Merrill Lynch posts big loss, to cut 2,900 jobs

By Dan Wilchins

NEW YORK (Reuters) - Merrill Lynch & Co on Thursday posted a quarterly loss of $2 billion and said it planned to cut 2,900 more jobs after recording more than $6.5 billion in write-downs on subprime mortgages and other risky assets.

The results were worse than Wall Street analysts' gloomy expectations, but Merrill Lynch's shares rose amid hopes that the company was working through its problems and closer to seeing improvement.

"My sense is, they tried to clean the bad stuff off the shelves, and they hope it's mostly in the trash," said Michael Holland, founder of Holland & Co, which oversees more than $4 billion of assets.

Merrill Lynch's first-quarter net loss to common shareholders was $2.14 billion, or $2.19 per share, compared with a profit of $2.11 billion, or $2.26 a share, in the same quarter last year.

The loss from continuing operations was $2.20 per share, wider than the analysts' average forecast of $1.96, according to Reuters Estimates.

Net revenue declined 69 percent to $2.93 billion. Analysts had expected $3.35 billion.

Chief Executive John Thain said on a conference call with investors that the three months ended March 31 were "as difficult a quarter as I've seen in my 30 years on Wall Street."

But Thain also implied that Merrill Lynch may post profits in coming quarters, and told a group of reporters that the month of April was generally better than March.