Verizon Wireless to slash 8,000 jobs

Verizon, the second-largest US telecoms group, is to cut a further 8,000 jobs in response to the recession and the loss of fixed-line business. The cuts, equivalent to 3.4 per cent of Verizon’s workforce, come on top of a similar sized reduction in headcount over the past 12 months and showed, said Craig Moffett of Bernstein Research, that “no company is immune to the severity of the current downturn”.

Discussing Verizon’s second-quarter results, which included a 7.2 per cent fall in net income to $3.2bn, John Killian, chief financial officer, said: “Clearly the broader economic issues are affecting the business.

“Although we are taking steps to mitigate the negative impacts of the economy in the short term, we also need to more significantly reduce the wireline cost structure over the next 12 to 18 months.”

Operating revenues in Verizon’s global enterprise business segment, which mainly serves big companies, fell 6.7 per cent to $3.7bn as customers reacted to the downturn. Wholesale revenues fell 7.5 per cent to $2.4bn.

Revenues in Verizon’s fixed-line business fell 5.2 per cent to $11.5bn in spite of growth in fibre optic-based video services and broadband services. The number of fixed lines served by Verizon fell by a further 630,000, or 12.3 per cent, to 19.7m, mostly reflecting wireless substitution.