The company will maintain a research and sales operation in Chelmsford where it employs 100 people, but it will also be closing an office in Germantown, Maryland and parts of its Illinois operations. As part of the recent cutbacks, management salaries will also be reduced, pay hikes will be eliminated and discretionary spending will be cut. These latest cutbacks and closings come on the heels of additional cutbacks in the first quarter of the year when Tellabs laid off 450 temporary and contract jobs and eliminated 1,100 vacant jobs.

In a released statement Tellabs stated that it will take $262 million out of its second quarter earnings, which is significantly higher than the company had anticipated. It had originally stated that the costs of the cutbacks would be between $150 million and $225 million. Tellabs did not return calls by presstime, but the company is being hit by the same downturn as its competitors in the communications equipment industry as client demand decreases.