Sprint to Lay Off More Than 2,000
The Overland Park, Kan.-based CDMA operator announced this afternoon that it plans to eliminate 2,000 to 2,500 positions within the company. Sprint says that it expects to reduce its labor costs by $350 million with the move, and many of the layoffs will occur by the end of the year. (See Sprint Cutting Up to 2,500 Jobs.)
Sprint has already made moves to cut its workforce this year. It announced in January that it would slash 8,000 jobs in 2009. The company has also outsourced the day-to-day running of its network to Ericsson AB (Nasdaq: ERIC) in a bid to cut costs. (See Sprint Slashes 8,000 Jobs and Ericsson, Sprint in $5B Managed Services Deal.)
On the financial side, Sprint expects to recognize a charge of approximately $60 million to $80 million during the fourth quarter of 2009 for severance and related costs associated with the workforce reduction. The company says that, at the end of the third quarter 2009, it had a balance of $5.9 billion in cash, cash equivalents, and short-term investments, and that it expects to continue to generate positive free cashflow during the fourth quarter of 2009.
Nonetheless, the operator is reportedly ready to cut another check for Clearwire even as it mulls more pink slips. The Wall Street Journal reported on Sunday that Sprint will put up the lion's share of the money for a further $1.5 billion to help Clearwire deploy its WiMax network. (See Report: Clearwire to Get $1.5B Funding Bump.)
— Dan Jones, Site Editor, Unstrung