(Reuters) – T-Mobile US said on Thursday it would reduce its workforce by about 7% by cutting 5,000 jobs in the United States as the wireless carrier grapples with rising costs related to adding more subscribers in a competitive market.
The carrier has been taking the lion’s share of subscribers looking for cheaper plans in the last three quarters through discounted bundles, but that has taken a toll on T-Mobile.
“What it takes to attract and retain customers is materially more expensive than it was just a few quarters ago,” CEO Mike Sievert said in an email to employees.
The jobs cuts over the next five weeks will target corporate and back-office roles, and some technology jobs, Sievert said, adding that retail and consumer care divisions will not be impacted.
The carrier expects to incur a pre-tax charge of about $450 million in the third quarter.
T-Mobile had said in July that it expects wireless subscriber net additions between 5.6 million and 5.9 million.
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Sievert said some areas of the business will implement more centralized models to improve efficiency and save costs.
Rival AT&T had also expanded its cost-cutting plan to $2 billion in July.
(Reporting by Chavi Mehta in Bengaluru; Editing by Anil D’Silva and Arun Koyyur)
