AVG Corporate does not.
ChannelE2E is checking in with AVG, seeking a status update on the MSP-centric software business.