Expectations were high for Michael Armstrong's first presentation to analysts as CEO of AT&T. In fact, the meeting was so eagerly anticipated that Armstrong opened by warning: "For those of you expecting Moses and the Ten Commandments, you might be a little disappointed."

Still, Armstrong handed down an ambitious plan. As part of an effort to reduce overhead to 22% of sales from 29% in two years, AT&T will cut 15,000 to 18,000 of 128,000 jobs. Some 10,000 to 11,000 managers should take early-retirement offers. An additional 5,000 to 7,000 nonmanagement positions will be cut through attrition and layoffs.

Armstrong also outlined expansion plans. AT&T will make $8 billion in capital investments in 1998, much of it to modernize its network so it can carry data as easily as voice traffic. Some $1 billion will be invested to capture some of the $20 billion local business market. Armstrong also wants to expand AT&T's international, wireless, and Internet businesses. No, it's not the Ten Commandments. Only the rules for AT&T's hoped-for rebound.

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