Virgin Media O2 plans thousands of job cuts in sweeping shake-up, Sky News reports
Sky News reports Virgin Media O2 could cut up to 4,000 of its 16,000 jobs as it tackles a £22 billion debt pile, with a cost-reduction target expected alongside Tuesday's third-quarter results.
Virgin Media O2 is preparing to cut thousands of jobs in a sweeping shake-up of Britain's second-largest broadband and mobile operator, Sky News reported on Saturday, citing people close to the company. The report, carried by Reuters, said as many as 4,000 of the company's roughly 16,000 employees could be affected, although the precise number of redundancies has yet to be finalised.
The job cuts are expected to fall mainly on roles that do not deal directly with customers, according to the report, while a number of senior leadership changes are already under way at the company led by chief executive Lutz Schuler. Virgin Media O2 did not immediately comment on the reported plans when approached by Reuters.
The company is also expected to review its use of contractors and suppliers as part of the cost-cutting drive, the report said. A formal cost-reduction target is expected to be confirmed in financial rather than headcount terms alongside the company's third-quarter results on Tuesday, when the final shape of the cuts may become clearer.
Trade union officials at the Communication Workers Union (CWU) and Prospect are understood to have been briefed on parts of the transformation plans, according to Sky News. The unions represent significant numbers of telecoms workers in Britain, and any large-scale redundancy programme would normally be subject to formal consultation with them before individual roles are confirmed.
The reported cuts come against the backdrop of mounting investor concern about Virgin Media O2's debt pile, which stands at about £22 billion. The Financial Times reported in July that the company's owners were weighing options to reduce that debt, and in September reported that shareholders were seeking cost reductions of about £600 million.
Virgin Media O2 is jointly owned by Liberty Global and Spain's Telefónica, and was formed in 2021 from the merger of broadband provider Virgin Media and mobile network O2. The company has already shed jobs in the years since the merger, including around 2,000 roles in 2023, as it sought to integrate the two businesses and remove duplicated functions.
Investor anxiety about the debt burden intensified during the summer, when the price of the company's bonds fell sharply. Lenders and bondholders have been watching for signs that the owners will act to bring borrowing down, whether through lower spending, reduced dividends, or a leaner operating cost base.
If confirmed, the job losses at Virgin Media O2 would add to a wave of redundancies across Britain's telecoms sector. BT Group and Vodafone Three have both announced significant layoffs in recent years as operators try to become more efficient in the face of rising costs, heavy network investment demands, and sluggish revenue growth.
The timing matters for customers as well as staff. The company is in the middle of a major network upgrade programme, and any reduction in its workforce will be watched closely for its effect on customer service, network maintenance, and the pace of its fibre broadband rollout, which competes directly with BT's Openreach network.
For now, the figures remain unconfirmed: the company has not announced a redundancy programme, and the final number of job losses could yet change before Tuesday's results. Employees, unions, and investors will be looking for the cost-reduction target that management promises to set out then, which should show how deep the shake-up will actually go.
