Thousands of jobs are expected to be axed at Sprint, many at the start of 2016, after lower than expected profits were reported, and the company gets tough on driving down costs. The job loss was apparently confirmed by the CEO of Sprint’s parent company SoftBank, during a conference call announcing financial figures from the last three months.
Sprint CEO Marcelo Claure also spoke about the cuts — without mentioning specific numbers — stating he wants to make them before the end of January next year. The timing is important, because later in 2016, the company intends to cut severance pay by 50-percent. Quoted by Recode, Claure said “Nobody likes to be in a company that is doing layoffs. The way you beat that is being very honest and transparent.”
The news comes after its financial earnings report showed a 6-percent drop in operating revenue, which was lower than expected. Despite this, the job cuts don’t come as a major surprise. At the beginning of October, a leaked memo discussed how the recent spate of cost cutting hadn’t helped balance the books, and mentioned the introduction of a hiring freeze, and talk of “inevitable” job reductions.
Beyond this, Sprint will initiate further cost cutting strategies, from employees dealing with their own rubbish, and executives moving to Uber and other transport services, rather than using private town cars. Additionally, a free snack program run at the company’s headquarters is expected to end. Claure said it’s “looking at every single line item” to push down costs. “We have a clear plan to return Sprint to profitability,” said Claure.
The earnings report did contain some good news. The press release shows Sprint added 237,000 postpaid subscribers over the last three months, but that includes nearly 200,000 conversions from Sprint-powered brands Virgin and Boost. Sprint is currently the fourth largest mobile network in the U.S., by subscribers, after falling behind T-Mobile earlier this year.