Sprint (NYSE: S) indicated it is cutting more jobs as it seeks to slim down and become more efficient amid intensifying competition. Sprint did not say how many jobs it is planning to cut, but the cuts come on top of at least 1,400 the company made earlier this year.
Sprint said it will book a $160 million charge related to severance costs associated with the new cuts, according to a filing Sprint made with the Securities and Exchange Commission. The carrier said the restructuring is expected to be largely completed by Oct. 31, and will include management and non-management positions.
The new cuts are not totally a surprise. Indeed, Sprint CEO Marcelo Claure, who took the helm from Dan Hesse in mid-August, hinted in September that cuts would be coming. "In a time of a turnaround, which is Sprint, we are going to focus only on must-haves, all the nice-to-haves are going to go," he said at an investor conference, according to a Seeking Alpha transcript of his remarks. "And I can tell you that we have a pretty extensive list that the company has accumulated of nice-to-haves and also the first that are going to go."
It's unclear how many jobs will be cut as a result of the new changes. Sprint spokesman Scott Sloat told FierceWireless that the carrier is "still working through the process" and "cannot provide numbers or locations for the job reductions."
However, Sloat told Bloomberg the cuts will affect employees in IT, network and technology who had been working on the company's Network Vision network modernization project. The main phase of that project, which included upgrading Sprint's 3G CDMA network and deploying LTE in the 1900 MHz band, was largely completed around mid-year. Sprint has since moved on to densifying its network and deploying LTE in the 800 MHz and 2.5 GHz bands, as part of its tri-band LTE Spark service. "Since Network Vision is largely complete, we are staffing accordingly," Sloat said.
The new cuts come as Sprint has been ramping up competition against Verizon Wireless (NYSE: VZ) and AT&T Mobility (NYSE: T) by offering data buckets twice the size of its larger competitors for shared data plans. Sprint is also trying to undercut T-Mobile US (NYSE:TMUS) with a $60 per month unlimited plan for individual customers (it's $50 if they sign up for a new iPhone 6 or 6 Plus).
Additionally, the cuts come after Sprint in March disclosed it would cut at least 1,400 jobs across the country, and perhaps more, as it closed call centers, slashed jobs related to refurbishing phones and shut down underperforming retail stores. The company took a $165 million charge related to those cuts.
As part of those cuts, Sprint shuttered three customer care call centers and cut back operations at three others. The carrier closed call centers in Elmsford, N.Y.; near its headquarters in Overland Park, Kan.; and Sacramento, Calif., and cut back operations at call centers in Orlando, Fla.; Temple, Texas; and another Sacramento facility. Sprint also shut down 55 of its worst-performing retail stores.
According to the Kansas City Star, Sprint has about 33,000 employees, down from 36,000 the company reported as of the end of March, indicating the job cuts in March were more than the estimated 1,400. A Sprint spokeswoman did not immediately have a comment on how many jobs were cut as a result of the changes announced in March.
- see this SEC filing
- see this Bloomberg article
- see this Kansas City Star article
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