Deutsche Telecom’s US mobile operation, T-Mobile USA, is to cut a further 900 jobs, following the unit’s failed $39bn purchase by AT&T late last year. The latest cuts come on top of around 1,900 job losses announced earlier this year.
Last week T-Mobile USA said it has seen revenue and profit deteriorate over the past year, and is now stepping up its efforts in the market, bolstered by the rollout of an LTE network.
Revenue for the US operation during the first quarter of 2012 increased two per cent year-on-year to reach €3.8bn, while adjusted EBITDA grew 12.9 per cent to €1bn. However, this was in part due to exchange rate gains made by the US dollar. In local currency, revenue decreased by 2.3 per cent, although adjusted EBITDA increased by eight per cent.
“Relaunching the T-Mobile brand on the US market and significantly enlarging the sales network in the country are important steps in implementing the strategy,” the firm said in its statement. “In addition, initiatives for cutting costs and reducing churn are having a positive impact. There was a 0.1 percentage point improvement year-on-year in branded contract customer churn, representing a 0.5 per cent improvement on the fourth quarter.”
So it looks like the cost cutting initiatives are set to continue. Most of the recently announced job cuts are to come from the closure and consolidation of call centres.
“We are restructuring the organization and optimizing operations so that we can make critical decisions better and faster in response to market and customer demands. Further, by reducing our cost structure and streamlining operations, T-Mobile will be able to invest in areas where we anticipate the strongest return: modernizing our 4G network; aggressively pursuing the B2B segment; and re-launching our brand,” the company said.
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