Wireless carrier Sprint Corp. (NYSE: S) filed a Form 8-K/A with the U.S. Securities and Exchange Commission, saying that the company is adding about $105 million to the approximately $160 million it reported as severance and related costs for the just-ended second fiscal quarter. The reason for the change appears to be that Sprint is firing people more quickly than it had expected to.
In the filing the company said:
The Company previously reported and recognized a charge of approximately $160 million in the quarter ended September 30, 2014 for severance and related costs. This charge was determined based on an existing employee benefit severance plan and based on the information available as of the date of the Original Filing. The Company recognized an additional charge of approximately $105 million in the three month period ended September 30, 2014 for severance and related costs relating to this workforce reduction plan. Additional material charges may occur in future periods. The majority of the above charges is expected to result in cash expenditures by June 30, 2015.
When Sprint reported earnings earlier this week, the company said it would cut another 2,000 jobs as it seeks to optimize its cost structure. The company is targeting $1.5 billion in annualized cost reductions compared with 2014 spending levels. About $400 million of the cost reductions will come from this and other recent employee firings.
The $160 million second-quarter charge was expected to cover the severance payments to 452 employees fired in October from the company’s main office in Overland Park, Kan. Sprint had already fired 477 employees at its headquarters this year, bringing total job losses at corporate headquarters to 929 of around 7,500 people before the first cuts were made.
Sprint’s shares were inactive in Friday’s premarket, having closed on Thursday at $4.69 in a 52-week range of $4.65 to $11.47. The 52-week low was set Thursday.