Mar 5, 2020 - Economy & Business

AT&T plans to slash jobs as part of multi-billion cost-cutting effort

Photo: Saul Loeb/AFP via Getty Images

AT&T will look to cut tens of billions of dollars in costs over the next few years, including job cuts in the near term, AT&T president John Stankey said at a Morgan Stanley conference this week.

Why it matters: Critics were quick to point out that AT&T's cost-cutting plans come despite previous promises to increase investment and create jobs as part of the case for corporate tax cuts and the easing of net neutrality rules.

Driving the news: Speaking at the Morgan Stanley Technology, Media & Telecom Conference on Tuesday, Stankey said that the company has been focused on "10 broad initiatives that we believe can generate double digits of billions over a three-year planning cycle."

  • The efforts are roughly evenly split into those taking place over the next 12 months, those that will take one to two years, and those that will take more than two years.
  • Headcount reduction is part of the first year's cost-cutting efforts, Stankey said, with opportunities in call centers and other areas.
  • The company plans to focus DirecTV on areas with few broadband options, with its recently launched AT&T TV as the focus for live TV customers elsewhere.

What they're saying: An AT&T spokesman noted that the company invested more than any other company in the U.S. between 2014 and 2019, including 20% more in capital expenditures than Verizon.

  • As for the tax cut pledge, a representative said, "When tax reform was enacted in late 2017 we announced our intent to invest an additional $1 billion in the U.S. in 2018, and we met that commitment."

Yes, but: AT&T plans to spend in the "$20 billion range" on capital expenses this year, down from $23.7 billion last year and $23.2 billion in 2018.

Go deeper: AT&T launches live TV service aimed at taking on cable

Go deeper

Oil giants announce steep cutbacks

Photo: Karol Serewis/SOPA Images/LightRocket via Getty Images

Royal Dutch Shell and Total this morning announced plans to sharply cut spending and freeze share buyback plans.

Why it matters: The moves signal how cratering demand from COVID-19 and the collapse in prices are upending the outlooks for companies large and small.

Saudi Aramco announces spending cut amid coronavirus pandemic

Amin Nasser, president and CEO of Saudi Aramco. Photo: -/AFP via Getty Images

Saudi Aramco plans to cut 2020 spending by billions of dollars below last year's levels as the spread of the novel coronavirus craters global oil consumption and pushes down prices.

Why it matters: Aramco is the world's largest oil-producing company. Sunday's announcement underscores how COVID-19 and the oil market's upheaval is affecting the energy landscape.

Memo: Morgan Stanley promises no layoffs in 2020

Photo: Stephen Chernin/Getty Images

Morgan Stanley CEO James Gorman today pledged that the Wall Street firm will not reduce headcount in 2020, according to an internal memo seen by Axios.

Why it matters: Morgan Stanley employs around 60,000 people, and every job counts at a time when millions of people are losing them.