AppliedTheory , the Internet knowledge, development and managed hosting partner for hundreds of large corporations and government agencies, today announced it has cut its national workforce by approximately 25 percent as part of a restructuring initiative to position the Internet industry pioneer for profitability and long-term sustainability amid continued negative market conditions.

The company reduced its national employee base by 114 and closed several regional offices related to operating units that were under-performing financially or not relevant to AppliedTheory's managed hosting services and applications development customers. AppliedTheory currently employs about 300 associates nationally.

Company officials said that negative market conditions make it imperative for AppliedTheory to place increased emphasis on protecting its current customer base and optimizing earnings from its core managed hosting services and related applications development business. They added that the restructuring initiative represents a pragmatic, decisive strategy to successfully carry out AppliedTheory's business plan to achieve profitability.

AppliedTheory will provide additional information and comment during its scheduled conference call at 5 p.m. (EST) Thursday, March 28, 2002, to discuss fourth quarter 2001 results. For details regarding the conference call, please refer to the announcement found at http://www.appliedtheory.com/