Qwest plans to eliminate 1,200 jobs

Qwest Communications International Inc., the third-largest local phone company in the United States, plans to cut 1,200 jobs and said sales and earnings this year will be at the low end of its forecasts.

Qwest spokesman Mark Molzen told the Deseret News on Wednesday that he did not know how many Utah employees would be affected by the job cuts but said they would occur by year-end. The company has about 2,500 employees in Utah.

"I can say that the work-force reductions are really across the organization, impacting occupational as well as management employees," he said.

Third-quarter net income fell to $151 million, or 9 cents a share, from $2.07 billion, or $1.08, a year earlier, when a tax-related gain lifted results. The firings will trim the work force more than 3 percent, Qwest said Wednesday in a statement.

Sales of high-speed Internet connections trailed estimates, and more consumers switched to cable companies like Comcast Corp. that offer digital calling plans. Denver-based Qwest had 11.9 million active phone lines, a decline of 8.9 percent from a year earlier. If the economy worsens, the pace of defections may pick up further, said Donna Jaegers at D.A. Davidson & Co.

Sales dropped 1.6 percent to $3.38 billion in the quarter. Analysts' estimates averaged $3.33 billion. Excluding $63 million for severance payments and a $33 million gain from a restructured lease, profit was about 10 cents a share, in line with the average estimate of analysts surveyed by Bloomberg.

Qwest dropped 20 cents, or 7.7 percent, to close Wednesday at $2.40. The shares have fallen 66 percent this year.

---

Contributing: Brice Wallace, Deseret News.