BT Group PLC (LSE:BT.A) is to cut between 40,000 and 55,000 jobs - up to 42% of its workforce - by the end of the decade as it looks to trim costs and become a “leaner business with a brighter future”.
The telco said the reductions, which include both employees and third-party contractors, would be completed between 2028 and 2030.
Philip Jansen, chief executive, said: “By continuing to build and connect like fury, digitise the way we work and simplify our structure, by the end of the 2020s BT Group will rely on a much smaller workforce and a significantly reduced cost base.”
On 'digitising' the company, he told reporters that "whenever you get new technologies you can get big changes" and that AI tools such as ChatGPT "gives us confidence we can go even further".
Profits drop
The news came as the company unveiled marginally lower revenue and a drop in profitiability with growth in Openreach more than offset by declines elsewhere.
In the year to 31 March 2023, BT reported revenue of £20.68bn, down 1% from £20.85bn a year prior and a 12% drop in reported pre-tax profit to £1.73bn from £1.96bn due to increased depreciation from network build.
Adjusted EBITDA of £7.9bn was up 5% due to growth in Openreach and Consumer, offset by a decline in Enterprise.
A final dividend of 5.39p was paid, bringing the full-year dividend to 7.70p, flat year on year.
The firm said customer demand in Openreach for Fiber to the Premises (FTTP) was extremely strong with orders in the financial year up 70% on the previous year, with record net adds of 395,000 in the fourth quarter, taking the customer base to around 3.1mln.
Growth guidance
For the new financial year, BT forecast revenue and EBITDA growth on a pro forma basis, a capital expenditure excluding spectrum of £5.0bn-£5.1bn and normalised free cash flow of £1.0bn-£1.2bn.
Jansen said: “We have delivered our outlook for FY23: this year we've grown both pro forma revenue and EBITDA for the first time in six years while navigating an extraordinary macro-economic backdrop.”
“Over the last four years, we have stuck firmly to our strategy and it's working.”
Shares fell 3.6% to 142.8p.
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