Sprint’s Credit Is Junk, Moody’s Tells Investors

Sprint (NYSE: S) Nextel’s credit rating has been downgraded to “junk” status by Moody’s Investors Service, less than a week after Motorola (NYSE: MOT) got the same damaging mark from Standard & Poor’s, Triangle Business Journal reports. Following a seven-month long review of Sprint, Moody’s determined the carrier’s subscriber churn will continue to hit the company hard through the middle of next year. Earlier this week, the company’s CFO Bob Brust said the carrier is considering Draconian-like cuts and a spokesperson said all options are on the table. Over the past month the carrier has offered voluntary buyouts to most of it 57,000 employees who don’t interact directly with customers, but not enough employees are said to be taking the company up on the offer. It also floated a plan to outsource most of its IT and network operations staff. The carrier has floundered since acquiring Nextel Communications in 2005.

Comments have been disabled for this post