Sprint Corp. (NYSE:S) turns to job cuts to compensate for losses
Sprint (NYSE:S) is under a burden of heavy costs it reported in the second quarter. The company added 105 million to the 160 million dollars severance and other related costs. The company reported the costs to U.S Securities and Exchange Commission which deals with compensating those people who are released by a company. Sprint (NYSE:S) has been releasing a lot of employees, and that too in a quick span of time. In the report Sprint (NYSE:S) admitted to the fact that it underestimated the workforce cut initially when the company was drawing up an estimate for the severance charges uptil 30th September.
But additional charges related to the same matter came up and now Sprint (NYSE:S) will need to add another 105 million to the 160 million dollars it originally reported. Sprint (NYSE:S) earlier reported its second quarter results and it decided, on the basis of those results, that it will need to cut down 2000 jobs in order to cope with its cost structure. Sprint (NYSE:S) is eyeing 1.5 billion in an annual cost reduction for 2014; 400 million dollars has come from the recent firings, along with the current one.
Sprint (NYSE:S) is in dire need of money because the share price was floating low in the past couple of months and hit a 52 week low last Thursday. In such a scenario, reduction of workforce seemed the only option to make some quick money. Sprint (NYSE:S) thought that 160 million dollars would prove to be enough to compensate 452 employees fired last month but it seemed like they underestimated the severance cost width.
Sprint (NYSE:S) fired 477 employees earlier this year, bringing the total job cut to 929 out of 7,500 employees working at Sprint (NYSE:S). Its shares hit a 52 week low, posting 4.69 dollar per share and in the past three days, Sprint (NYSE:S) scored low, consistently losing money and potential investors and earning a bad name for its stock. In the past quarter, Sprint (NYSE:S) fell well short on earnings per share and revenue predictions as well.
Sprint’s (NYSE:S) stock was down by 16.45 percent in intraday trading and posted a loss of 765 million dollars in the second quarter after it lost a plethora of postpaid subscribers. On the other hand competitors are constantly growing around Sprint Corp. (NYSE:S). There’s also an innuendo going around that Sprint Corp. (NYSE:S) won’t last much longer or at least will lose its strong hold. Sprint Corp. (NYSE:S)’s stock fell by 56.37 percent year to date.
The only thing that can save Sprint Corp. (NYSE:S) from being humiliated further is new subscribers. If somehow Sprint Corp. (NYSE:S) can devise a strategy to attract potential subscribers, it will start growing again. Sprint Corp. (NYSE:S) is in need of heavy advertising, marketing and promotional strategies to boost its sales and profits. The main thing Sprint Corp. (NYSE:S) should target right now is customers: it needs customers in bulk.