OVERLAND PARK, Kan.--(BUSINESS WIRE)--Nov. 9, 2009--
Sprint Nextel Corp. (NYSE:S) today announced that the company will take
actions in the fourth quarter of 2009 to reduce internal and external
labor costs by at least $350 million on an annualized basis. The actions
include the elimination of 2,000 to 2,500 positions within the company.
The impact on geographic locations will vary, and many impacted
positions will be eliminated by December 31, 2009.
The reduction impacts positions companywide, including those previously
announced this month in the Wholesale organization, as well as a
reduction in contractor and other outside labor. The company is taking
this action in a careful manner to ensure that there is no impact on the
improved customer experience that has been reflected in much higher
levels of satisfaction in customer surveys and in independent
performance tests. Sprint has pledged to not waver on the company’s
commitment to quality service and products.
Sprint has seen a notable reduction in calls per subscriber to customer
care and increased customer satisfaction resulting from customer service
improvements for seven sequential quarters. In this period, the company
has been able to discontinue the use of 27 call centers as call volume
has decreased in the wake of service improvements. Furthermore, the
company’s networks continue to operate with current best-ever metrics
and has resulted in Sprint being named by PC World Magazine as having
the most reliable network.
The labor cost reductions are the latest action in the company’s efforts
to make its cost structure more competitive in the industry and to
remain financially secure in a challenging economic environment. At the
end of the third quarter 2009, the company had a balance of $5.9 billion
in cash, cash equivalents and short-term investments, and said that it
expects to continue to generate positive Free Cash Flow during the
fourth quarter of 2009.
Sprint will provide severance benefits and outplacement services for
impacted employees. The company expects to recognize a charge of
approximately $60 million to $80 million during the fourth quarter of
2009 for severance and related costs associated with the reduction.
ABOUT SPRINT NEXTEL
Sprint Nextel offers a comprehensive range of wireless and wireline
communications services bringing the freedom of mobility to consumers,
businesses and government users. Sprint Nextel is widely recognized for
developing, engineering and deploying innovative technologies, including
two wireless networks serving more than 48 million customers at the end
of the third quarter of 2009 and the first and only 4G service from a
national carrier in the United States; industry-leading mobile data
services; instant national and international push-to-talk capabilities;
and a global Tier 1 Internet backbone. The company’s customer-focused
strategy has led to improved first call resolution and customer care
satisfaction scores. For more information, visit www.sprint.com.
SAFE HARBOR
This news release includes "forward-looking statements" within the meaning of the securities laws. The statements in this news release regarding the reduction in labor costs, business outlook, liquidity and expected performance, as well as other statements that are not historical facts, are forward-looking statements.
The words "estimate," "project," "forecast," "intend," "expect," "believe," "target," "providing guidance" and similar expressions are intended to identify forward-looking statements. Forward-looking statements are estimates and projections reflecting management's judgment based on currently available information and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. With respect to these forward-looking statements, management has made assumptions regarding, among other things, customer and network usage, customer growth and retention, pricing, operating costs, the timing of various events and the economic and regulatory environment.
Sprint Nextel believes these forward-looking statements are reasonable; however, you should not place undue reliance on forward-looking statements, which are based on current expectations and speak only as of the date of this release. Sprint Nextel is not obligated to publicly release any revisions to forward-looking statements to reflect events after the date of this release. Sprint Nextel provides a detailed discussion of risk factors in periodic SEC filings, including its annual report on Form 10-K for the year ended December 31, 2008 in Part I, Item 1A, and its subsequent Quarterly Reports on Form 10-Q in Part II, Item 1A.
Source: Sprint Nextel Corp.
Sprint Nextel Corp.
Media Contact:
James Fisher,
703-433-8677
james.w.fisher@sprint.com
or
Investor
Relations Contact:
Yijing Brentano, 800-259-3755
investor.relations@sprint.com
