Qwest to cut 11,000+ jobs

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Cutting ~12,800 jobs in the next two years doesn't sound like a *minor* restructuring. It looks as though they're scrambling for cash, doing that large of a hatchet job and selling investments. I'd hate to be living in Denver hearing that.

Fair use, for educational purposes: www.thestreet.com/_yahoo/...69678.html

Update: Qwest to Cut 11,000 Jobs

By Jamie Paton

TheStreet.com/NYTimes.com Staff reporter

9/7/00 4:48 PM ET

Updated from 12:54 p.m. EDT

Telecommunications giant Qwest Communications (Q:NYSE - news) said Thursday that it would eliminate 11,000 jobs within the next 15 months as part of a major realignment that follows its recent merger with US West.

The Denver-based company, seeking to streamline its businesses, said it intends to cut 4,500 jobs by the end of 2000 and another 6,500 positions by the close of 2001, about 15% of its total workforce. In addition, 1,800 contractor jobs will be eliminated, the company said.

Qwest finished Thursday regular trading down $2.75, or 5%, at $48.75.

Qwest is "blending the businesses and cultures to further Qwest's position as an entrepreneurial, large-cap growth company," said Joseph Nacchio, Qwest chairman and chief executive, in a statement. "We are relentlessly pursuing growth and uncovering new areas of customer demand."

The extent of the job cuts is greater than previously expected. In early August, Nacchio had said between 2,000 and 4,000 positions -- mainly in the finance, legal and communications departments -- would be eliminated by the end of 2000.

The large number of cuts, though, failed to surprise one analyst. "The layoffs don't scare me," said James Linnehan of Thomas Weisel Partners. The firm has not done any underwriting for Qwest.

"If you can find that many people to lay off, then they probably need to be laid off," added Linnehan, who rates Qwest stock a strong buy, "And I applaud them for that."

At the same time, Qwest said it has introduced a new compensation plan for remaining employees, linking pay to company performance. Benefits include stock options, quarterly bonuses and a stock purchase plan that enables workers to purchase Qwest stock at a 15% discount.

Qwest also announced that it would sell $1 billion of investments in about 15 companies, including a portion of a Global Crossing (GBLX:Nasdaq - news) stake obtained through the acquisition of US West.

The deal with the regional telephone carrier, which was completed in June, more than doubled Qwest's size.

Qwest, meanwhile, raised its revenue estimates for 2000 and 2001. Revenue now is expected to reach between $18.8 billion and $19.1 billion, up from a target of $18.5 billion, Qwest said. In 2001, Qwest anticipates revenue between $21.3 billion to $21.7 billion, up from a goal of $21 billion.

-- Deb M. (vmcclell@columbus.rr.com), September 08, 2000


Deb, the grapevine says that the layoffs won't be that extensive: it's a ploy to motivate workers through fear, so that they whine less about the restructuring, which will involve relocation for many middle managers. I imagine die-hard Denver residents will be less than thrilled if they are forced to relocate here, but they are more likely to do so under the Move-or-Be-Downsized scenario.

Sounds likely to me, although Qwest hasn't been doing that well for the last two fiscal quarters.

-- (kb8um8@yahoo.com), September 08, 2000.


I hope the grapevine is right then. I believe LCI/Qwest hasn't had that large of cut, ever, and uaually the cuts come unannounced. Somehow though, I think there's going to be a decent amount of cuts, especially because of duplication and poor U.S. West service.

I guess we'll see soon enough...

-- Deb M. (vmcclell@columbus.rr.com), September 08, 2000.

Nove ll slashes jobs Network software maker to cut 16% of work force, take $45M charge September 6, 2000: 9:25 a.m. ET

NEW YORK (CNNfn) - The troubled software maker Novell Inc. said Wednesday it will cut 900 jobs, or 16 percent of its work force, and take a restructuring charge of about $45 million in its fiscal fourth quarter.

The job cuts, which were widely expected, come after the Provo, Utah-based maker of Internet software reported that third quarter profits tumbled 83 percent to $8.6 million and earnings per share sank to 3 cents from 14 cents a year earlier -- although the results did top Wall Street forecasts.

Novell said Wednesday's restructuring is expected to cut costs by roughly $25 million a quarter starting the next fiscal year.

