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4G/3G/WiFi

Sprint to Cut 2,000 More Jobs

Sprint's new CEO said the company will cut about 2,000 more jobs from its workforce, and there will be more changes in management too.

Sprint Corp. (NYSE: S) CEO Marcelo Claure said on the operator's fiscal second quarter call Monday that the new cuts are "regrettable" but necessary for Sprint to compete in the marketplace. These cuts are in addition to the layoffs that Sprint is already undertaking. The operator has cut more than 900 positions so far this year. (See Sprint Starts Layoffs, Will Take $160M Charge and Sprint Cuts 452 Jobs at Kansas HQ.)

Claure added that the operator has been undertaking a management review and could change more of its top team as well. "More changes are coming," the CEO promised.

Claure said he anticipates that the cuts will help Sprint whittle out $400 million in employment costs in 2015. It is planning to cut its total annual costs by $1.5 billion.

The company is continuing to spend, however, on its LTE updates. It is anticipating spending just under $6 billion on capital expenditures this year. Sprint CFO Joe Euteneuer said Sprint spent $1.5 billion on capex in the fiscal second quarter, largely driven by the Spark updates. This is down $300 million year-on-year, but the CEO and CFO both stressed that the operator is on track with or beating its LTE deployment targets. (See Sprint Promises 180Mbit/s 'Peaks' in 2015.)

"Our LTE is now available to over 250 million of the American population in over 500 cities," Claure said.

The operator expects to complete its 4G LTE buildout on the lower band 800MHz frequency this year, where it has the spectrum available. Its faster 2.5GHz Spark update now covers 92 million and is expected to hit 100 million by year's end. (See Sprint Goes Live With 8T8R in Chicago and Fanning Sprint's Spark in NYC.)


For more on carriers' 4G strategies, check out our dedicated LTE channel here on Light Reading.


Despite the CEO's talk on the call of September and October being "record months," Sprint is still losing customers that sign up for a two-year monthly contract. The operator lost 272,000 postpaid subscribers in the quarter.

It did have 35,000 prepaid, or pay-as-you-go, subscribers sign on in the quarter. Wholesale additions of 827,000 subscribers came through Sprint brands such as Boost Mobile and MVNOs such as FreedomPop .

For the quarter, Sprint reported a operating loss of $192 million on revenue of $8.5 billion. Net loss per share came in at 19 cents. Wall Street analysts had been expecting a loss of six cents.

— Dan Jones, Mobile Editor, Light Reading

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DHagar 11/4/2014 | 2:13:30 PM
Re: Job Cuts Phil_Britt, good points.  We are truly losing valuable human capital.  If we are going to build a strong sustainable economy, we have to find a way to rebuild that knowledge.
Phil_Britt 11/4/2014 | 2:03:27 PM
Re: Jobs Cuts DHager,

 

You are correct about people not being rehired at their previous level. While some can make more as consultants/contractors, most are taking work far below previous levels in terms of pay and benefits.

The other issue is that often the people pushed out early are higher-paid employees/managers who have inherent knowledge of how things do and don't work and are more than just robots who look at a troubleshooting list to fix problems.
DHagar 11/4/2014 | 1:54:32 PM
Re: Jobs Cuts Ariella,

But even people who have lost jobs and then found jobs again are not necessarily fully recovered. Some are earning less than they were 6 years ago, and inflation (low, though, it may be) has been cutting their real income even more. 

Agreed, the economy is not sustaining the previous level of earnings in those jobs and the job market is also shifting - the value of jobs is changing.
DHagar 11/4/2014 | 1:48:31 PM
Re: Job Cut MikeP688, I am routing for them as well.  And I agree with Joe that  I see Sprint as moving forward and being innovative in developing new models.

I think the economy is growing, but is not strong enough yet to broadly sustain the consumer spending that will feed the growth telecoms are waiting for.
Ariella 11/4/2014 | 9:43:13 AM
Re: job cut @KBode Hard to get ahead with a "loser mentality" (It makes me think of the tracked students who recognize they're in the "dummy class.") I agree that any company has to set up its own strong identity to succeed and not just take a "me too" track. 
Ariella 11/4/2014 | 9:43:13 AM
Re: job cut @KBode Hard to get ahead with a "loser mentality" (It makes me think of the tracked students who recognize they're in the "dummy class.") I agree that any company has to set up its own strong identity to succeed and not just take a "me too" track. 
KBode 11/4/2014 | 9:21:48 AM
Re: job cut I do, in time. When bought, SoftBank's Masayoshi Son criticized a "loser mentality" among company employees and said it would take probably two to three years to get it on the right track. There are some positives going on in terms of their wholesale MVNO numbers, and I would expect the network to continue to improve. The only thing that can hold it back is dumb decisions in terms of pricing and marketing....right now they're engaged in a kind of "me too" approach in terms of responding to T-Mobile, and they need to unveil some kind of of original innovation of their own to differenatiate themselves.
Ariella 11/4/2014 | 8:57:21 AM
Re: job cut @Kbode does that mean that you expect the company will succeed in turning itself around and becoming a success?
KBode 11/4/2014 | 8:48:41 AM
Re: job cut Many of these problems were more because of Sprint missteps, and not necessarily because of the economy. The company stumbled through a botched acquisition of Nextel, then bet on the wrong horse in WiMax, suffered through some rather bland management decisions in terms of competitive options, and is now going through a very dramatic personality transition after being acquired by SoftBank. They're cleaning house and rebuilding from the ground up.
Ariella 11/4/2014 | 8:29:22 AM
Re: job cut LOL @Joe all true. But even people who have lost jobs and then found jobs again are not necessarily fully recovered. Some are earning less than they were 6 years ago, and inflation (low, though, it may be) has been cutting their real income even more. 
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