Altavista, the US-based internet portal and search engine, has said it is laying off 200 employees, amounting to about 25% of its staff, because of weak advertising sales.

"Altavista has not been immune to the softness in advertising," Altavista executive adviser Peter Mills said in a statement.

It is the second large scale jobs cull the firm has implemented in recent months.

Last September, Altavista cut what was then a quarter of its staff, in an attempt to speed progress to profitability.

Share sale cancelled

Since then, the company has struggled under the general gloom pervading the internet sector. It has also lost key managerial personnel, including its chief executive Rod Schrock who resigned in October.

More recently, Altavista abandoned plans for an initial public offering that had been hoped to raise up to $300m.

The sale of shares in the company had already been delayed twice before - once last year when the market value of internet companies collapsed and once in 1996, also because of depressed market conditions.

The company is now 80% owned by internet investment firm CMGI, with the remaining 20% held by Compaq Computer.

'Incredibly poor timing'

On his departure from Altavista, Mr Schrock had said the company had done well but been "blessed with a sense of incredibly poor timing".

When it laid off 225 employees last September, CMGI said Altavista's North American operations were expected to become profitable by the end of January 2001.

Thursday's job losses appeared to spell defeat for those hopes but Altavista declined to comment on when it would reach profitability.

Altavista claims to have more than 65 million users a month, more than half of whom are outside North America.

The Palo Alto, California-based company now has about 600 staff worldwide.