Morgan Stanley analyst Chuck Phillips told CNNfn.com that he expected an announcement since the company had discussed making changes. "It's in line with them getting the cost down to the reality of what their revenue opportunities are," Phillips said.

"This doesn't solve their problems long-term, but you can't continue to run a business and ignore the fact that your top line isn't there, so I think it's a pragmatic move. They probably can't cut their way to prosperity - sooner or later they're going to have to get their revenue line growing," Phillips said.

"We're reducing expenses overall, and we are also freeing up dollars to spend on key sales, marketing and development initiatives that are part of our strategic focus," Novell Chairman Eric Schmidt said in a statement.

Philliips doesn't see Wednesday's moves as solving Novell's woes, given the company's persistent misses in product development, but sees this as a positive first step.

"There's no quick fix because product opportunities and market shifts took years to develop and they missed them and continued to go in the wrong direction. It's hard to quickly correct that, and I think if it's going to be fixable it's going to take some time and probably involve some acquisitions," he said.

-- this one too (corporate greed @ strikes. again), September 08, 2000.

I am now at the age that little of this effects me. I watch with some amusement. It seems to me that the companies are saying to their employees; " if you want to survive, you must unionize and work for a more socialist government".

Their approach seems to be working. The greens are doing better each election.


-- DB (Debunker@nomore.xxx), September 08, 2000.

EVER HEAR ABOUT "THE LAW OF THE JUNGLE"?? The losers can find jobs in the 2 million that were created as the Net grows.

OFFICE MAX laid off 120 sales people who sold to Corporate Accounts. They will be replaced by the Net effort and the Net catalog. The sales people would do well to get training in high tech. There is little future in selling "office supplies" when there is an internet to order from. OFFICE MAX is not the last company that will displace Sales People It will happen in many more Retail settings. However.......like Buggy Whips sales people, the Retail people can find jobs selling the machines or the systems that replaced them.

Qwest: "If you can find that many people to lay off, then they probably need to be laid off," added Linnehan, who rates Qwest stock a strong buy, "And I applaud them for that."

CASE CLOSED. .........................

NOVELL?? They are lucky they are still around and even that is emporary.

-- cpr (buytexas@swbell.net), September 08, 2000.


Find jobs on the net - hello!!! Haven't you read that quite a few Internet companies are going belly-up because they can't turn a profit? Why don't you do a little more research, there have been other companies who have done large lay-offs as well. Bank of America (?) recently announced that they were laying off THOUSANDS of workers. I also believe that earlier Boeing was planning on also laying off THOUSANDS of workers too. Sounds like the jungle is getting a bit wilder. Sounds like they're roaring "Recession".

Oh, I forgot, you're the one who thinks that oil wouldn't go to $35/barrel. Go to your shrink Ceep, sounds like you need more counseling in "reality awareness"...

-- Deb M. (vmcclell@columbus.rr.com), September 08, 2000.


Sorry, case still opened. Didn't know that you had jungles in Tejas. But after you get your first Green Govenor who places restrictions on real estate development, you will remember this post. It is coming. Dan Quayle in cowboy boots won't stop it. Not my idea of how things should go, but remember you heard it here. Tejas is not immune. I would ask you to write me in 20 y, but I am too old. You should live for a year or two in Washington or Oregon. It would give you a view of the future.


-- DB (Debunker@nomore.xxx), September 08, 2000.


Hoz-it-goin. CPR is ok, but seems to be ny-eve as we say here in the Northwest. I had forgotten the Dan in cowboy boots article. Yep, my experience agrees with yours. Looks to me that all of this corporate activity is leading us towards the end that you have described. Ayn Rand will fail. So it goes.


-- Gregor (Gregor10001@yahoo.com), September 08, 2000.

Here's a link to the July 28, 2000 article that tells of Bank of America's planned layoff of 10,000 employees:


As for Boeing, they've project layoffs as being 20,000 - 24,000 employees, starting in 1999 and ending ~ 2001. URL:

http://seattletimes.nwsource.com/news/business/html98/altjobs_010399.h tml

-- Deb M. (vmcclell@columbus.rr.com), September 08, 2000.

Remember Gore is taking responsibility for the economy.

-- Gore Gore (Al@joe.bill), September 09, 2000.

Hells Bells, will they be coming to our County? Then we must help them. Heaven help, it could be me!

-- Influxe of humans (destined@yourlife.com), December 29, 2000.

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