Virgin Media O2 to cut thousands of jobs in £800m cost drive

Summarised from 5 outlets · 7 reports · Updated 3 Nov, 08:39 · Archive

Virgin Media O2 is cutting thousands of jobs to save £800m annually by 2029 and tackle its £22bn debt.

Virgin Media O2 has confirmed it will cut thousands of jobs from its 16,000-strong UK workforce as part of a major cost-cutting drive. The company aims to save £800m annually by 2029, with £400m delivered by 2027. It has not specified the exact number of redundancies, though reports suggest it could be as many as 4,000 to 4,800 staff, representing up to 30 per cent of its workforce.

The bulk of the savings – approximately £300m – will come directly from job cuts that will reduce the company's labour costs by around 30 per cent. Most of those affected will be in non-customer-facing roles, with the overhaul expected to focus on head office, IT and support functions. Senior leadership positions are already being cut, and the company plans to review its use of contractors and suppliers as part of the broader restructuring.

Virgin Media O2 is also increasing its use of artificial intelligence in areas including customer service, network planning and fault management. The company has halted investment in upgrading its network to full fibre beyond existing commitments, which is currently 50 per cent complete.

Chief executive Lutz Schüler said the action was necessary given market conditions, regulatory challenges in fibre and technological changes sweeping the sector. 'Standing still and doing what we've always done is not an option and while many of these decisions are tough, they are necessary for our future success and growth,' he said. He added a commitment to treat departing staff fairly and with respect.

The cuts come as Virgin Media O2 battles a £22bn debt pile, intense competition from smaller challengers and larger rivals like BT, which recently agreed to buy TalkTalk. The company is jointly owned by Liberty Global and Telefónica.

City AM reports that an analyst at Bloomberg Intelligence estimated the proposed redundancies could generate £200m in annual gross personnel savings by 2028, with further reductions in contractor spending potentially increasing that figure. However, the analyst warned that even substantial job cuts combined with scaled-back investment in fibre infrastructure would leave the company's debt levels stubbornly high, with net leverage potentially remaining close to 5.5 times earnings in 2028, well above the company's target range of four to five times.

The company is expected to outline fuller details of its strategic plan in the coming months.

How it is being reported

• Virgin Media O2 cutting thousands of jobs in cost savings overhaulThe bulk of the savings – about £300 million – will come from job cuts among its 16,000-strong UK workforce.Independent Business · 3 Nov, 08:47
• Virgin Media O2 to cut thousands of jobs as it plans £800m cost savingsUp to 25% of 16,000 workforce could go as telecoms group says it will increase use of AI in areas including customer service Business live – latest updates Virgin Media O2 is to cut thousands of jobs in an £800m cost-cutting drive as the telecommunications company aims to tackle its £22bn debt pile. VMO2, which is jointly owned by Liberty Global and Telefónica, said £300m of the savings target will come from job cuts that will reduce the company’s employee wage bill by 30% over the next two years. Continue reading...Guardian Business · 3 Nov, 08:21
• Virgin Media O2 to cut thousands of jobs in huge cost savings overhaulThe company said the bulk of the cost savings – about £300 million – will come from job cuts in the UKThe Independent · 3 Nov, 08:08
• Virgin Media O2 cutting thousands of jobs in cost savings overhaulThe bulk of the savings – about £300 million – will come from job cuts among its 16,000-strong UK workforce.Independent Business · 3 Nov, 08:01
• Virgin Media O2 confirms plans to axe thousands of jobs in cost-cutting driveVirgin Media O2 has confirmed it will axe thousands of jobs among its 16,000-strong workforce under plans to cut costs.This is Money · 3 Nov, 08:00
• Virgin Media O2 job cuts could save £200m but fail to ease debt crisisVirgin Media O2’s plans to axe up to 4,000 jobs could save the telecoms giant around £200m a year, but may do little to ease its mounting debt burden. The broadband provider is preparing to cut as much as a quarter of its 16,000-strong workforce as it battles fierce competition, falling revenues and concerns over [...]City AM · 2 Nov, 12:28
• Virgin Media O2 reportedly set to cut thousands of jobs in a bid to save costsVirgin Media O2 could be set to lay off 4,000 of its 16,000 workers amid plans to tackle company debt.TechRadar · 2 Nov, 09:54

In this story: Virgin Media O2 · Liberty Global · Telefónica · Lutz Schüler · BT · TalkTalk · UK

This summary was written by AI from the headlines and standfirsts above, and states as fact only what at least two outlets report. How we use AI · Report a problem · Corrections log