Verizon starts cutting more than 13,000 jobs

(Sharecast News) - Verizon started cutting more than 13,000 jobs in what new chief executive Dan Schulman described as the company's largest-ever restructuring on Thursday, as the US telecommunications giant looked to reduce costs and refocus on customer growth. Employees in the United States were notified on Thursday morning, the Wall Street Journal reported, while staff overseas may learn of their status in the coming weeks.

Schulman said the overhaul was needed to simplify operations and free up investment for improving customer experience after a period of weaker subscriber trends.

Verizon lost a net 7,000 consumer postpaid phone connections in the latest quarter, missing analysts' expectations for a gain, while rivals AT&T and T-Mobile continued to expand their subscriber bases.

In an internal memo, Schulman said Verizon's cost structure "limits our ability to invest significantly in our customer value proposition" and that the company "must reorient our entire company around delivering for and delighting our customers."

The cuts would reduce labour expenses for nonunion US staff by about 20% and would be accompanied by a significant reduction in outsourced and external labour.

Verizon had about 100,000 employees earlier this year, the vast majority in the US.

The decision followed the board's move last month to replace former chief executive Hans Vestberg, whose network-led strategy had fallen out of favour, with Schulman, previously a PayPal chief and Verizon's lead independent director.

Alongside the layoffs, Verizon is creating a $20m reskilling and career-transition fund focused on digital training and job placement, intended to help departing employees prepare for roles in what Schulman called the "age of AI."

He had signalled deeper organisational changes to come, telling investors that Verizon had "fallen short of our potential" and that its recent reliance on price increases without subscriber growth "is not a sustainable strategy."

At 1045 ET (1545 GMT), shares in Verizon Communications were down 0.63% in New York at $40.93.

Reporting by Josh White for Sharecast.com.