In a drastic move to reshape its future, American telecoms behemoth Verizon has announced it is cutting its global workforce by a staggering 13,000 employees. The news was delivered to staff in a sobering letter from Chief Executive Officer Dan Schulman on Thursday.
A Devastating Blow to the Workforce
The decision means that more than 13,000 workers, representing approximately 13 percent of the company's total workforce, will lose their jobs. This marks the largest round of layoffs in the company's history. According to its most recent annual report, Verizon employed 99,600 people at the end of 2024, providing stark context for the scale of these cuts.
In his internal memo, Schulman detailed that the company would begin the reductions across the organisation, coupled with a significant decrease in spending on outsourced and other external labour. He justified the painful decision by stating that 'our current cost structure limits our ability to invest significantly in our customer value proposition.'
Mounting Pressure and Customer Exodus
The mass layoffs come as Verizon faces intense pressure from rivals and a worrying exodus of customers. As America's largest wireless carrier by subscribers, it has been haemorrhaging lucrative postpaid phone customers for three consecutive quarters.
The competition from T-Mobile and AT&T, which have been running aggressive promotional campaigns, has taken a severe toll. This backfired for Verizon after it decided to pull back on its own holiday discounts while its competitors continued to slash prices.
The consequences were severe. Verizon acknowledged in April that it lost a shocking 289,000 monthly wireless customers in the first quarter alone. This figure was more than double the losses from the same period the previous year and far worse than financial analysts on Wall Street had anticipated. The company told investors this customer flight 'reflects the impact of recent pricing actions,' following its decision to raise rates and scale back discounts.
A New CEO's Cost-Cutting Vision
This major shake-up arrives just weeks after the appointment of Dan Schulman, the former chief of PayPal and Virgin Mobile USA, as Verizon's new CEO. Schulman has vowed to overhaul the business, stem the steady decline in wireless subscribers, and implement widespread cost reductions.
Speaking last month about the company's third-quarter results, Schulman set the tone for his leadership, stating, 'We have a tremendous amount of opportunity to be more efficient, to be scrappier.' He left little room for doubt about his intentions, adding unequivocally, 'Cost reductions will be a way of life for us here.' This latest announcement confirms that this new, harsh philosophy is now being put into practice, with thousands of employees paying the price for the company's strategic evolution.
