Sprint’s plans to cut jobs cost the carrier a bit more than originally planned, with additional costs possible through the middle of next year.
The carrier noted in a Securities and Exchange Commission filing that it took an additional $105 million charge during its most recent quarter on top of the previously reported charge of $160 million related to cutting 452 jobs at its Overland Park, Kan., headquarters. Sprint said the original estimate was based on “an existing employee benefit severance plan and based on the information available as of the date of the original filing.”
The carrier said that in addition to the updated amount, “additional material charges may occur in future periods,” with most of the charges expected to result in “cash expenditures” by June 30, 2015. These job cuts are expected to be completed by March 31, and will include both management and non-management positions.
The change is not related to the announcement earlier this week that it plans to cut an additional 2,000 jobs. RCR Wireless News spoke with Sprint CFO Joe Euteneuer following the announcement of the latest round of job cuts to gain more insight into the carrier’s workforce plans.
A company spokesman said Sprint had not yet decided from which parts of the organization the cuts would come, but that they would likely be companywide. Sprint had approximately 33,000 employees at the end of its second fiscal quarter ended Sept. 30, which was down from around 36,000 employees earlier in the year.
In announcing the latest cuts, Sprint CEO Marcelo Claure said the move would produce labor cost savings of $400 million on an annualized basis, including both internal and external labor. Claure did add that the company was “selectively investing” in some parts of the organization, noting plans to hire 200 employees to staff a call center at its Overland Park headquarters targeting high-value customers.
The job cuts come as Sprint continued to suffer mixed operating results. The carrier reported that during its most recent quarter it managed to actually grow its overall customer base, but continued to bleed high-value postpaid customers.
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