Zillow CEO Rich Barton today announced the real estate site was laying off one quarter of its workforce even though it has “sizable cash reserves” because it’s not profitable yet and foresees “a prolonged recession.”

            An estimated 40 employees will be laid off, most in technology and marketing at the company’s headquarters in Seattle.

            In a candid blog post, Barton said “the business continues to grow” with September traffic up revenue 42 percent year-over-year, but added, “We are a young company that is not yet making a profit. … We deemed the responsible course was to meaningfully reduce expenses, so that Zillow emerges from the other side of the recession in a very strong position, even if the recession lasts many years.”

            Most CEOs don’t sound as sincere, either, in their comments about the people they’re laying off. “I want to thank these folks for their service and offer my apology for having to make this decision,” he wrote.

            “We firmly believe that we are doing what is painful but necessary to ensure a bright long-term future for a company that, in a very short period of time, has become an important resource and a household name for all those interested in homes,” he wrote.

             Zillow has raised $87 million in venture capital funding. It was launched in February 2006 by Barton, who also founded the travel site Expedia.com. Its defining feature — a hot craze during the real estate boom — is its “Zestimate” home price valuation estimation tool.