The World: New York - AOL to lose 2,500 staff from its US operations

AOL is to cut around 2,500 employees from its US operations. The reductions will initially come from volunteer buyouts across the company.

However, if the 2,500 target is not met on that basis, then more targeted layoffs will be made in the first quarter of next year.

The cuts are expected to save AOL around $300 million in annual operating costs. As part of the reductions, Tim Armstrong, the chief executive of AOL, has announced that he is to forego his 2009 bonus, which is believed to be between $1 million and $4 million.