Chairman of SoftBank Group, Masayoshi Son reported that thousands of employees will be slashed at Sprint Corp (NYSE:S), as part of a restructuring effort at the U.S. wireless carrier, which was acquired by SoftBank in 2013.
Speaking during an earnings presentation today, Mr. Son said a number of cost-cutting moves were being started at Sprint to cut $2 billion in expenses every year and reported the process would include ‘thousands’ of layoffs. He said $2 billion is a minimum goal, and the company should go even deeper.
Comments from Mr. Son comes after Sprint announced yesterday that it added more post-paid users than it lost in the second quarter, and had its lowest cancellation rate in the history of the company. Though, its subscriber additions still lagged behind those of competitor T-Mobile US. Sprint posted a net loss of $585 million for the latest quarter, highlighting the fact that its losses are continuously mounting despite winning back some users.
SoftBank announced mix profit today, posting net earnings of ¥213 billion that missed consensus forecast of ¥262 billion. Operating earnings for the quarter ended September jumped 39 percent to ¥342.21 billion, as compared to ¥245.59 billion one year ago.
Recently, Mr. Son reassured his dedication to turn around Sprint by boosting the stake of SoftBank in the U.S. wireless carrier. He also bought a house located in Overland Park, Kan., an indication that he would now be spending most of his time near Sprint’s headquarters.
Mr. Son said he is also looking forward to make heavy investments in startups and other businesses every year to strengthen Softbank’s already huge portfolio, which include a stake of 32 percent in Alibaba Group Holding, a Chinese e-commerce giant.
In the meantime, SoftBank’s domestic mobile segment is facing tough competition from rival carriers and mobile virtual-network operators, which are offering low-priced plans.
