Wireless phone company Sprint Nextel Corp. said Friday it plans to slash 4,000 jobs and close 125 retail locations to gird itself for an expected slowdown in subscriber growth and revenue.
Shares in the company, which has been struggling to keep up with rivals AT&T Wireless and Verizon Wireless, fell 26 percent in midday trading.
The job cuts and store closings aim to cut $700 million to $800 million a year in labor costs starting at the end of 2008. The company said it will book a charge in the first quarter to cover severance costs but did not disclose the amount.
Sprint said it will also close 4,000 of its 20,000 third-party distribution points, such as stalls inside other consumer-electronics retailers. The retail store closures represent 8 percent of its 1,400 company-owned shops.
General Electric Co. delivered some cheer Friday to worried investors, saying its quarterly profit rose 4 percent and reaffirming its outlook for 2008.
The conglomerate’s big-ticket business – jet engines, railroad locomotives and water treatment plants – powered GE’s profit, posting $3.4 billion, or 26 percent more than the fourth quarter of 2006.
Total net income rose to $6.7 billion, or 66 cents a share, in the fourth quarter ended Dec. 31, from $6.44 billion, or 62 cents a share, a year earlier.
A $25 billion collapsed buyout offer and higher borrowing costs have prompted Sallie Mae, the nation’s largest student lender, to lay off about 3 percent of its work force.
The embattled SLM Corp. said Friday it will slash 350 jobs from an 11,000-worker staff to help cut costs 20 percent by 2010.
“The tightening credit markets have made our costs higher,” company spokesman Tom Joyce said.
The company lost $344 million in its latest reported quarterly results.