After one year of the infamous 4-year $10B saving announcement, VZ is no way close to that number. The biggest capex expense is salary, so assuming they want to save at least $3B annually next 3 year (after one time package payout）and each employee’s total annual comp including benefits is abt $150K, that means they need to let go about 20K employees thru VSP or RIF. They give the offers to 44K employees, if only 10K sign up, for sure there will be RIF right after Nov. The whole scheme is nothing but Excel spreadsheet
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https://www.bizjournals.com/dallas/news/2017/07/13/verizon-unveils-plans-for-new-hidden-ridge.html
Just wanted to say, that real estate development on the 160 acres outside of Hidden Ridge, is not for Verizon. The new corporate office is for Pioneer Natural Resources. The rest of the space is for retail, apartments, new rail station, etc so Las Colinas has a location that can attract folks like other areas in DFW; Cityline, Plano Legacy, Legacy West.
Salary and benefits are opex like the others have stated. If 44k employees don’t take the package, the residual headcount will be Riffed at a time and place that best suits Vz. Expect severance to be reduced (below the standard 35wk max) following the 44k buyout. Then expect your job to either be eliminated and contracted out or relocated to VZ’s shiny new HQ campus in Irving Tx.
https://www.bizjournals.com/dallas/news/2017/07/13/verizon-unveils-plans-for-new-hidden-ridge.html
NetOps will be gutted, Engineering will be forced to relo to Irving or find another job (similar to the Sprint and TeMo centralized models). All of the regional network spaces will go dark and be sold off if owned(that revenue offsets the $10B). The wireless vehicle fleet numbers will be slashed (fleet is a HUGE expense). Call centers will be eventually go dark, reps will all be home base workers, eliminating people space is another huge opex reduction. If the current HBW experiment fails to produce they will bite the bullet and contract CS like they did with IT. Contracting out customer facing positions will give Vz some perception issues initially but the opex savings will be again be huge. Expect headcount to be down >60k inside of 36 months. Vz ran fat for a lot of years while the other carriers were going through this, now they’re playing catch-up.
@1szw, I disagree with your last sentence. Craft will continue to care for the customer, as we always have.
skb - I'm an accountant. Salaries are not capex.
@piu --- I recall some years ago in the merged Contel/GTE company, the company offered a package to folks, pretty much one of these across the board packages. The company thought that maybe 200 people would take the package but what happened is a tad over 2000 people took the package. All of them off the books on the same date.
We came to work on a Monday morning with a very crippled company. We got by but only because at the time we cared enough about the customer to make it all work.
I seriously doubt that after this buyout that anyone left will give a care about much of anything.
jak Ask your cfo, in house employees saladry is capex, professional service or contractors are cat as opex, check your fact,
Salaries are not CapEx, they are OpEx. The rest of your post, I didn't read because if you don't know the difference between the two; then what do you actually know?
One has wonder how bad a shape this company is in, After receiving the corporate tax breaks and all the layoffs in the past two years it comes out Billions of dollars last years and this years and in the future. Waiting for some bad financial new to come out, besides the large debt load.
CALLED IT!!!! Verizon needs to fire the Executives because if they keep up at this pace, there wont be anyone left to do the work.