BT reduces workforce by 7,731 as fiber expansion slows

BT has removed 7,731 positions from its payroll since March, reducing its core workforce to 90,000 employees. This reduction excludes staff within the international division, which is being separated into a joint venture with Verizon. The company noted that its total headcount, including contractors, stood at approximately 130,000 just two years ago.

The majority of these departures occurred within the Openreach division. This unit manages the physical broadband network, and its staffing levels have decreased as the pace of fiber optic construction has slowed. BT is also implementing a strategy to reduce operational costs by billions of pounds before 2030. These measures contributed to a 12% year-on-year increase in pre-tax profit, reaching £1.1bn for the six months ending in September.

Investors responded positively to the earnings report. BT shares, which are traded on the London Stock Exchange, rose by as much as 6% during early trading on Thursday. This gain pushed the stock to a five-year high, placing it among the top performers in the FTSE 100 index.

Allison Kirkby has led the cost-reduction efforts since becoming chief executive in February 2024. She adjusted the company's savings target upward this year, aiming to cut £3.7bn by 2030 instead of the previous goal of £3bn by 2029. BT expects its total headcount to settle between 75,000 and 80,000 by the end of the decade. This figure is at the lower end of the 75,000 to 90,000 range projected in 2023, a period when the company estimated artificial intelligence could eliminate the equivalent of 10,000 roles.

Kirkby's compensation package more than doubled last year to £5.6m, marking the largest pay award for a BT boss in over a decade. Her tenure has coincided with a rise of more than 70% in the company's share price. She is also overseeing the £400m acquisition of rival TalkTalk, a deal still under regulatory review that preserves service for 2.5m households and public sector clients. Virgin Media O2, which previously bid for TalkTalk, criticized the transaction as a stitch-up that would strengthen BT's market dominance.

BT currently holds an estimated 30% of the UK broadband market, according to Enders Analysis. The company reported record demand for its Openreach full-fiber network, which has reached 24.1m homes. BT is targeting 25m connected households by the end of the year. Rival Virgin Media O2 announced plans earlier this week to cut thousands of jobs as part of its own £800m savings drive.