Crown Castle slashes 20% workforce, forecasts dour annual site rental revenue

Feb 4 (Reuters) - Wireless tower operator Crown Castle CCI.N said on Wednesday it would reduce its tower and corporate workforce by around 20% and also forecast annual site rental revenue below Wall Street expectations, sending its shares down over 7% in extended trading.

The headcount reduction and downbeat forecast suggests the company's transition into a pure-play tower operator is proving difficult as it sees lower spending from large wireless carriers.

The company had decided to sell its fiber assets last year to two entities for $8.5 billion after activist investor Elliott Investment Management pushed the firm to improve financials.

After the sale of its fiber business, the company expects to buy back around $1 billion worth of shares and repay around $7 billion of debt.

Crown Castle said the workforce cuts and other cost reductions will result in around $65 million in annualized operating cost savings.

"We are investing in our systems, streamlining our processes to enhance operational flexibility, and continuing to drive productivity and efficiency across the business," said Chris Hillabrant, Crown Castle's chief executive officer.

The firm's annual forecast does not include any contributions from DISH Wireless after Crown Castle terminated their contract due to payment defaults.

Crown Castle derives a majority of its revenue from leasing out tower infrastructure to U.S. wireless carriers such as AT&T T.N, T-Mobile TMUS.O and Verizon VZ.N on a long-term basis.

It forecast fiscal 2026 site rental revenue to be between $3.83 billion and $3.87 billion, below analysts expectations of $4.13 billion according to data compiled by LSEG.

The company expects annual adjusted funds from operations of between $4.38 and $4.49 per share, compared with estimates of $4.93.

Fourth-quarter site rental revenue was $1.02 billion, compared with estimates of $1.01 billion.