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Source: Reuters |
AT&T (NYSE: T) said on Friday it would cut its workforce by 1.5 percent, or 4,600 jobs, as it faces rising costs for deploying new, high-speed Internet and video services and declining traditional phone sales.
The reductions will primarily hit management-level employees, resulting in a first-quarter pretax charge of $374 million.
The biggest U.S. telecommunications provider, which has about 310,000 employees, said in a regulatory filing that its head count would remain stable in 2008 as it hires more workers to support growth areas.
AT&T said the job cuts, affecting its wireline telephone business in the United States and around the world in mostly “noncustomer-facing areas,” are part of its efforts to streamline the company.
AT&T shares were up 50 cents, or 1 percent, to $38.07 in morning trade on New York Stock Exchange after the news.
AT&T Spokesman Walt Sharp said the company was in the process of notifying employees affected by the job cuts.
Last month, smaller telecom provider Qwest Communications International said it was cutting jobs by offering a “voluntary separation program” to less than 2 percent of its workers, or less than about 740 workers. Qwest cited a decline in phone lines.
AT&T, which posted a 2007 fourth-quarter profit of $3.1 billion, has made several acquisitions in recent years, including SBC Communications (NYSE: SBC) and BellSouth.