US telco WorldCom has announced that it will shed 3,700 employees, or four per cent of its global workforce, in an attempt to align costs with its projected 2002 revenue guidance given in February.
At that time, the company said it expected to see growth in the mid-single digits.
WorldCom confirmed that the job reductions will come from the WorldCom Group, a unit that provides telecoms and data services to businesses. There will be no cuts at the company's main consumer long-distance unit, the MCI group.
The job losses are less drastic than some earlier reports of a possible 10 per cent reduction in its workforce of 75,000.
The affected employees will receive a severance package determined by length of service, according to a company statement.
Lehman Brothers analyst Blake Bath lowered his revenue growth forecasts for WorldCom based on tougher than anticipated demand and pricing.
"WorldCom has been shrinking and we believe will continue to do so for the next several years," he wrote in a research note.
The second largest long-distance provider, WorldCom has recently come under investigation by the Securities and Exchange Commission for its accounting practices.
The probe also focuses on disputed customer bills and sales commissions, loans to officers or directors and customer service contracts.
WorldCom had a cash pile of over $2.2bn (£1.5bn) as of 31 March, up from $1.4bn (£975m) on 31 December, and $30bn (£20.9bn) in debt.
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