Sprint layoffs likely as part of cost-reduction plan

Company hopes to save up to $2.5 billion

layoffs laid off downsize job cuts

Sprint will likely cut its 31,000-person workforce as part of up to $2.5 billion in cost reductions in the next six months, a company spokesman said Friday.

"It's likely some jobs will be impacted by this [cost-cutting] process, but it's premature to talk about details," said Sprint spokesman David Tovar in a telephone interview on Friday.

In addition to 31,000 workers, the company also employs about 30,000 contractor employees, he said. Sprint, with 57.7 million customers, fell to the nation's fourth largest wireless carrier in August, behind T-Mobile.

The cost-cutting plan of $2 billion to $2.5 billion was described in an internal memo to employees, sent by new chief financial officer Tarek Robbiati, and distributed earlier this week, Tovar said. "We just want to make sure employees know what's happening," he said.

Robbiati's memo was first reported by The Wall Street Journal on Thursday night.

The memo was distributed a few days after Sprint said it would not participate in an auction of low-frequency wireless spectrum. But Tovar contended that the two announcements are not connected with any sudden changes in Sprint's long-term restructuring plan, which CEO Marcelo Claure has described many times since taking over a year ago.

"We have plenty of spectrum, the most of any other U.S. company, and we don't need to participate in the auction," Tovar added. "We're going full speed ahead on our network plan and the decision not to participate in the auction has nothing to do with what you're hearing about cost reductions."

Tovar added: "Exciting things are happening at Sprint and we're upbeat about a lot of things. You've heard our CEO talk many times about cost structure not being in line with the industry and the need to reduce costs and we'll leave no stone unturned in terms of opportunities to cut costs."

Sprint has cut about $1.5 billion in expenses in the last 12 months.

Copyright © 2015 IDG Communications, Inc.

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