OVERLAND PARK, Kan.-Sprint Corp. unveiled an outline for a three-year growth and cost-reduction plan designed to save the company more than $1 billion per year.
The plan is linked to Sprint’s recently announced initiative to realign its operations from the current three-tiered focus on local telecommunications, global wireline voice and data, and wireless services to a two-tiered focus on business and consumer market segments. The realignment focus, which was announced last week, included the promotion of Sprint PCS President Len Lauer to chief operations officer of Sprint.
The cost-reduction plan calls for Sprint to capture a greater share of customers’ spending on communications services through bundled offerings; leveraging and expanding Sprint’s nationwide distribution channels to sell its complete portfolio of wireless and wireline products; improved sales productivity from a unified Sprint sales team focused on business customers; and gaining access to previously untapped consumer markets through its recently announced national local strategy that has expanded its local presence from 5 percent to more than 80 percent of the U.S. population.
“One of Sprint’s chief advantages is our customer base of over 26 million unique users,” explained Gary Forsee, chairman and chief executive officer of Sprint. “Increasing penetration of our products and services into that existing base by even 1 or 2 percent can equate to hundreds of millions of dollars in new revenue.”
Sprint noted it has already reduced its net debt by more than $3.5 billion during the past two quarters, which is more than 50 percent of its planned two-year $7 billion net debt reduction goal.
Forsee added that Sprint is still looking at recombining its currently separately traded “PCS” and “FON” stocks, which analysts expect to happen sometime next year.
“While we have no timetable for recombining our tracking stocks, we continue to believe, as we said at our annual shareholders meeting, that a recombination of the stocks is likely at some point,” Forsee said.
