BROOMFIELD, Colo.--Communications network operator Level 3 Communications plans to cut 1,400 jobs, or 23.7 percent of its work force, in a bid to cut costs and said it expects to lose more this year than had been anticipated.
In a news release Monday, Level 3 said the cuts were part of measures aimed to cut $2.3 billion in costs through 2003. Chief Operating Officer James Q. Crowe said it was responding to the slowing economy.
The company expects its net loss in 2001 to be approximately $7.50 per share, up from previous estimates of $7.25 a share.
Analysts surveyed by Thomson Financial/First Call had expected Level 3 would lose $7.27 a share for the year.
In morning trading on the Nasdaq Stock Market, Level 3 shares were down $1.21 a share, or 15.9 percent, to $6.41.
The company said most of the cuts would come in the communications sector, where it has 5,200 of its 5,900 employees. About 820 jobs will be cut at Level 3's North American offices. Another 550 will be cut from European operations and 30 from Asia.
Level 3 has built a $10 billion network of fiber-optic communications lines connecting cities across the United with cities in Europe and Asia.
The company has posted losses as it built its fiber-optic network, but its earnings have beaten Wall Street expectations for the past few quarters.
Level 3 has also changed its business strategy to focus on selling to established companies rather than newer ones. Level 3 said it believes about 20 percent of its recurring revenue base is at risk over the rest of the year because some customers may be unable to pay their bills.