Cost-Cutting Continues at TouchStone

TouchStone Software Corp. in Huntington Beach has laid off a third of its staff since hiring a new president last month as the struggling company continues its cost-cutting efforts.

The company, which makes computer diagnostic software, has been battling slumping sales, particularly with its antivirus products. Seeking to find new ways to shore up its bottom line and stabilize its executive suite, TouchStone hired software veteran Kenneth S. Forbes III as president and chief executive in August.

Since Forbes’ arrival, TouchStone has cut 11 people from its staff, reducing total employment to 21. The layoffs have been part of a continual downsizing for the company, which had 58 employees last September and 32 when Forbes came on board.

TouchStone expects to further reduce its administrative overhead and boost its internal efficiencies, said spokeswoman Pamela Swartwood. As part of this effort, the company has stopped working on its line of antivirus software, ending its development venture with Trend Micro Inc. in Cupertino, officials said.

TouchStone posted a net loss of $1.96 million, or 25 cents a share, on sales of $650,000 for the second quarter. For the same period a year earlier, the company posted a loss of $1.2 million, or 15 cents a share, on sales of $1.9 million.

TouchStone’s stock price fell 6 cents a share to close at $1.13 in the Nasdaq market Wednesday.