AT&T has been conducting another round of layoffs as part of its massive cost-cutting plan. However, one area that’s not being cut is CEO Randall Stephenson’s retirement. He announced his retirement a couple weeks ago, and now we find out that he will receive $274,000 per month for the rest of his life after leaving the company.
AT&T CEO retires with $274,000 per month
Citing company filings, MarketWatch reports that Stephenson will retire from AT&T with a $64 million pension. Industry data reveals that it will provide $274,000 per month in guaranteed income for the 59-year-old until his death.
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In 2019, he received $1.2 million in matched funds from the company to his "deferral plans." Additionally, he owns at least $20 million in stock and options in AT&T. Over the last three years, his average compensation was $30 million per year.
Layoffs at AT&T
While Stephenson is taking a massive windfall in retirement, AT&T is conducting layoffs as part of at $10 billion cost-cutting measure. What's worse is that AT&T's layoffs come after company executives promised to add thousands of jobs in the wake of the Trump administration's tax cuts in 2018.
President and Chief Operating Officer John Stankey, who will be taking over the reins of the company after Stephenson's retirement, revealed their cost-cutting initiatives in March at a Morgan Stanley conference. A transcript posted by the company indicates that they are looking at 10 initiatives executives believe "can generate double digits of billions over a three-year planning cycle."
One of those initiatives will include layoffs, although AT&T doesn't call them that. Instead, the company used the term "headcount rationalization." Stankey also said that while the company has already been cutting jobs for a while, it will do "additional work" in that area.
Paying off debt
AT&T cut over $1.6 billion off its spending last year and expects to cut over $3 billion this year. Last year the company laid off more than 20,000 employees after pledging to add jobs using the money saved on taxes after the corporate tax cut.
The company has been trying to pay down some of its debt, much of which was incurred when it bought Time Warner. The company had $163.1 billion in debt at the end of last year. The company said last year that after it reached its debt-reduction target for the year, it would use the money that was left over to buy back shares.
AT&T suspended its share repurchase plan earlier this year in response to the pandemic, but it continues to pay dividends while conducting layoffs and channeling millions to its retiring CEO.