Feeds

MCI to axe 7,500 jobs

Blames 'adverse industry environment'

  • alert
  • submit to reddit

The Power of One Infographic

MCI - formerly known as WorldCom - is to axe 7,500 jobs as it struggles to make its way in an "adverse industry environment". This latest round of job losses comes just six weeks after the global communications outfit revealed plans to erase 4,000 jobs from its operation.

News of the job losses came as the company reported its first quarter (Q1) results - the first since it emerged from Chapter 11 bankruptcy protection last month after spending the last two years clearing up the mess left behind from a damaging accounting scandal.

MCI's revenue during the first three months of the year fell to $6.3bn (£3.6bn) compared to $7.2bn (£4bn) a year earlier. The company also ran up an operating loss of $205m (£116m) for the first quarter, compared to an operating profit of $634m (£359m) during the same period last year. It made a net loss of $388m (£220m) in Q1 '04, compared to net income of $52m (£29m) in 2003.

MCI blamed this loss on declining revenue, "caused in part by industry pricing", which reflected the "adverse industry environment, as excess capacity and new technology adoption continue to pressure pricing". The job cuts earmarked for the next three months are just one way MCI reckons it can cut costs and return to profitability in the second half of the year.

Said boss Michael Capellas: "Although we made significant strides in restructuring the company during the past year, overall industry conditions and an unfavorable regulatory environment affected our first quarter results. In response we are accelerating our cost reduction program, ramping new product introductions and optimizing our network wherever possible." ®

Related stories

MCI breaks free from Chapter 11
MCI to axe 4,000 US jobs
WorldCom gets sums wrong by $74bn
AT&T threatens MCI with price war

The Essential Guide to IT Transformation

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
Amazon Reveals One Weird Trick: A Loss On Almost $20bn In Sales
Investors really hate it: Share price plunge as growth SLOWS in key AWS division
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Chips are down at Broadcom: Thousands of workers laid off
Cellphone baseband device biz shuttered
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.