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Sprint CEO says T-Mobile merger may help Kansas HQ grow again after years of cuts

A merger with T-Mobile promises a return to growth at Sprint’s Overland Park headquarters but has a “shadow impact” on current customer counts, Sprint CEO Michel Combes said Thursday.

After years of cutbacks at the headquarters campus, Sprint has “an opportunity to grow it again” through the merger, Combes said.

He said plans to open a customer care center there — if the $26 billion merger is approved by federal officials — would boost employment beyond the roughly 6,000 on the current payroll.

“It’s an additional 1,000 employees, which is expected, so it’s not a substitution,” Combes said.

He made the comments after Sprint reported a decline in its total customer count and a financial loss in the last three months of 2018.

Sprint and T-Mobile jointly announced plans Wednesday to open five new customer care centers, including in Overland Park, and expand two existing T-Mobile centers after merger.

Sprint has had a customer care center at its headquarters off and on over the years. Currently, there is only a phone-based sales operation at the campus.

The companies have pitched the merger to regulators and others in part by saying they would have more employees together than their combined totals alone. Other job growth across both companies after the merger will come from new stores and network improvements, the companies have said.

Others have said the merger would cost thousands of jobs and could depress wages throughout the industry.

Adding jobs in Overland Park would reverse course for a headquarters that had seen thousands of jobs disappear through layoffs and cost-cutting measures.

Most took place under Combes’ predecessor, Marcelo Claure. Combes said they were necessary “in a difficult context” to put Sprint in a more sustainable position and ready for the merger, which the companies expect will receive federal approval and be completed in the first half of this year.

The wait, however, may be crimping Sprint’s customer counts.

“It’s obvious that the deal has a kind of a shadow impact,” Combes said. He said that as consumers repeatedly see and hear reports about the merger, “most likely it will reduce a bit the appetite to come to Sprint stores.”

How much it hurts, Combes said, is impossible to tell. He cited other pressures on Sprint’s customer counts, including intense competition from Verizon.

Sprint also reported Thursday a drop in total connections to its wireless network and a net loss of $141 million as 2018 came to a close.

The company said it added 48,000 new customers but also eliminated from its count 100,000 connections that had been generating no revenue for the company.

It left Sprint, the nation’s fourth largest wireless carrier, with 54.495 million wireless connections.

Financially, Sprint said its revenues in the last three months of 2018 reached $8.6 billion, compared with $8.24 billion a year earlier. The report covers the third quarter of Sprint’s fiscal year, which will end March 31.

Combes said in the announcement that the results reflect Sprint’s efforts to balance its growth and profitability ahead of the merger.

“We delivered solid financials, increased network investments as we prepare for our mobile 5G launch, and continued the digital transformation of the company,” he said in the announcement.

During the quarter, Sprint added 309,000 post-paid customers, or those who pass a credit check to qualify for service on a monthly subscription. Its total of prepaid customers and customers connected by wholesalers declined by 261,000.

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Mark Davis writes about business for The Kansas City Star with attention to Sprint, investing, the economy and scams. He has been a winner and finalist in national competitions held by the Society for Advancing Business Editing and Writing.
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