Verizon to Layoff Over 13,000 Employees in Restructuring Effort

Verizon will remove more than 13,000 jobs from its workforce as part of a cost-cutting plan. Most of the affected employees are expected to leave next month, according to the news reports. The company estimates a severance expense of $1.6 billion to $1.8 billion in the fourth quarter. Verizon shares fell by about 1% after the announcement. 

Store Conversions and Cost Reductions 

The company will change the way some of its retail business operates. 179 corporate-owned stores will be turned into franchise locations, and one store will shut down permanently. Verizon also plans to cut spending linked to external labour and outsourced work as part of a wider effort to reduce operating costs across the organisation. 

Message from the Incoming CEO 

As per the news reports, Dan Schulman, who took over as CEO in October and has been on Verizon’s board since 2018, told employees that the current cost structure is affecting investment in customer-related areas. His internal note said that operations need to be simplified to remove delays and reduce internal complications.  

Schulman also announced a $20 million fund to help laid-off workers with career training and skill development. Verizon stated that the cuts are not caused by the use of artificial intelligence. 

Competitive Pressure and Slowing Growth 

The layoffs come at a time when the company is struggling to attract new customers at the same pace as its competitors. In the third quarter, Verizon reported 44,000 new post-paid wireless subscribers, trailing behind AT&T, while T-Mobile gained more than 1 million new subscribers.  

At the end of 2024, Verizon had about 100,000 employees in the U.S., including 70,000 non-union staff, after already removing nearly 20,000 roles over three years. 

Recent Spending and Network Investments 

Verizon has also been managing large spending commitments made in recent years. These include $52 billion for 5G spectrum rights in 2021, a $20 billion purchase of Frontier Communications, and $6 billion to acquire TracFone Wireless. 

Read More: Urja Global Share Price Jumps 10% After JV With Solarmint to Make Urja-Branded Solar Panels! 

Conclusion 

The job cuts and operational changes show Verizon adjusting its structure and costs during a period of slower subscriber growth and rising competition in the wireless market. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.  

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.