BT slashes workforce to 90,000 as profit jumps

BT has reduced its employee count by nearly 8,000 in the last six months, a move that coincides with a sharp increase in profitability. The company announced on Thursday that its workforce had dropped to 90,000, down from approximately 130,000 including contractors two years prior.

The reduction of 7,731 staff members excludes those in the international business, which is being spun off into a joint venture with Verizon. Most of the job losses occurred within the Openreach division. As the construction of the fiber network slows, BT has focused on cutting billions of pounds in costs to meet a 2030 target.

These cost reductions helped drive pre-tax profit up by 12% year on year to £1.1bn in the six-month period ending in September. The positive results were reflected immediately in the stock market. BT shares, listed in London, rose as much as 6% in early trading on Thursday. The stock touched a five-year high, making it one of the best performers in the FTSE 100.

Allison Kirkby, who has served as chief executive since February 2024, has led the cost-cutting initiative. She previously announced that BT would raise its savings target from £3bn by 2029 to £3.7bn by 2030. The group now expects its headcount to reach between 75,000 and 80,000 by the end of the decade. This figure is toward the lower end of the 75,000 to 90,000 range estimated in 2023, a period when the company noted that artificial intelligence could eliminate the equivalent of about 10,000 roles.

Kirkby’s compensation more than doubled last year to £5.6m, marking the largest pay award for a BT executive in over a decade. Shares in the company have risen by more than 70% since she assumed her role. She has also overseen the £400m acquisition of smaller rival TalkTalk, a deal still under regulatory review. TalkTalk, based in Salford, employs about 900 people and serves 2.5m households, including public sector clients like hospitals and schools.

Virgin Media O2, which had also considered acquiring TalkTalk, described the BT deal as a "stitch-up" that would strengthen BT's dominant position. BT currently holds a market share of about 30%, according to Enders Analysis. Openreach, the network owned by BT, serves as TalkTalk's largest supplier. BT reported record demand for its full-fiber network, which has reached 24.1m homes and is targeted to cover 25m by year's end. Virgin Media O2 announced plans for its own £800m savings drive earlier this week.