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CA reports lower 4Q sales, staff shake-up

After a two-year absence, CA Technologies is back

After a two-year absence, CA Technologies is back on the Fortune magazine list of the nation's 500 largest public companies based on 2012 revenue. The list was released Monday, May 6, 2013. Credit: Kevin P. Coughlin, 2012

Software maker CA Technologies reported lower fourth-quarter sales Tuesday and announced it would replace 1,200 employees worldwide as part of a shake-up to recalibrate the company's focus under its new chief executive.

Islandia-based CA, Long Island's largest company by stock market value, said revenue fell to $1.15 billion during the three months through March, down 3 percent from the same period last year.

Chief executive Mike Gregoire, who took the helm in January, said CA needed to be faster, more innovative and better at attracting customers beyond those who buy its legacy mainframe software programs.

"The traditional ways we've looked at systems, data, applications and security are being challenged by disruptive technologies like mobility, cloud . . . and big data," Gregoire said. "Businesses have higher expectations from IT, demanding far greater speed and agility and anytime, anywhere secure connectivity."

Despite the drop in sales, CA's profit climbed 15 percent, to $242 million, as the company trimmed the amount it spent on income tax, marketing, administration and other expenses.

Gregoire, who joined CA from Dublin, Calif.-based Taleo Corp. to replace retiring chief executive Bill McCracken, has said the company needs to become more nimble as it expands beyond mainframe software to embrace newer technology.

During a presentation Tuesday to investors and analysts in Manhattan, Gregoire laid out his strategy to reconfigure the company's workforce and sales strategy to focus on areas where he sees the strongest potential for growth.

The plan calls for replacing about 9 percent of the company's 14,000 workers and consolidating its development locations to 40 sites, down from 81. The company will take a $150 million charge.

CA declined to say how many of its 1,525 Long Island employees would be terminated. Roughly 60 percent of the affected employees are expected to be in North and South America. The cuts are scheduled to be complete by July, and CA plans to fill most of the positions over the next year.

CA's shares fell $1.37 in after-hours trading following the announcement, to $26.40. The company's stock market value is more than $12 billion.

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