Qwest lays off 4,000, revises earnings estimates

Qwest lays off 4,000, revises earnings estimates

Qwest Communications International will lay off 4,000 workers, the company said Monday, and also revised its earning expectations downward for this year, citing the ongoing economic slump.

By the end of the first quarter of 2002, the Western US broadband and local telecommunication service provider will cut its workforce from 66,000 to 62,000. An additional 1,000 staff positions will be eliminated, from departments such as public relations and legal, according to Tyler Gronbach, vice president for corporate communications at Qwest, based in Denver.

The company will also attempt to cut overhead costs through the hiring of 1,000 mostly commission-based salespeople, Tyler said.

Qwest now expects revenue of about $US20.5 billion for the fiscal year 2001. This is a downgrade from second-quarter estimates of $21.3 billion to $21.5 billion. Earnings before interest, taxes, depreciation, and amortization (EBITDA) will decrease to about $8 billion, down from $8.5 billion to $8.6 billion, the company said.

Additionally, Qwest expects the 2002 capital budget to drop almost $2 billion, from $7.5 billion to $5.5 billion, mostly through cost cutting and reductions in capital purchases, Tyler said. The company said in the statement that it expects to become cash-flow positive in 2002 through the combination of the layoffs and spending cuts.

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