August 11, 2014

Sprint’s new CEO house-shops in KC; employees pack Hesse’s sendoff party

Sprint’s campus employees gave departing CEO Dan Hesse a sendoff Friday afternoon and got a letter Monday from the new boss Marcelo Claure. Claure said he spent the weekend house-shopping and will share his vision for Sprint with employees on Thursday.

After a weekend of house shopping in Kansas City, Sprint Corp.’s new chief executive promised employees a “town hall” event this week to catch them up on his plans.

Marcelo Claure, who took over for longtime CEO Dan Hesse on Monday, briefed Sprint employees in a letter, which the Overland Park-based company made available.

Employees had made their farewells to Hesse on Friday during a 90-minute sendoff event. Hesse, who had led the company since late 2007, drew a headquarters campus crowd, posed for snapshots and shared some of his favorite desserts.

“Thank You Dan!” said the banner overhead the Winter Garden building’s spacious atrium.

Claure’s letter said he would hold a company-wide “town hall” on Thursday “to share my thoughts and vision for making Sprint the wireless carrier of choice.”

And the new boss let employees know he is making good on a promise last week that he would be relocating to the Kansas City area.

“I could not be more thrilled and excited. In fact, I spent this past weekend looking at properties in Kansas City and enrolling my children in a local school,” he said.

Claure has been a member of Sprint’s board of directors since Jan. 13 and told employees in his letter that he has been able to work closely with management “to outline the future strategy of the company.”

Sprint has struggled to hang onto subscribers as its rivals, notably T-Mobile, have continued to grow. Sprint and T-Mobile’s customer counts have become close enough — a difference of 4 million at the end of June — that T-Mobile chief executive John Legere has said his company’s total will overtake Sprint’s by the end of this year.

Claure’s appointment to the CEO post was announced last Wednesday along with word that the company was dropping its long effort to merge with T-Mobile.

The shakeup left investors unhappy and knocked 23 percent off the value of Sprint shares. The stock regained 7 cents to close Monday at $5.74.

Analysts widely expect Sprint to cut prices, at least enough to catch up with changes at AT&T and T-Mobile. Hesse had said late last month that the company was testing pricing plans and that the market had moved somewhat away from Sprint’s Framily discount plan terms that had been set in January.

Jennifer Fritzsche, an analyst at Wells Fargo Securities, told clients in a weekend note that she was surprised by the stock’s plunge and had been pummeled by questions about what makes Sprint’s investment outlook attractive.

“While we don’t disagree that Sprint will do something on pricing...,” she wrote, “if it can get the doors swinging the right way (meaning IN the stores), that is what they need to do.”

Claure’s letter to employees offered no details about the company’s plans, though it reiterated his comments that the company would “focus on becoming extremely cost efficient and competing aggressively in the marketplace.”

The letter noted that Sprint faces “challenges and opportunities” and that “some of them are significant.”

Claure recognized Hesse’s efforts and how the longtime CEO had “guided this company through some difficult challenges and positioned it as a leader in sustainability and corporate responsibility.”

Hesse’s sendoff was an informal affair without a speech from the exiting boss or scheduled agenda. He’d offered his company-wide goodbye in a letter last week.

To reach Mark Davis, call 816-234-4372 or send email to Follow him on Facebook and Twitter @mdkcstar.

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