AT&T is laying off 3,400 employees and closing more than 250 retail stores, according to Business Insider. The telecom giant and mobile service provider also is seeking to sell its Warner Brothers video game unit, CNBC reports. Investments in strategic growth areas such as AT&T Cybersecurity and 5G networks continue.
The changes come as AT&T prepares to transition its CEO post from Randall Stephenson to John Stankey, effective July 1, 2020. Stankey, currently president and COO, led AT&T's acquisition of DirecTV and Time Warner.
Next up, Stankey is expected to oversee a multi-year strategy that will include "headcount rationalization" and $6 billion in cost savings, he said in April 2020.
Related: Track all technology industry layoffs here.
AT&T Debt Challenges, 5G Opportunities
The layoffs and potential video game asset sale surface as AT&T strives to navigate four major challenges:
- Navigate the coronavirus pandemic and resulting economic fallout.
- Unlock the value of acquired content services, such as HBO.
- Invest for the future, including 5G network build outs.
- Retire debt in order to improve the telecom giant's balance sheet.
The Dallas Morning News notes:
"AT&T has been under pressure to reduce costs and sell assets to help pay down debt, expand 5G wireless networks, raise its shareholder dividend and expand its WarnerMedia entertainment offerings. Those include the streaming platform HBO Max, into which AT&T is plowing billions of dollars on content and marketing."
AT&T Staff Cut Details, Security Investments
On the AT&T staffing front, the following near-term moves are planned, according to business insider.
- AT&T Mobility and Cricket Wireless retail closures will affect 1,300 jobs
- Additional layoffs will involve technical and clerical workers.
- Employees impacted by the layoffs will receive severance and healthcare coverage for up to six months.
Still, AT&T continues to invest for growth within multiple business units. Key examples include AT&T Cybersecurity, a Top 200 MSSP that leverages the AlienVault acquisition of 2018 and works with MSPs.
