Sprint says aims to slash costs up to $2.5B, layoffs loom

Sprint Plans to Cut Costs by Up to $2.5 Billion
Sprint Plans to Cut Costs by Up to $2.5 Billion

Wireless carrier Sprint Corp S.N. said on Sunday it aims to slash fiscal 2016 expenses by as much as $2.5 billion, through layoffs and a wide array of cost controls, as an essential part of its ongoing turnaround efforts.

"We are leaving no stone unturned and looking at all areas," company spokesman Dave Tovar said in an interview. He declined to predict how many employees would be laid off, saying it was too early in the budgeting process.

SEE ALSO: Chipotle shuts Seattle, Portland stores after E. coli outbreak

The estimated cost savings for Sprint, which has 31,000 employees, would be equivalent to about 10 percent of its current annual operating costs of $26 billion.

he ratio of the company's capital expenditures to its sales is more than 20 percent, which Tovar said is higher than for other wireless carriers. "We are trying to get more in line with the industry average," he said.

He said Sprint on Tuesday will provide more details about the job cuts and the company's plans to bolster the quality, speed and capacity of its wireless network, when it reports fiscal second-quarter results.

Savings are also expected to come from cutting severance for laid off employees and temporarily eliminating raises.

In its first quarter ended June 30, the company posted a $20 million loss as revenue fell 8.7 percent to $8.03 billion, missing analysts' estimates of $8.43 billion. But majority owner Softbank Corp (9984.T) eased investor concerns by saying it has no plans to sell its stake in Sprint.

Sprint has been burning through cash because of monthly leasing plans requiring wireless carriers to pay vendors for devices up front.

More on AOL.com:
James Bond breaks records with $80M opening for 'Spectre' overseas
Caddie opens up on Tiger Woods' affairs in tell-all book
Questions and answers about huge US desalination plant