Leapfrog Cuts Jobs as Sales Drop

Leapfrog Enterprises Inc., the maker of LeapPad electronic-learning books, said Tuesday it cut more than 180 jobs after fourth-quarter sales dropped 23%. Shares fell in after-hours trading.

The Emeryville, Calif.-based company said it had a fourth-quarter net loss of $9 million, or 15 cents a share, compared with a profit of $44.2 million, or 72 cents, a year earlier. In a preliminary earnings statement, it also said sales fell to $255.3 million from $331.4 million.

Operating expenses that increased 22% in the quarter “negatively impacted our business, which was further compounded by an industrywide lack of retailer reorders around the critical Thanksgiving period,” Chief Executive Tom Kalinske said in the statement.

Leapfrog also announced that Chief Operating Officer Fred Forsyth had resigned.

Leapfrog’s stock, which traded as high as $46.54 in October 2003, has declined 56% in the last year as U.S. retail sales of LeapPad weakened. U.S. sales fell 39% in the fourth quarter to $165.5 million.

Leapfrog shares fell $1.61 to $10.50 after the close of U.S. markets, when the news was released. The stock declined 63 cents to $12.11 in regular trading on the New York Stock Exchange.